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Major victory for entry-level coaches
NCAA to pay $54.5 million in restricted-earnings case
Posted: Tuesday March 09, 1999 02:47 PM
KANSAS CITY, Mo. (AP) -- The NCAA agreed Tueesday to pay $54.5 million to entry-level coaches who had sued because they were not being paid enough.
The governing body of college sports also agreed to drop its appeal of a judge's ruling in favor of about 2,000 Division I assistant coaches who had come under the "restricted-earnings" plan.
"This has been a long and -- unfortunately -- divisive issue," said Charles Wethington, NCAA executive committee chairman. "It has pitted employee against school and sometimes friend against friend."
The settlement was reached through mediation and both parties had been trying to agree on a settlement figure since Feb. 24.
Next step for the NCAA is deciding how to allocate the $54.5 million in damages among the 302 Division I schools. Attorneys' fees will come out of that figure.
Executive director Cedric Dempsey said the NCAA will contribute about $22 million from cost-saving measures the next three years, leaving the schools responsible for $32.4 million. He would not speculate on what the school-by-school allocation might be.
Dempsey pointed to two possible plans an NCAA committee is considering -- one, dividing the total equally among all Division I schools, the other based on division of revenue according to the size of the school.
"It is not likely the subcommittee's allocation plan will embrace either of these solutions," Dempsey said.
He said the NCAA would like to decide before the organization's next fiscal year begins in September.
The settlement comes one day after the NCAA was dealt a setback in federal court in Philadelphia. A judge discarded the NCAA's minimum test-score requirements for freshmen, meaning schools are free to set their own criteria for admitting athletes.
The NCAA has had a history of legal troubles. Although it scored a victory last month in a Supreme Court regarding sex-bias law, the organization mostly has been hit with losses of late.
Last year, the NCAA agreed to pay $2.5 million to settle a long-running suit brought by basketball coach Jerry Tarkanian, and reached an agreement with the Justice Department to allow students with learning disabilities to receive athletic scholarships.
The restricted-earnings rule was adopted as a cost-cutting move by near-unanimous vote of Division I schools in 1991. The rule capped salaries for assistants in various sports at $12,000 for the academic year and $4,000 for the summer.
The rule was lifted in 1995 after a U.S. District judge in Kansas City, Kan., found the NCAA violated federal antitrust law. That ruling was upheld by an appellate court, and the U.S. Supreme Court refused to hear the case.
Following a trial last year on damages, a jury awarded the coaches more than $22 million. Because it was an antitrust case, damages were tripled to $67 million.
Last fall, the NCAA offered $44 million as a settlement while the coaches sought $60 million. In January, a judge granted the coaches' motion to increase the damages to nearly $75 million to adjust for inflation.
"In cases of this type, there are consequences for everyone," Wethington said. "The important task at hand is to minimize adverse consequences for the student-athletes. It is time now for the NCAA and all those who support higher education and intercollegiate athletics to put this behind us and move forward."
Wethington said the NCAA executive committee had been prepared to appeal the verdict. But he added that the total cost, including attorneys' fees and the possibility of a new trial, most likely would have exceeded $100 million, he said.
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