Academic

Can Athletes Win Lawsuits Over Rescinded Scholarship Offers?

By Gordon Smith, Christine, Hurt, Vic Fleischer, Fred Tung, Lisa Fairfax, David Zaring

SI describes the plight of Daniel Smith (no relation), a young man from Boise who orally accepted an offer of a football scholarship from the University of Hawaii last April. After Hawaii Head Coach June Jones decided in January to accept an offer to coach Southern Methodist University, one of the assistant coaches at Hawaii called Smith to rescind the scholarship offer. According to Smith, he had promised Hawaii that he wouldn't entertain offers from other schools, so he was left without a scholarship for this fall. Smith sued.

Anyone who follows college football knows that the rules governing recruiting are heavily regulated by the NCAA, but the system of extending "offers" and receiving oral "acceptances" is very fluid. A player often "commits" orally to play for one school, then change his mind and "commits" to another school. Likewise, many coaches make offers, only to rescind the offers when a better prospect comes along. In short, while severing relationships is not pleasant, most everyone involved in the process seems to understand that the commitments made during recruiting are non-binding. The deal is done only when the player, his parents, and an institution's athletics director all sign a "letter of intent" (LOI). That letter commits the school to providing financial aid for one year -- assuming the athlete is admitted -- and it marks the point at which recruitment of the athlete by other schools must cease. (More here.)

Stories about jilted athletes and coaches are legion, but this is the first time I have seen such a case go to court. Smith's attorney is relying on the doctrine of promissory estoppel, and according to Smith, the promise from then-defensive line coach Jeff Reinebold went something like this: "If we offer you a scholarship, we want you to be 100 percent committed to us, and we'll be 100 percent committed to you." While SI quotes one source suggesting that such a promise would be out of character for Reinebold, that sort of talk is consistent with many recruiting stories with which I am familiar. In any event, let's assume for the sake of argument that Reinebold made the statements. Does Smith have a viable claim under promissory estoppel?

Smith seems to have strong case of reliance (he stopped working with other football programs), and his reliance appears to have been detrimental (he missed out on the possibility of other scholarships). But the question remains: was Smith justified in relying on Reinebold's purported promise?

Well, first there is the matter of agency law. Was an assistant coach authorized or apparently authorized to make such a statement? According to the SI story:

Daniel said he never spoke to Jones, Hawaii's head coach. And while most schools require the head coach to sign off on any scholarship offer, Hawaii's assistants under Jones sometimes did offer scholarships on their own. Greg Brown, a Las Vegas personal trainer, said Miano offered his son, Corbin, a scholarship last year. Corbin, a safety from Spring Valley High, called Miano in September to commit to Hawaii.

Good facts for Smith. But what about the fact that everyone knows that pre-LOI commitments are non-binding? Maybe Smith is so new to the system that he doesn't know what everyone knows. Or perhaps Hawaii was signaling its intention to transact on a different basis from other schools, to allow itself to be bound where other schools would not. Nevertheless, I have a hard time imagining a court siding with Smith in this case, largely because Hawaii will bring all sorts of evidence showing that these pre-LOI arrangements are not the basis for reasonable reliance. Even if Reinebold made a statement like the one above, it looks more like salesmanship than contract. Given the emphasis during recruiting on the formal LOI, Smith probably should have understood that the oral "commitment" was nothing more than rah-rah talk.

Full post as published by Conglomerate on March 03, 2008 (boomark / email).