Penn State Trustees' Feud Flares Again Over Report of Possible Settlement in NCAA Lawsuit
January 12, 2015 5:50 AM
by Steve Bauer
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Could a deal be in the works that would derail a lawsuit filed against the NCAA by Pennsylvania State Senator Jake Corman and Treasurer Rob McCord?

Two Penn State trustees say they've been told about a possible settlement, however, it's unclear exactly what's actually happening.

Anthony Lubrano and Al Lord, issued a news release Monday saying they have learned "settlement terms in the McCord/Corman/NCAA litigation have been proposed by Penn State to the NCAA." The two men go on to say they have not been able to confirm this with board chair Keith Masser. The two also released a harshly-worded letter that was sent to Masser.

Lubrano tells StateCollege.com, "We've been hearing things and we don't like what were hearing."

A report published by the Philadelphia Inquirer, cites unidentified sources as saying the proposed settlement involves the return of 112 football victories the NCAA stripped from Penn State. The settlement would also allow state officials and Penn State control the disbursement of the $60 million the NCAA ordered the university to pay.

Penn State is a co-defendant in the case against the NCAA. The lawsuit was filed in an effort to force the NCAA to comply with terms of the Endowment Act. The act requires that the $60 million fine be spent on programs to assist children within the state of Pennsylvania.

The NCAA has maintained the Endowment Act is unconstitutional and has filed its own lawsuit in federal court.

A statement released by Corman's office says Corman is still preparing to take the case to trial. That trial is set to begin on February 17th. However, Corman has left the door open to talks that could lead to a resolution. Corman's statement does not deny that there might have been negotiations, but says "To date, I have not agreed to any settlement or proposed resolution."

The NCAA originally declined to comment on reports that a settlement has been proposed. However, a statement from Bob Williams, the NCAA's senior vice president of communication, was released on Tuesday. It says, “As with any other litigation, parties periodically discuss settlement and this case is no different. However, we’re not going to discuss specifics related to any possible settlement talks in the Corman litigation or any other case.”

The lawsuit will decide the validity of the consent decree Penn State signed with the NCAA. The consent decree paved the way for the NCAA to impose harsh sanctions against the university, including the $60 million fine, the loss of football scholarships, the vacation of 112 football victories and a ban on bowl game appearances. Some of those sanctions have since been lifted.

Lubrano and Lord were both elected to the board by Penn State alumni, along with seven other board members, in the wake of the Sandusky scandal. The alumni-elected board members have been waging a battle to reform the board and have been harshly critical of how other board members handled fallout from the Sandusky child sex abuse scandal.

In a separate letter addressed to Masser, Lubrano and Lord claim that Masser ignored an email and phone call from Lubrano asking for details about a reported settlement deal.

The letter to Masser, which clearly illustrates the rift between the two factions within the board, says, "Your repeated claims that our Board now conducts business with greater openness, inclusivity, and transparency ring hollow because you regularly operate in a disturbingly secretive and non-inclusive manner.

"... we must presume that you and quite possibly other November 2011 trustees and certain handpicked successors are aware of [the proposed settlement with the NCAA]." The 2011 reference refers to members who were on the board when the Sandusky scandal exploded in the national headlines.

"Keith, you have led your unelected majority to put the University into an adversarial position with the Commonwealth of Pennsylvania and with the Paterno family. How much farther down this ill-advised road will you go?"

The letter asks that the terms of the proposal be shared with the entire board "immediately."

Lubrano also released a copy of his email to Masser which said in part, "For brevity, any proposal that does not void the Consent Decree Ab initio (a legal term meaning "from the beginning") will be roundly rejected. Furthermore, any proposal that suggests the NCAA had the authority to act will likewise be rejected."

Late Monday, Penn State released Masser's response to Lubrano and Lord: "First, the suppositions that you present in your letter are incorrect. Second, as you are aware, the Board created a Subcommittee on Legal to oversee and provide guidance with respect to University legal matters. The Legal Subcommittee meets on a weekly basis to hear updates from counsel and to discuss outstanding legal matters. When it is appropriate to bring a matter to the full Board for its information or action, I trust that the Legal Subcommittee will do so.

"With respect specifically to the Corman v. NCAA litigation, you have previously been informed that any proposed settlement would be brought to the Board for its approval. Finally, it would be very damaging to the University to publicly discuss the possible terms of settlement of any litigation under discussion or consideration by the parties."

Penn State spokesperson David La Torre says the university will have no further comment.

At the board's meeting in November, Lubrano had a proposal of his own -- for Penn State to switch sides in that lawsuit. That proposal followed the release of legal documents in which NCAA officials questioned whether the athletic organization had the authority to impose sanctions again Penn State in the wake of Sandusky scandal. One document suggested the NCAA was "bluffing" when it threatened sanctions in the first place.

The alumni-elected trustees called a special meeting in December to discuss switching sides in the NCAA lawsuit, but the other board members boycotted the session.

In the wake of that meeting, Masser released a statement saying, it was "disappointing" that the alumni-elects continued to focus on an issue that the board "has already considered at numerous meetings."

Editors note: This story has been updated to include details of a possible settlement reported by the Philadelphia Inquirer and a statement issued by the NCAA.

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