Outside counsel in coach’s firing could cost $100K

While the war of words escalates in the case of fired basketball coach Gib Arnold and the University of Hawaii, so does the cost.

UH is contracted to pay Honolulu attorney William McCorriston, its outside counsel in the case, "up to $100,000," according to terms of the agreement. The contract was obtained by the Honolulu Star-Advertiser under the state’s open records law.

Under terms of the contract with UH, McCorriston may bill UH at the rate of $375 per hour with lesser amounts for other attorneys and staff from his firm, McCorriston Miller Mukai MacKinnon LLP.

UH was required to seek outside counsel in the case because its own Office of General Counsel was responsible for drawing up the July 1, 2011, agreement with Arnold and could be considered a material witness in the case.

McCorriston was hired Friday, according to his agreement with UH, the same day the school received its "notice of allegations" from the NCAA for the collegiate governing body’s eight-month investigation into the Rainbow Warriors program.

At issue in the dispute between UH and its ex-coach of four seasons is a clause in the 2011 agreement that spells out the liquidated damages in the "without cause" termination. It is believed to be unique among contracts of major coaches at UH.

Arnold and assistant coach Brandyn Akana were fired on Oct. 28. On Jan. 26, Arnold was due a severance payment for more than $200,000, the remainder of his approximately $344,000 annual salary for the 2014-15 season.

Whether UH owes Arnold upward of $1.4 million — payment equal to what Arnold already accrued under his contract, a period of 31⁄2 years — as the coach has claimed, comes down to more than simply the wording of one termination provision in the agreement, McCorriston said.

"That’s his interpretation of the contract," McCorriston said Wednesday. "We don’t read it that way. But even if he were correct, the contract has many provisions. That’s just one of them. In paragraphs 1B, 1C and 1A … there are permanent obligations for him to comply with NCAA rules and protocols, to make sure his (basketball) program complies with those rules and protocols. And certainly if the allegations by the NCAA are proven, that would be a breach of contract, which would have to be considered in the parameters of what, if anything, is owed to Coach Arnold."

In the 1B section of Arnold’s contract, it states in part: "Coach … shall cooperate fully in any investigation of possible NCAA violations conducted or authorized by the university or the NCAA at any time."

One of the primary allegations the NCAA directed at Arnold involved honesty during the course of its investigation in late 2014. It stated Arnold "knowingly provided false or misleading information to the institution and NCAA enforcement staff regarding his knowledge of and/or involvement in violations."

The "without cause" severance language in Arnold’s contract essentially favors UH if he is terminated early in the contract, while the coach would stand to receive more if he is terminated late in the deal.

James Bickerton, Arnold’s attorney, said, "I’ve seen reports where McCorriston tries to suggest the clause makes no sense, but it is a perfectly rational clause and it was intended to operate that way by the university."

McCorriston and Bickerton are former partners.

It is believed to be the first time UH has used that particular language in a "without cause" termination provision for a head coach in one of its major sports. Neither football coach Norm Chow nor women’s basketball coach Laura Beeman has that language in their current deals.

Chow’s contract, signed Jan. 1, 2012, states, "In such event, university will pay coach as liquidated damages, a lump sum amount equal to coach’s total remaining base salary through year four of this agreement and $200,000 for year five of this agreement…"

Beeman’s contract, signed March, 27, 2012, says, "In such event, university will pay coach, as liquidated damages, a lump sum amount equal to the total amount remaining under the terms of this agreement."

Arnold’s contract was to have expired July 1, 2014, but by virtue of a 20-11 win-loss record in 2013-14 he earned an additional year, running through June 30, 2015.

McCorriston said to his knowledge there has yet to be a formal lawsuit from the Arnold camp. UH was not immediately able to confirm whether a union grievance had been filed on behalf of Arnold, whose contract is signed off on by the HGEA.

Both UH and Arnold are formulating official responses to the notice of allegations.

In its notice of allegations, the NCAA said Arnold "acted contrary to the principles of ethical conduct" during his four seasons as UH coach and "knowingly influenced others to provide the (NCAA) with false or misleading information, or to conceal information" during the investigation.

"If proven — emphasis on ‘if proven’ — the allegations concerning coach Arnold, especially those related to the alleged cover-up, are quite serious and would involve a tremendous loss of reputation, money damages and other costs to the University of Hawaii," McCorriston said. "In any resolution with coach Arnold, those matters would have to be taken into consideration."

Arnold’s statement Tuesday said he will "most fiercely defend" against the NCAA’s allegations, including two of the Level I (most serious) variety.

"I am aware that coach Arnold, according to this press release, is denying these allegations," McCorriston said. "I’m also aware the NCAA’s notice of allegations have particular details regarding witnesses and what witnesses said, which are very troubling to the University of Hawaii with regard to coach Arnold.

"We will study these matters carefully. We will be deliberate in our response. And these questions will have to be answered before there’s a final monetary resolution with coach Arnold."

Arnold is represented by Kansas City, Mo., attorney Scott Tompsett in matters with the NCAA. Meanwhile, UH has engaged William H. King III of the Birmingham, Ala., firm of Lightfoot, Franklin and White in its NCAA dealings. Under terms of its contract, UH is to pay King’s firm "up to $20,000" plus travel expenses.

UH has declined to say whether it fired Arnold on a recommendation of its general counsel or the Alabama firm.

Meanwhile, on Tuesday UH began advertising the position of vice president for legal affairs and university general counsel on its website. The university has paid its outgoing vice president, Darolyn Lendio, $235,248.