Board of Regents OKs ex-UH coach’s cash settlement

KAHULUI >> The contentious dispute between the University of Hawaii and its former men’s basketball coach over his firing a year ago amid an NCAA probe drew to a close Thursday, with the approval of a $700,000 settlement deal for Gib Arnold.

The university’s Board of Regents voted 8-6 in favor of the agreement, which includes $500,000 paid to the former coach over three years and $200,000 for his attorneys. The so-called global settlement means both sides have agreed to drop all claims: two prohibited-practice complaints before the Hawaii Labor Relations Board, a union grievance filed by Arnold and a lawsuit brought by UH.

The regents, who by policy must approve settlements of more than $500,000, approved the agreement after roughly two hours in executive session during its monthly meeting Thursday at the UH-Maui College campus.

Regents who voted in favor were Chairman Randy Moore, co-vice chairs Jan Sullivan and Eugene Bal, Coralie Matayoshi, Michael McEnerney, Barry Mizuno, Stanford Yuen and student regent Michelle Tagorda.

Those voting against the deal were Wayne Higaki, David Iha, Benjamin Kudo, Jeff Portnoy, Lee Putnam and Ernest Wilson.

Simeon Acoba recused himself from the vote.

Ahead of the vote, Moore characterized the closed-door discussions as intense and wide-ranging.

"I think it’s fair to say there is unanimity that we are uncomfortable with the position that we find ourselves in," Moore said. "There is also unanimity among the regents that the variety of perspectives that were expressed are all relevant, appropriate, and nobody believes that their position is superior to anybody else’s."

The yearlong dispute is expected to ultimately cost UH nearly $1.1 million. The university anticipates its legal fees will add an additional $250,000 to the costs, along with $148,000 previously paid to Arnold after his firing last October, representing the balance of his $344,000 annual salary.

Carrie Okinaga, UH general counsel, said $100,000 of the settlement will be paid by insurance, with the rest covered by the university’s risk management fund, which she said exists "to account for unanticipated losses, settlements." She said UH estimated its legal fees to take the case through a trial, "even if we were to win entirely, probably could have exceeded the $700,000 just in and of itself."

"After long consultation and deliberation with the board and with the administration and with outside counsel, the decision was made in the best interest of the university and the athletics program — the men’s basketball program in particular — the decision was made to approve the settlement," she told reporters after the vote.

UH-Manoa Chancellor Robert Bley-Vroman, in a phone interview from Dallas, said he was pleased the university reached a settlement.

"We are happy we’ve reached a resolution here to move forward. It will be good to put this behind us," he said. "The goal all along was to mitigate the impact to the (men’s basketball) program. This, I think, is a reasonable solution. In general, moving forward, I think it’s important for us to show our commitment to the highest levels of integrity and competence."

Under terms of the deal, Arnold will receive $100,000 on Nov. 30, $200,000 on Jan. 15 and $200,000 on Jan. 15, 2017. His attorneys will receive a $200,000 payment Nov. 30.

He had been seeking $1.4 million from the university under a firing "without cause" clause in his 2011 contract.

That section of Arnold’s contract stated, "This Agreement may be terminated without cause upon ninety (90) days written notice to Coach. In such event, the University will pay as liquidated damages, a lump sum amount equal to the total amount of compensation earned under the terms of this Agreement as of the date of termination (incentives and extensions not achieved are not included in liquidated damages)."

Okinaga said UH already is revamping its controls over contracts to prevent future disputes. For one, she said, UH is looking to standardize language for contracts for head coaches, who are represented by the Hawaii Government Employees Association.

"We have two attorneys reviewing every athletic department contract; every head coach contract will be reviewed by two attorneys and myself; we are reallocating positions within (the Office of General Counsel) to focus on contract review; and again, we are focusing on trying to standardize some of the language," she said.

Asked how the clause language got inserted and whether anyone at UH would be held accountable, Okinaga, who joined the university in June, said, "The contract definitely left room for interpretation. I wasn’t there. … I’m accountable. And these are the reasons for the controls that we’ve put in place. The rest is a personnel matter, internal to the university."

UH announced Arnold’s termination Oct. 28, soon after the NCAA had substantially completed its eight-month investigation of the basketball program. A subsequent notice of allegations from the governing body of college athletics cited the program for seven violations.

The former coach had filed a grievance with his union in February, seeking the $1.4 million under provisions of his contract. UH filed a lawsuit in June claiming Arnold owed the school more than $2,000 for a past travel advance.

Honolulu attorney Jim Bickerton, who represented Arnold, said in a statement, "Coach Gib is pleased that the case has settled and believes that the nature of the settlement — under which UH … has dropped all claims against him — answers many questions that the public had about this matter. The remaining questions the public has will soon be answered by the NCAA hearing process that has us in Dallas (Thursday)."

Arnold and UH representatives appeared at a closed-door hearing in Dallas before the NCAA Committee on Infractions. UH officials said a ruling from the NCAA hearing is not expected for several months.

Arnold’s payout — the $500,000 direct settlement, plus the $148,000 already paid to him — tops the $600,000 buyout ex-football coach Greg McMackin accepted when he was forced out in 2011. UH negotiated that settlement down from the $1.1 million McMackin was due in the final year of his contract.