A few months ago, University at Buffalo Athletic Director Mark Alnutt might not have given much thought to adding a pandemic clause to contracts for future football or basketball games. But that was before Covid-19 brought college sports to a standstill, resulting in losses of millions of dollars for athletic departments across the country.
The pandemic has compelled more college and university athletic departments, including those at UB, Canisius, Niagara and St. Bonaventure, to add language to contracts that provides legal and financial protection from potential losses if an event is postponed or canceled because of Covid-19.
“This has spurred a lot of processes that need to be reviewed and changed, and to be cognizant of this language that is added to the contract,” Alnutt said.
Canisius Athletic Director Bill Maher said the last time administrators considered adding contract language regarding a pandemic was during the SARS outbreak in 2003.
College athletic departments are scheduling opponents for the upcoming school year, even as some schools have not announced if there will be in-person classes this fall.
“We’ve started putting that language in,” St. Bonaventure athletic director Tim Kenney said. “Not just for a high-profile sport like basketball, but for all of our teams. We have to do this to be safe because of how regionalized Covid-19 is being handled in different areas. If we had to host a game, let’s say, and New York has a giant uptick, we don’t want to be penalized to not hold the game for something out of our control.”
Force majeure clauses
The News obtained contracts through public records requests from several universities for scheduled football and basketball games involving Big 4 programs in the 2020-21 school year and in future years. A review found that while there is a force majeure clause in those contracts, there is no specific language that addresses a pandemic or an epidemic.
Niagara's contract with Ohio State for a men’s basketball game scheduled for Nov. 15 in Columbus was signed in the first week of March. According to the contract, Niagara is scheduled to receive a $95,000 payout. It includes a force majeure clause that states the contract may be terminated by either school if it becomes impossible to play the game “for reasons of power failure, strikes, severe weather conditions, riots, war or other unforeseen catastrophes or disasters beyond the control of either party.” It also states that neither party would be responsible to the other for any loss or damage, but the contract does not specifically include language that addresses a pandemic or Covid-19.
“A force majeure is an act of God,” Niagara Athletic Director Simon Gray said. “If something happens that’s outside our control, the game would be canceled. It’s all based on, if someone can’t fulfill their obligation as part of a contract, why is that? The force majeure would involve both parties and reasons outside of their control.”
The pandemic also could affect travel for UB and St. Bonaventure to the Paradise Jam in the U.S. Virgin Islands in November. Bona travels to New Mexico in December as part of the inaugural Mountain West-Atlantic 10 Challenge.
UB’s contracts for football games scheduled for Sept. 5 at Kansas State and Sept. 19 at Ohio State include force majeure clauses regarding cancellations, as do future contracts for games against Minnesota in 2025 and a four-game series against Connecticut in 2024-25 and 2028-29. None specify terms or penalties for cancellations because of a pandemic.
The contracts with Ohio State and Kansas State also specify that neither party would be responsible to the other for any loss or damage under the force majeure clause. However, if UB were to cancel for other reasons, it would owe Ohio State $1 million; if Ohio State was to cancel for other reasons, it would need to reimburse UB for expenses and make up the difference between the expected payout and UB's payout from its replacement opponent.
“A lot of football contracts are made so far in advance that they don’t have the language, but having the conversations with general counsel, that if something was to happen, it can be negotiated, it can fall under the force majeure clause," Alnutt said. Covid-19 "could pass us and we could have a vaccine, but even as we move forward, it’s a good practice to start including that, even for Olympic sports that don’t have a guarantee.”
Cancellations of the Kansas State or Ohio State games this season could cost UB up to $2.7 million in payouts – $900,000 from Kansas State and $1.8 million from Ohio State – or about 7.3% of its athletic revenue during the 2019 fiscal year, according to federal data.
“If these games aren’t played, regardless of a pandemic, it will affect the bottom line,” Alnutt said. “And we’re in the position with so many other schools, like Group of Five schools or FCS schools, that if these games aren’t played, that creates a significant toll on revenue.”
Firming up contracts
Maher said many of Canisius’ contracts for the 2020-21 school year are in the process of being drafted, and some fall sports contracts are being reviewed, even though dates have already been agreed upon for games and series. Those dates could change, however, because the Metro Atlantic Athletic Conference announced Monday that it intends to have a common start date for games for all schools.
“What we’ve done is amend our force majeure language to include the pandemic, and expand the force majeure," Maher said.
Maher and Gary said they are working with the MAAC legal counsel to formulate the clause.
Niagara has temporarily suspended contract negotiations for events for the upcoming school year because of the pandemic.
“Once we are ready to start sending out contracts, they will include that provision,” Gray said. “But we need to determine what the fall will look like for every sport, before the fall begins.”
But as winter and spring sports scheduling continue – many contracts for college basketball games are written and signed in the spring and summer – more athletic departments are including language on contracts that address a pandemic.
Central Michigan’s seven-page contract for a basketball game against Pittsburgh, scheduled for Dec. 19 at the Petersen Events Center in Pittsburgh, includes language that specifically addresses Covid-19.
Among the allowable reasons to break the contract are "pandemic (including but not limited to the continuation of the existing Covid-19 pandemic), epidemic, compliance with applicable law or governmental order, rule regulation or directive, action of government or public authority or other similar circumstances (a 'Force Majeure Event')."
That contract requires the affected party to also immediately notify the other, in writing, within five days of the occurrence of the force majeure event. If the game is canceled for reasons other than terms stated in the force majeure clause, the party that broke the contract would owe the other $100,000.
“Game contracts are no longer what they used to be,” Kenney said. “There’s more monetary considerations for these things. You can’t just say, we’re not playing. You scheduled a game, and you’re owed money, but something like a pandemic, it’s out of your control.
“It’s very simple language. It’s not crazy, but act of God, pandemic … you just don’t know. Some people open their schools up, some don’t … and they get a spike" in Covid-19.
Kenney posed a hypothetical scenario. A payout for a Bona road basketball game at a Division I school in Texas, which recently reopened after Covid-19 restrictions, would be worth $80,000.
“If they shut down the campus and cancel the game, we’re out" that money, Kenney said.
There’s also been a precedent, though not involving a pandemic.
In 2017, Miami canceled its football game at Arkansas State after it could not travel to Arkansas because of Hurricane Irma, and attempts to reschedule the second half of a home-and-home series failed. Miami sued to void the contract, while Arkansas State countersued Miami for a breach of contract.
The original contract between the schools, according to the Arkansas Democrat-Gazette, stated that Miami owed Arkansas State a buyout of $650,000. Both schools filed lawsuits, and a settlement after mediation required Miami to pay Arkansas State $400,000.
“You have that in a contract, or you’d have go to court and settle,” Kenney said. “It’s a lot cleaner doing it with the language. It prepares us.”
