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by
Edward N Matisik, JD
edmatisik@yahoo.com
June 14th, 2004
MARYLAND COURT ORDERS
DISCLOSURE OF GARY WILLIAMS’ EMPLOYMENT CONTRACT
TO BALTIMORE NEWSPAPER
The terms of employment
for a coach at a university with a major athletic program can often be a
source of controversy to students, faculty, staff, and alumni. Quite often,
a coach of a successful team will earn more—sometimes much more—than even
the President or other top administrators of that institution.
Private universities are
not under any legal obligation to disclose salaries, benefits, and other
parts of a coach’s compensation package to the general public or even to the
university community as a whole. In fact, the only parties at a particular
private school who are required to have knowledge of the terms of a coach’s
employment contract are those individuals who have the authority to enter
into that agreement on behalf of the school. Information about the
compensation terms for a coach will usually only become public knowledge if
someone leaks the information to a third party.
However, the situation is
quite different at a state-related college or university. Most states have
laws requiring state agencies and other state-related institutions to
disclose information to the general public related to the compensation of
state government employees and, as staff members of a state-related
educational institution, athletic coaches at those institutions are
considered to be state government employees. Consequently, it is often
quite easy for anybody to obtain a copy of a coach’s employment contract—in
some states, it only involves filing a simple form with the appropriate
state agency and sometimes paying a nominal fee.
A Newspaper’s Request for
Compensation Information on the University of Maryland’s Football Coach
In January 2002, Jon
Morgan, a sports reporter for The Baltimore Sun, the city’s major
daily newspaper, began to research a story on the compensation package of
Ralph Friedgen, the University of
Maryland’s (UM) football coach. As part of his research, Morgan filed a
request with the UM’s Athletic Department pursuant to the Maryland Public
Information Act (MPIA).
The MPIA requires state
agencies to provide, upon request, information about a state employee’s
salary to any member of the general public. Further, under an opinion
issued by the Attorney General of Maryland in 1998, all state agencies must
construe the word “salary” to include a regular salary as well as bonus and
performance awards. The Attorney General stated that the term “salary”, as
used in the MPIA, must be read broadly because “Giving ‘salary’ too narrow a
construction would allow governments to secretly augment the earnings of
public employees through bonuses and performance awards, contrary to the
[Maryland] General Assembly’s goal of holding a government publicly
accountable for its compensation decisions…to borrow a phrase from an Ohio
court, ‘the public has an absolute right to ascertain the earnings of its
servants.’”
However, upon receiving
Morgan’s request, the UM Athletic Department, acting under the advice of
UM’s general counsel, provided The Baltimore Sun only with Friedgen’s
actual salary at the time, $183,920. UM denied Morgan’s request for “copies
of the original and revised employment contracts…for Friedgen…and any
separate letters of understanding, side letters or similar documents
specifying incentives, bonuses, broadcast agreements, athletic footwear
contracts, and other matters concerning the terms and conditions of [Friedgen’s]
employment and compensation.” UM stated that it denied the request pursuant
to another section of the MPIA that prohibits the state from disclosing
financial information about a state employee related to that employee’s
“finances [as] as individual, including assets, income, liabilities, net
worth, bank balances, financial history or activities, or
creditworthiness.”
The Baltimore Sun’s
attorneys responded with a threat to sue UM for improperly denying Morgan’s
request for the additional information. However, in order to forestall a
lawsuit, Friedgen, acting in his own capacity, voluntarily agreed to
disclose his total compensation package to the newspaper. Friedgen revealed
that in addition to his salary of $183,920, he had also earned during the
previous fiscal year $762,000 for competitive achievement (winning the ACC
Championship and receiving an invitation to a BCS Bowl), automobile
allowances, radio and television appearances, apparel and endorsement
agreements, and student-athlete academic achievement bonuses.
The Baltimore Sun
Seeks Information on Basketball Coach Gary Williams
Just prior to Friedgen’s
decision to voluntarily disclose his compensation package to The
Baltimore Sun, Morgan filed another information request under the MPIA
seeking the same information on UM men’s basketball coach Gary Williams.
Again, the University refused to provide the newspaper with actual copies of
agreements between Williams, UM, and third parties, but it did expand its
response a bit. The UM Athletic Department responded to The Sun,
“Coach Gary Williams earns a regular salary of $202,991 in fiscal 2002. To
date, he has also earned $540,400 for competitive achievement (ACC Regular
Season Championship and NCAA National Championship), automobile allowance
and radio, television and personal appearances. The availability of
additional University compensation based upon student-athlete academic
achievement and NCAA compliance is evaluated at a later date. His
apparel/endorsement compensation is received directly from the apparel
company.” UM declined to provide any additional information to the
newspaper, stating that such information was part of Williams’ “personnel
record” and was, therefore, not disclosable under the MPIA.
The Baltimore Sun
Sues the University of Maryland
The Baltimore Sun
immediately sued UM, seeking an order for the court requiring the University
to provide it with the information related to Williams that it had not
disclosed: a copy of his actual employment contract with the University,
copies of his endorsement contracts with athletic apparel manufacturers and
other organizations, and agreements related to sports camps, speaking
engagements, and consulting services.
The newspaper argued that
the plain language of the MPIA required the University to disclose the
information and that the University’s argument that such records were not
disclosable as “personnel records” accorded an unwarranted “broad secrecy to
the terms of a state employee’s compensation, contrary to the MPIA’s mandate
that the salary of public employees should be a matter of public record.”
The Maryland Court of
Appeals Rules Against the University
The Maryland Court of
Appeals, the highest court in the State, first considered whether the
University should have disclosed Williams’ employment contract to the
newspaper. The Court noted that Williams is, undisputedly, an employee of
the University of Maryland at College Park, which is a part of the
University System of Maryland, which is, in turn, an instrumentality of the
State of Maryland. Further, since Williams’ contract with UM was
“documentary evidence in the transaction of public business” and, under
Maryland law, a “public record” includes “a document that lists the salary
of an employee of a unit or public instrumentality of the State government”,
the Court held that Williams contract with UM was clearly the type of record
that should have been disclosed to The Baltimore Sun upon its
request.
Turning to agreements
between Williams and third parties, the Court held that such agreements must
also be disclosed to the public if a certain set of conditions are met.
The Court noted that
under the terms of Williams contract with UM, the NCAA’s Enforcement
Provisions and By-Laws are considered to be a fully integrated part of the
contract between an athletic coach and an NCAA-member institution. Further,
the Court found that under NCAA By-Law 11.22.2, an athletic coach “must
report annually to the member institution the sources of his or her
athletically related income from third parties.” “Consequently,” the Court
of Appeals stated, “pursuant to the NCAA reporting requirements…the
University has come into possession of documents that contain references to
contracts for remuneration, and other financial arrangements, between the
coaches and third parties.”
The Court noted that,
“There are, to be sure, benefits that flow from being the head football or
basketball coach at an institution like UM. As with any employment
opportunity, there are both benefits and burdens. Along with status and
celebrity, these positions afford the individuals holding them with a wide
array of business and financial opportunities. Often, these opportunities
result in financial remuneration from third parties over and above that
called for by, but nevertheless consistent with, the contract with the
University. As [an] employee of the State of Maryland…Coach Williams shares
in the burden with the thousands of other state employees whose employment
terms and affairs are subject to the inspection requirements of the MPIA.
To date, the MPIA does not provide an exception for head coaches who work at
schools with NCAA programs.”
The Court further
determined that there are contracts—such as a coach’s endorsement contracts
with the manufacturers of athletic apparel—that “are so connected with, and
related to, the coach’s public employment as to be, in effect, authorized
by, and thus, a part of, the University contract.” Therefore, the Court
held, Williams’ contracts with third parties, as reported by him to UM
pursuant to NCAA By-Law 11.22.2, are disclosable to the general public if
they “are so connected with, and related to, the coach’s public employment
as to be, in effect, authorized by, and thus, a part of, the University
contract.”
The Court issued an order
requiring UM to provide the newspaper with an actual copy of Williams’
contract with the University. It also ordered a lower Maryland court to
review all of Williams’ contracts with third parties, as reported to UM
under 11.22.2, to determine which contracts, if any, were “so connected
with, and related to, the coach’s public employment” that public disclosure
was warranted under the MPIA. The Court then directed the lower court to
issue an order requiring UM to disclose those contracts to the newspaper.
The Court entered
judgment in favor of The Baltimore Sun.
The case is University
System of Maryland v. The Baltimore Sun Company, Case No.
CAE02-06069 (Md. 2004).
To contact Ed
Matisik, or to read his bio, please click
here.
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