Uhhh...Dixon to UCLA rumor/ news

[BABYFACE]

Dixon staying due to UCLA being unwilling or unable to pay his buyout seems like the worst result for all parties

Not necessarily. Could it be, yes. Dixon could either recommit himself to TCU like Schloss did or he could mail it in.

I think the Sullivan deal was a different deal. He was not a TCU for the long haul. It was his first HC gig and it was a stepping stone.

 

[Moose Stuff]

Not necessarily. Could it be, yes. Dixon could either recommit himself to TCU like Schloss did or he could mail it in.

I think the Sullivan deal was a different deal. He was not a TCU for the long haul. It was his first HC gig and it was a stepping stone.

His entire staff (him included) would have rather been somewhere else from day 1 IMO. scheissing Reggie Herring used to come into the weight room while we were in there and loudly talk about how all the other schools he’d worked at were better than TCU.

 

[Big Frog II]

What a big fat mess.

 

[froginaustin]

I will say this. Nothing that has happened this year has inspired much confidence that he can take us to next level even if he stays. This is just the cherry on top of a whole bunch of factors. Were we better the previous years? Yes, but the program seems to be plateauing.

"Plateauing" is not the correct descriptor for what I saw last night, before I decided that I needed sleep more than I needed to watch what I was seeing on the court.

That's on the coach.

If he wants to leave, do it with dignity. Say so, and let an assistant be an interim.

 

[Frog-in-law1995]

And then there was this...

He likes sports and he don’t care who knows.

 

[Double V]

I disagree. If he wants to go, negotiate an amount to get something out of it and let him go. Holding someone here over a buyout is in my view a bad strategy. See Pat Sullivan for example.

If the reports are true and they want him that badly, they'll pay the $8M...

 

[TooColdU]

I don’t see this as being similar to the CJS situation at all. For the most part, CJS’s temptation to leave was the disadvantage here at TCU because of NCAA rules. Dixon doesn’t have any restrictions here at TCU.

If anything, the basketball program has been given the most despite the lack of success compared to football & baseball.

 

[flyfishingfrog]

Other than keeping an unhappy coach if UCLA passes?

Why would Dixon be paying the buyout himself?

That is pretty unusual

And if so - why would you want to go?

Again - all that says is UCLA has either no money or isn’t that committed

 

[Froggish]

If the reports are true and they want him that badly, they'll pay the $8M...

Good for TCU and If true, that combined with the cost of the contract means they are over paying. Big time reach

 

[TCUdirtbag]

Why would Dixon be paying the buyout himself?

That is pretty unusual

And if so - why would you want to go?

Again - all that says is UCLA has either no money or isn’t that committed

Well, the contract will put the buyout obligation on Dixon OR his new school. For tax reasons, the school would pay it. But from just a logical standpoint, if UCLA is spending $8 m on a buyout that’s $8 m they aren’t spending on something else - salary, benefits, assistant coaching pool, recruiting budget, charter flights. But the most obvious spot some of that $8 M would come from is head coach salary over the life.

Say UCLA claims they can get $5 in buyout money. The other $3 may come from $500k less in salary over the next 6 years.

 

[Brog]

OK, all this talk of buyouts, etc, seems to assume that Dixon has said he wants to go to UCLA. Has this happened? Do our inside "sources" know that he is now at the bargaining stage? Just curious.

 

[LisaLT]

In a HEART BEAT. Great coach. Hire Rick Pitino!!

 

[Gary's Shirtless Revenge]

They would most likely look at the life of the contract and not just the period of time elapsed. No idea what the term is, but the large buyout likely indicates it was around 7 years. If so, the buyout is around 1/3 (probably less) of the total contract value of $24+ M.

But practically what would the strategy be? Stay and sue? That’s career suicide. Breach and refuse to pay? That would draw UCLA in, and UCLA isn’t going to go and get itself drawn into a lawsuit with TCU for Dixon.

There could be reasons for TCU to negotiate it down a bit, but barring some unknown skeleton in the closet there’s little practical reason for TCU to negotiate this all that much. UCLA knew the buyout going in and is going to pay if they want him. If they don’t pay, then they didn’t want him all that much. The real “buyout negotiation” is between Dixon and UCLA — who’s going to bear that cost. Dixon and UCLA are obviously going to try to get TCU to come down while UCLA is looking for cash and Dixon is trying to keep that buyout from hitting his salary—LA is a lot more expensive than FW

The forward-look analysis is often used by the employer to justify the contract, but courts tend to look at the real, not the hypothetical. Arbitrators, which are usually incompetent, never consider the hypothetical.

The play for Jamie would be to leave, claim that he is contesting the penalty stipulation on certain grounds (whatever they are), and tell TCU that he intends to work for UCLA under a new employment agreement. His UCLA employment agreement would have to very carefully designate that they know Jamie was doing that, and that Jamie indemnifies and holds them harmless against that claim. They wouldn't be able to contribute any contingency funding towards paying the claim as that would nullify their neutral status. Jamie, in other words, would be on his own.

TCU would likely sue for breach and seek damages. Jamie undoubtedly has insurance that would cover such a claim and pay for his defense. Based on other talent employment contracts I've seen, there almost certainly is a clause that details out mandatory arbitration for any disputes, and it wouldn't be private but rather court administered. In that audience, its likely TCU would be forced to settle for a more reasonable figure, but Jamie would have to pay it OOP.

None of this is likely or ideal, but it is possible... And it is also why most parties typically negotiate these things and let people walk if they want to walk.

In all likelihood, TCU will accept a multi-year pay back agreement from Jamie that will allow him to pay the $8mm over 2 or 3 years, likely 2 if I had to guess.

 

[Ray Finkle]

I’m really bummed about Fred Hoiberg to Nebraska if this happens with Dixon. Hoiberg would’ve been an outstanding hire and he’s a really good guy.

 

[Gary's Shirtless Revenge]

Well, the contract will put the buyout obligation on Dixon OR his new school. For tax reasons, the school would pay it. But from just a logical standpoint, if UCLA is spending $8 m on a buyout that’s $8 m they aren’t spending on something else - salary, benefits, assistant coaching pool, recruiting budget, charter flights. But the most obvious spot some of that $8 M would come from is head coach salary over the life.

Say UCLA claims they can get $5 in buyout money. The other $3 may come from $500k less in salary over the next 6 years.

Speaking literally, the buyouts are ALWAYS paid by the employee back to the employer. Employers open up pandora's box of litigation if they start negotiating between employers how to handle employee disputes.

Now, practically what happens is the new employer pays a taxable benefit to the employee to cover the buyout as part of their employment agreement. The IRS is very clear about this, and its been litigated many times.

If Jamie had to pay all $8mm on day 1, he would have a tax bill of about $3.75mm between Fed and State taxes if my math is right. Given that UCLA is rumored to be paying him $6mm per year, they could structure those payments in a way so that his big tax bill would be covered, and he would only be OOP the additional tax burden he would owe on any given day. He'd have a lower income year to be sure, but he would still have more than enough net income to be very very comfortable.

 

[TCUdirtbag]

The forward-look analysis is often used by the employer to justify the contract, but courts tend to look at the real, not the hypothetical. Arbitrators, which are usually incompetent, never consider the hypothetical.

The play for Jamie would be to leave, claim that he is contesting the penalty stipulation on certain grounds (whatever they are), and tell TCU that he intends to work for UCLA under a new employment agreement. His UCLA employment agreement would have to very carefully designate that they know Jamie was doing that, and that Jamie indemnifies and holds them harmless against that claim. They wouldn't be able to contribute any contingency funding towards paying the claim as that would nullify their neutral status. Jamie, in other words, would be on his own.

TCU would likely sue for breach and seek damages. Jamie undoubtedly has insurance that would cover such a claim and pay for his defense. Based on other talent employment contracts I've seen, there almost certainly is a clause that details out mandatory arbitration for any disputes, and it wouldn't be private but rather court administered. In that audience, its likely TCU would be forced to settle for a more reasonable figure, but Jamie would have to pay it OOP.

None of this is likely or ideal, but it is possible... And it is also why most parties typically negotiate these things and let people walk if they want to walk.

In all likelihood, TCU will accept a multi-year pay back agreement from Jamie that will allow him to pay the $8mm over 2 or 3 years, likely 2 if I had to guess.

You articulate the situation well, but again - Dixon is unlikely to take the risk and UCLA is unlikely to want the distraction. Which is why it’s incredibly unlikely to play out this way.

I’d actually be very curious to see if the contract provides for mandatory arbitration. That would never fly with Texas public schools per state law (I assume many other states have similar laws but do not know that). Not sure how TCU/private schools and the industry handle contract dispute resolution by default given the huge advantage public schools have (if most states are like Texas and require state court or state administrative proceedings).

 

[TooColdU]

Boschini, Donati, Pitino.

Make him an offer he can’t refuse.

 

[Froggish]

Speaking literally, the buyouts are ALWAYS paid by the employee back to the employer. Employers open up pandora's box of litigation if they start negotiating between employers how to handle employee disputes.

Now, practically what happens is the new employer pays a taxable benefit to the employee to cover the buyout as part of their employment agreement. The IRS is very clear about this, and its been litigated many times.

If Jamie had to pay all $8mm on day 1, he would have a tax bill of about $3.75mm between Fed and State taxes if my math is right. Given that UCLA is rumored to be paying him $6mm per year, they could structure those payments in a way so that his big tax bill would be covered, and he would only be OOP the additional tax burden he would owe on any given day. He'd have a lower income year to be sure, but he would still have more than enough net income to be very very comfortable.

Many on this board, myself included, questioned If his teams were playing up to the standard of his current TCU salary. Now people are calling out 6m per year!...I’m in the camp that this is a big time desperation move by UCLA...No way he’s worth that money...

 

[Boomhauer]

Should’ve waited a week and offered Chris Beard $6MM/yr.

 

[TCUdirtbag]

Speaking literally, the buyouts are ALWAYS paid by the employee back to the employer. Employers open up pandora's box of litigation if they start negotiating between employers how to handle employee disputes.

Now, practically what happens is the new employer pays a taxable benefit to the employee to cover the buyout as part of their employment agreement. The IRS is very clear about this, and its been litigated many times.

If Jamie had to pay all $8mm on day 1, he would have a tax bill of about $3.75mm between Fed and State taxes if my math is right. Given that UCLA is rumored to be paying him $6mm per year, they could structure those payments in a way so that his big tax bill would be covered, and he would only be OOP the additional tax burden he would owe on any given day. He'd have a lower income year to be sure, but he would still have more than enough net income to be very very comfortable.

I’m not a tax lawyer, but there are at least 2 universities in the past 18 months wiring funds to other universities in the exact amount of the buyout, calling it the buyout, and contractually passing all tax burdens to the new coach w/ total indemnification of the school.

With the salary/“rights fees” split trend and with entities sometimes receiving rights fees and always being the recipient of coaches’ side hustle, some tax guys are trying to get creative and are running that buyout taxable benefit consequence through the entity. Haven’t seen that one litigated yet but if it hasn’t been the IRS will be coming for it soon.

Good for Jamie if he’s getting $6 M. That’s crazy money. Even with the FW to LA cost of living adjustments still a huge raise.