Guest contribution from Matthew J. Lopez, Candidate for Doctor of Jurisprudence, May 2010, Texas Tech University School of Law.
Defeating the number #1 team in the nation in the fifth most watched regular season game in history to advance to a #2 national ranking, and finishing the season with a share of a division title are accomplishments that almost any college football program would love to have. Most programs would likely do anything to keep the man that lead them there; however, Texas Tech is on the verge of losing the captain of its high powered passing attack. Mike Leach‘s offensive attack and football philosophy has introduced Tech to a national spotlight that the program has never experienced before. Under his tenure, coach Leach has produced award wining offenses, quarterbacks, and the nation’s first-ever two time Biletnikoff winner, Michael Crabtree. Leach and his revolutionary coaching style have been featured in both the New York Times and 60 minutes. Leach has also garnered the support of celebrities such as Donald Trump. The Red Raiders success has been steadily improving over Leach’s time with 9 straight bowl appearances. Leach’s interest in pirate history has developed a pop culture phenomenon in Lubbock. Next to every Tech flag flying in the West Texas wind is a pirate flag. In fact, the school’s band conducted several half time performances to a pirate theme, and many students are proud to call themselves members of Leach’s pirate school. In anticipation for their match up against the then ranked #1 Texas Longhorns, several thousand students camped out in front of the stadium, establishing their colony of fans and a new tradition at Texas Tech known as Raiderville. The Raiderville campers were not the only fans competing for prime space. Hotel rooms in Lubbock were booked and many late arrivals were forced to stay nearly 100 miles outside of town Despite his recent success, coach Leach and the Texas Tech administration (TTU) have been unable to negotiate a contract extension, since negotiations began over 10 months ago.
April 16, 2008: Leach’s representatives from International Marketing Group (IMG) contacted the TTU administration asking to negotiate an extension on Leach’s current contract; however, the administration preferred to wait until the end of the 2008 season. After the Red Raiders dream season that any other year would have resulted in a BCS bowl appearance, TTU offered Leach a 5 year extension at $12.1 million dollars. The negotiations then began in typical fashion as IMG counter offered with $14.25 million dollars over 5 years; however, after Tech’s loss to Ole Miss in the Cotton Bowl, TTU counter offered with $12.7 million dollar base salary with $600,000 in bonus. Leach and IMG explained that the base salary offered by the TTU administration was “acceptable,” but 4 other points of the contract became an issue.
- Penalty for Interviewing without permission. TTU requested that Leach ask permission to interview for future opportunities, and if he is denied permission but still contacts the other employer, TTU can terminate him with cause. In this situation, Leach would owe the university, 1.5 Million (Similar to Boston College situation).
- The amount of money Leach would receive if fired without cause by TTU. Under his current contract Leach would receive around 40% of his guaranteed money if fired without cause, about the lowest in the Big 12; however, under TTU’s latest offer, Leach would only receive about 11.7% of the guaranteed money, the lowest in the nation among D1 coaches.
- Leach’s buy out clause. Under the current agreement, Leach has $500,000 buyout clause, $240,000 below the Big 12 average for coaches. In the new offer, TTU would require Leach to agree to a $1.5 million dollar buyout.
- Leach’s personal property rights. As it stands now, Leach controls his own personal property rights, but TTU’s new offer gives the university control of these same rights.
TTU explained that their reasoning behind the penalty for interviewing clause was a result of IMG shopping Leach around for other coaching positions and denying it in the past. IMG then offended the TTU administration by sending an email to the Board of Regents but leaving out the University President, Athletic Director, and the Chancellor, arguing that IMG has not shopped Leach around. Since then, TTU has given IMG and Leach until February 17th to agree to these terms. In an attempt to reach some middle ground, IMG has countered by offering to work under the same clauses as Leach’s current contract, with a $500,000 buyout agreement and 40% compensation if terminated without cause to remain, despite the fact that the 40% is about the lowest in the Big 12. Leach and Tech have operated well under those terms for 4.5 years. IMG cited their research and felt that these offers were comparable to other Big 12 Coaches and very reasonable. However, the TTU administration declined the offer and restated its position that Leach had until the 17th of February to accept the offered contract.
TTU’s decision to maintain its stated reservation point (walk away point) and give Leach an ultimatum is considered a power technique in the world of negotiations. In this adversarial approach, a party treats the process as a zero sum game in which one side’s gain is another side’s loss, or put in other words, there must be a winner and a loser in the end. Using this mind frame has some benefits, but if used at the wrong time or in bad faith, can severally impede a negotiation. Power tactics can work if the party making the move convinces his opponent that his walk away point is lower than they believe it is; this would occur if TTU successfully argues to IMG that Leach’s value is worth less than IMG first believes. Conversely, using a power move can negatively effect your reputation, and the party making the move will be seen as uncooperative. This may cause your current business partner or future candidates to avoid conducting business with you because your reputation precedes you. Also, power tactics can offend the other party when they interpret the move as unfair or contrary to the norms of that business. Finally, if a party uses a power move but misjudges the other side’s walk away point, than the negotiation will likely end in an impasse (where no negotiation is reached). For instance if TTU believes that IMG and Leach’s walk away point is below the offer presented, but they misjudge this estimation, Leach will pass on the offer no agreement will be reached.
In the present case, the TTU administration only cites fairness between TTU and Leach for its reason to offer Leach a contract that contains clauses below the Big 12 average. TTU explained in a statement that Leach’s latest offer is not fair because Leach would be able to quit in the first year and only owe the university $500,000 while the University would be required to pay Leach $4.4 million of it if it chose to terminate Leach in that same year. This statement however, contradicts TTU’s previous statements that they were committed to having Leach be their coach in the future. If this is the case, TTU would not have any reason to terminate Leach’s contract without cause in the next few seasons. By making a fairness argument, TTU is inferring that terminating coach Leach without cause after next year is an option, which conflicts with the idea that they are committed to retaining Leach as the future coach of TTU football. Saying one thing and doing another may create a reputation of being uncooperative for the TTU administration.
The Red Raiders have already felt some of the backlash from this long, drawn out process, with losses of top ranked recruit Emory Blake and Tech’s best recruiter and running backs coach Seth Littrell. Both Blake and Littrell cited the contract issues as affecting their decisions. Additionally, where Raider fans anticipate a disappointing season, TTU will likely suffer in the number of season tickets sold and the number of sold out games in a stadium that just began one of two more expansion plans. TTU must be aware that they are making a decision that affects the football program, the fans, and future of all Texas Tech athletics. TTU may have invoked these power tactics because they were so offended by IMG’s emails or maybe it’s their inexperience in negotiating a high profile contract, but their methods of negotiation will likely result in an impasse, can possibly severe the idea of future contract extension with Tech’s soon to be winningest coach ever, and create a reputation as an uncooperative party to future coaches. As the February 17th deadline approaches (tonight), Leach will likely turn down TTU’s offer and coach under his existing contract as a lame duck coach. For the sake of the program and all the fans, hopefully at the end of the 2009 season, the administration and Leach will approach the negotiation table in a different fashion, or Leach will feel the administration does not respect his accomplishments and leave on his own accord.