Ed Orgeron Divorce Court Finds Loophole in ‘Binding' Term Sheet
Ed Orgeron Divorce Court Finds Loophole in ‘Binding’ Term Sheet
The Court of Appeal of Louisiana last Friday ruled in favor of former LSU head football coach Ed Orgeron in a dispute with his former wife, Kelly Orgeron, over whether she’s owed a share of his LSU contracts for 2020 and 2021 and his termination agreement from the school.
Crucial to the decision was the court finding that while Orgeron signed what was termed a “binding term sheet” with LSU in January 2020-a month before the couple physically separated and Ed filed a petition for divorce-it was merely an “agreement to agree” instead of an enforceable contract for payment of compensation. The term sheet was then “superseded” by an employment contract approved by LSU’s board in April 2020.
In other words, the term sheet may have been labeled “binding,” but not in a way that created a shareable asset for the marriage.
Orgeron, 62, coached LSU from 2016 to 2021. He led the Tigers to a national championship in 2019, when the team finished 15-0. In January 2020, LSU rewarded Orgeron by signing him to the term sheet. It called for Orgeron to become one of the five-highest paid coaches in the NCAA and to be paid, before bonuses, more than $41 million over the following six years.
The deal was widely reported by the media as a new contract.
It was. Sort of.
On one hand, the deal contained specific information about salary, benefits and methods of termination by Orgeron or LSU. It also stated, “This is a legally binding Term Sheet and shall be enforced and construed in accordance with the laws of Louisiana.”
On the other hand, the deal explicitly stated it is “subject to approval by the LSU Board of Supervisors.” Further, it mentioned that Orgeron and LSU would “negotiate in good faith” to finalize a “long-form Employment Agreement” that would “supersede the terms of this Term Sheet”-though “until that occurs, this Term Sheet remains in full force and effect.”
The Tigers were less successful under Orgeron in 2020 and 2021, playing .500 football and underperforming expectations. The school and Orgeron negotiated a termination agreement in October 2021. It called for Orgeron to be paid $16.95 million over 18 installments. After offensive line coach Brad Davis coached the Tigers in the Texas Bowl on Jan. 4, 2022, LSU hired away Brian Kelly from Notre Dame to become the Tigers’ new head coach.
This coaching timeline matters for understanding the Orgerons’ marriage timeline and the role of divorce law.
Ed and Kelly Orgeron married in 1997. In April 2020, a family court judge ordered the separation of their property. Louisiana is a community property state, meaning there is a presumption both spouses have equal shares in assets and property when they’re acquired.
As Judge Mitchell Theriot wrote in his order on behalf of himself and two other judges, “there is no presumption of community” for the “various forms of income which came into Ed’s possession after the termination of the community regime.” This is important, Theriot explained, since the board’s approval “was not given until after the community had been terminated.”
Theriot also noted how the trial judge found the language of Orgeron’s employment agreements for 2020 and 2021 significant for understanding how to classify the accompanying property. Those agreements required Orgeron “to continue working and performing.”
While attorneys for Kelly Orgeron maintained LSU’s pay reflected a “reward” for past accomplishments-including the national championship-the trial judge sided with attorneys for Ed Orgeron. They maintained LSU’s decision to terminate their client less than three years after the championship season indicated his 2020 and 2021 compensation were “payment of Ed’s future services.” Theriot concurred, highlighting how Orgeron’s contract contemplated him leading a coaching staff and performing other duties in the context of “future work.” Similarly, the termination agreement required Orgeron to accept LSU’s continued use of his NIL, for him to “cooperate with LSU in any investigation” and other possibilities that would occur after he left the school.
While big-name college coaches signing term sheets often generate headlines, Orgeron v. Orgeron is a reminder that those deals are only “agreements to agree.” All that really means, the ruling explained, is “no agreement at all, since either party may avoid it by the mere failure to agree.”
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