Vanderbilt vs. DiNardo - be considered a penalty. The sum...

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Econ 404 12:04:18 rmf34 Vanderbilt vs. DiNardo Judge(s): John Gibson Court: US Court of Appeals, 6 th Circuit (Location, Date): October 1998 Plaintiff: Vanderbilt University Case Summary: Gerry DiNardo, Vanderbilt’s head football coach resigned to coach at Louisiana State University. This was a breach of contract. Summary judgment for $281,886.43 in damages. DiNardo appealed. There was the contract that stated if he terminated his contract early, he would pay the remaining salary he would have made as a breach of contract (minus taxes). Original contract expired January 5 th 1996. DiNardo was offered a 2 year contract extension. He wanted to discuss the contract with his brother and a lawyer. New contract termination date was January 5 th 1998. On December 12, 1994, DiNardo accepted the L.S.U. head coach position. Courts will not enforce such a payment as a breach of contract if the sum is so much as to
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Unformatted text preview: be considered a penalty. The sum can cover damages only. A penalty is designed to coerce performance by punishing default. Vanderbilt argues that the damages to the university are hard to measure, and they far exceed the cost of just hiring a new football coach. DiNardo says that his salary has no relationship to the damages caused to Vanderbilt. The contract and early renewal implied the importance of keeping him and having a stable program. Evidence was provided that getting a new head coach is very expensive. Then the case was remanded to the district court. Section 8 seemed to be penal to discourage him from taking another coaching job. It was suggested finally that the exact damages be determined if possible. Defense: Gerry DiNardo Verdict: Law and Economics Notes: Liquidated damages Money agreed upon when the contract is ended without completion...
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This note was uploaded on 12/11/2007 for the course ECON 4040 taught by Professor Hay during the Fall '07 term at Cornell University (Engineering School).

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