As anyone
who has read my most recent book, Crisis Communications, or
followed my writings about the Penn State/Jerry Sandusky scandal elsewhere, or
my public statements in numerous speeches and national media interviews can
attest, I have long championed the reinstatement of the 111 vacated wins
stripped from former Penn State football coach Joe Paterno’s record. The actual
line I used many times was succinct: Explain history, don’t rewrite it. I
pointed out that vacating those wins was purely a vindictive and punitive act
by the NCAA.
So, why
aren’t I cheering the announcement that the NCAA and the Penn State board of
trustees had agreed on a settlement (of sorts) that Paterno’s vacated wins
would be reinstated and the plaintiffs (two state officials, not Penn
State) would drop this portion of a precedent-setting lawsuit?
Because this act settles nothing. If anything, it further
obfuscates the heart of the matter. The still naïve Penn State board almost
trampled each other in a stampede to vote their unanimous approval for this
deal. This is exactly the same jump-on-the-bandwagon-mentality that got the
school into this mess in the first place. This board is the gang that couldn’t
shoot straight, writ large.
One of the
purposes of the litigation was to expose the NCAA and its power grab for what
it was. The NCAA sanctions – the infamous consent decree – never should have
happened because the issues under review were criminal matters, not NCAA
infractions. The NCAA had no jurisdiction, yet they grabbed it anyway, while
the board was too numb to see what was happening. The court case, in part, was
designed to prove that and, in so doing, have the court vacate the entire
consent decree because the sports authority overstepped its bounds by a wide
margin when it forced it down Penn State’s throat. There was every indication
that Pennsylvania Commonwealth Court Judge Ann Covey was heading down that
path. Every time the NCAA filed a motion to dismiss the case for various
reasons, Judge Covey said this case is going forward. She was due to rule on the
legality of the consent decree. Stated more succinctly, she was going to rule
whether or not the NCAA had the authority to act in the authoritarian manner it
did. And the absolutely last thing the NCAA wanted was to have anyone
challenge — or worse, overturn — its authority.
But with this “settlement,” that examination doesn’t appear
likely to happen.
There is a world of difference between having Joe Paterno’s win
record restored because the NCAA never should have imposed that measure in the
first place, and a “settlement” agreement. The tally may come up to the same
impressive number of wins – 409 – but the methodology makes all the difference.
And because of a “settlement,” the stench of wrong doing still hangs heavily in
the Nittany Lion air.
In the press release the NCAA issued immediately after this
agreement, NCAA board member Kirk Schulz, Kansas State University president,
boasted, “Today’s agreement with Penn State reaffirms our authority to act.”
But Pennsylvania state senator Jake Corman, one of the lead
plaintiffs, had a different – and woefully naïve – perspective. “This is a
win,” said Corman. “The NCAA has surrendered. The agreement we have
reached represents a complete victory in the issue at hand – the consent decree
is voided.… This validates our position that the rush to judgment against the
Penn State Community was wrong….”
It does no
such thing, Sen. Corman. It proves nothing, except how woefully
naïve the board of trustees still remains. The board still does not understand
any of the basic precepts of crisis management and crisis communications.
Corman
also said, “As we progressed through the case, it was clear that the consent
decree could not stand up to the legal challenge.” I agree, which is why I
think a settlement without a statement from the NCAA admitting that the consent
decree never should have been imposed was another example of otherwise
well-intended people not understanding the power of crisis communications. Once
again, I think the NCAA played Penn State and the plaintiffs in this case like
the proverbial violin. That’s why you can have blowhards like Schulz claiming
complete victory. Schulz is correct: this is a victory for the NCAA.
The Penn State board of trustees was once again hoodwinked by the smarter,
slicker NCAA.
The litigation was supposed to address the legality (or lack
thereof) of the consent decree, of which the vacating of legitimate football
victories was only a part. From the outset, the NCAA tried every trick up its
sleeve to get the case thrown out, but they met their match in Judge Covey, who
was determined to hear this case. At issue was nothing less than the NCAA’s
testicles: Did the NCAA have the authority to impose the sort of draconian
sanctions, especially given all the highly questionable goings-on behind the
scenes to force Penn State into voluntarily accepting the sanctions? One
high-ranking NCAA miscreant boasted in an email to chief thug, Mark Emmert,
that they “bluffed” Penn State into accepting sanctions, fully believing that
they didn’t have the authority to act.
If, as Corman said, it was true that the “consent decree could
not stand up to the legal challenge,” why on earth cave in on the case now?
This should be the time to double down and press forward.
This was a “back room” deal negotiated by a small group of the
entrenched members of the BOT and the upper echelons of the NCAA. Only as a
result of these legal proceedings did documents and emails come to light that
revealed the NCAA’s unscrupulous methods in pressuring Penn State into accepting
the consent decree. I have to wonder aloud what the NCAA promised – or
threatened – to get to this “settlement.” It is important to remember that the
entrenched members of the BOT were in lockstep with the NCAA all along. They
and the university were never plaintiffs in this matter. The settlement vote of
the board was unanimous, but I am surprised that the nine alumni members of the
board went along with the vote. They perceived this as a victory; it was
nothing of the sort.
There will
still be a stench attached to the number of wins. Those critics – and they are
out there, believe me – who disagree with the reinstatement of Paterno’s wins
will never acknowledge that they should be counted. They have already started
beating the drum that the only reason the NCAA reinstated Paterno’s
victories was to try to sweep the issue under the carpet before the just
concluded NCAA annual meeting and convention.
Yes, I wanted the vacated wins to be reinstated, but not like
this. This settles nothing, except how inept the Penn State board continues to
be.
I've had basic training in lab safety and a few fire drills. Other than that, I've had zero training in crisis management and communication. And I've had zero training in the law and its processes.
ReplyDeleteNevertheless, when I read the initial reports of this legal settlement, I immediately had the exact questions, then realizations, that are pointed out here by Mr Fink.
I will never believe that naïveté or lack of crisis training drove Corman and McCord to develop, negotiate, and finally agree to THIS settlement.
Based on what I've read, I think that the Commonwealth of PA has now extracted $60 million from the PSU athletics program, thanks to the seemingly heroic efforts of two Commonwealth officeholders. At least one of these is an elected official.
Twelve million $$ of this charge on the athletics program is graciously awarded to some other entity within PSU. Some of this charge is conveniently assigned to pay the Commonwealth's legal fees for bringing this settlement about. And some of this money from PSU's athletic program will go to the very Commonwealth agencies and partners who did not follow up on reports by police and professionals that Gerald Sandusky was exhibiting suspicious behavior with kids. In fact, some of these agencies were responsible for continued placement of kids in the Sandusky foster home!
So who represented the interests of PSU in all this? I.e., who assumed the authority to take $60 mil from the PSU athletics program (a program which, BTW, was cleared of any legal wrongdoing by this very settlement)?
OH... but the PSU BoT, of course. That same entity that publically dismissed "so-called due process", colluded with the actual so-called independent investigators of PSU's culpability for Sandusky's actions, and declared that PSU's checkbook (NOT theirs) was open to all accusers REGARDLESS of any specific legal findings.
I will never believe that naïveté or lack of crisis training drove a single Trustee of PSU to act as they have acted THROUGHOUT the past three years. Neither can I believe that any one of them is substantially less intelligent or less capable of critical, analytical thinking than am I.
I think what's been going on through this entire debacle is not so much a playing of violins as a playing of sheep, as on the lonely hillsides of Scotland.
Thanks, Becky.
DeletePSU's checkbook and how it is being managed is evidence that the BOT didn't panic and were rather calculating.
First, while it looks like PSU cares about the victims by paying them almost $60M in settlements, the University fully expected that to be covered by insurance. This case over the payment - which PSU will lose -- is schedule to go to court in March.
Next, the $60M dollar fine is being paid from PSU Athletic Revenues which they will be paying FOR THE NEXT 30 YEARS to the University. While PSU lays out the up front $48M for the fines and the $12M in research, the AD will pay $43M in interest to PSU over the life of the loan.
So, that is $120M of the total spent to date that the BOT thought it wouldn't have to pay. Also, the legal costs of Curley, Schultz, and Spanier are covered under D&O insurance....the same with Baldwin's.
When PSU published its next accounting of the scandal, we'll see how much is really out of pocket and how much isn't.
Wow. Missed this earlier. Thanks, Ray.
DeleteI can't recall the Ins Co's position as to why they're not liable for this. Sandusky's employment status; NO legal finding of PSU's responsibility; sex abuse not covered by policy at time of incidents (the ones taken to trial)?
So could this case being heard in March reveal any of the bad behavior in this mess?
Regarding the loan to the AD (OMG, it just gets more and more awful!), does PSU normally do this type of financing itself?? OR is there some specially-connected bank involved?
If this is really set up as a regular loan (with apparently god-awful terms), the AD should be shopping around to refinance. Really.
Just this month I've had Wells Fargo, Edward Jones, AND State Farm offer to bid for my auto financing (through the dealer). (None can beat the 1.8% my dealer is charging!)
Then there's the Paterno suit. Seems like it could be a problem for the Plaintiffs if Joe's lawyer at the time (his son) implies to this day that Joe was told of Sandusky's behavior. But Joe didn't follow up or call the police or whatever would have kept his legacy intact because he just didn't recognize that what was reported to him was that bad. That Joe didn't know enough about child abuse to recognize that this was what Mike McQueary was telling him about.
I was taught 45 yrs ago that ignorance is not an excuse for violating the law. So, it seems like the Paternos would have a hard time arguing that Joe's legacy was unduly damaged at the same time they say 'yes, he did not act appropriately. But it's because he didn't understand the seriousness of what he was told.'
SMDH,
Becky
Becky,
DeleteHere are some answers for you.
can't recall the Ins Co's position as to why they're not liable for this. Sandusky's employment status; NO legal finding of PSU's responsibility; sex abuse not covered by policy at time of incidents (the ones taken to trial)?
It was the latter. PSU's policy has an exclusion for sexual abuse and molestation. It has been that way since 1992. None of the claims brought forward would be covered.
So could this case being heard in March reveal any of the bad behavior in this mess?
The only thing that MAY happen is that PSU could be exposed for its filing of a dishonest/fraudulent claim. From reading the PSU filing, they attempted to use the injury claim coverage for Sandusky's abuse. That is totally dishonest.
Regarding the loan to the AD (OMG, it just gets more and more awful!), does PSU normally do this type of financing itself?? OR is there some specially-connected bank involved?
Yes, PSU provides interest bearing internal loans to its departments. Also, it was PSU's policy to hold donations to each department for 90 days before disbursing them. That way PSU makes a cut of interest off every donation.
Thank you, Ray. Particularly because I realize that none of this is my business.
DeleteIf, in the end though, the AD really has to pay $60 mil to whomever, it seems they could do better than 4%-360 mo.
I agree with most of this but I think Corman/McCord wanted to settle so they could get some of the $60 million fine under their control. They had gone to court initially merely to get the entire $60 million fine to be spent in PA. Corman/McCord and the NCAA had wanted to settle a while back but Judge Covey refused and expanded the case to examine the legality of the Consent Decree.
ReplyDeleteHad Judge Covey ruled the Consent Decree illegal, Corman/McCord would have received nothing, and the fine money would have been returned to Penn State.
In the settlement Corman/McCord got their "win" and $48 million toward the $2 billion state deficit. No matter that they essentially took Penn State money under false pretenses.
I bet that unless the media holds their feet to the fire, that $48 million will not be new spending on child abuse prevention, it will merely replace $48 million the state was already going to spend.
Judge Covey or the PA Attorney General should invalidate the deal and go after both Corman/McCord and the entire Penn State Board of Trustees for their breach of fiduciary duty. I think they all acted for their self interest, not what was best for Penn State and the state of PA.
Yes, Tim!
DeleteMoreover, aren't all who are responsible for accepting this Settlement acting outside the law and its processes? No demonstrated jurisdiction, defensible evidence, or due process for ANYONE to extract this $60 mil from PSU Athletics!
Is there some version of Habeas corpus by which PSU Athletics could seek relief from unlawful punishment??
I suspect that when Corman/McCord dropped the lawsuit that rendered Judge Covey powerless to do anything more. Maybe Judge Covey could file a complaint with the Attorney General to investigate breach of fiduciary duty by Penn State trustees. That seems a long shot given the Attorney General's personal problems.
DeleteI don't know who else would have standing to sue Penn State over the breach of fiduciary duty. Maybe it would be student-athletes who will be adversely affected by the loss of the $60 million plus interest.
When the Penn State trustees are in bed with the NCAA, there is not much to be done to the NCAA. We can hope the NCAA decides to fire Emmert for his unethical conduct.
The best bet now is to hope Penn State switches sides in the Paterno lawsuit. Even then, the best possible outcome for plaintiffs would be for the NCAA to pay millions in damages and publicly retract the defamation and commercial disparagement in the Consent Decree. The Consent Decree was voided by the settlement so the Paterno plaintiffs can't get that nullified.
Groan...
DeleteThank you, Tim. (BTW, your posted comments here and elsewhere are always calm and seemingly filled with real knowledge. Thank you for this!)
I agree with all that you have written but I also think that you have to start someplace. This may not be the best way to begin but with all that has been said and written I feel that there will be many more parts to be investigated before all is done. JoePa was more to my family than just a football coach as my step son also was on the team and two more graduated from Penn State. There will always be negative responses to anything that is said or written and that is just the way people are today.
ReplyDelete