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Joe Paterno Struck Lucrative Contract Deal Months Before Sandusky Story Broke

An interesting report from The New York Times:

In January 2011, Joe Paterno learned prosecutors were investigating his longtime assistant coach Jerry Sandusky for sexually assaulting young boys. Soon, Mr. Paterno had testified before a grand jury, and the rough outlines of what would become a giant scandal had been published in a local newspaper.

That same month, Mr. Paterno, the football coach at Penn State, began negotiating with his superiors to amend his contract, with the timing something of a surprise because the contract was not set to expire until the end of 2012, according to university documents and people with knowledge of the discussions. By August, Mr. Paterno and the university’s president, both of whom were by then embroiled in the Sandusky investigation, had reached an agreement.

Mr. Paterno was to be paid $3 million at the end of the 2011 season if he agreed it would be his last. Interest-free loans totaling $350,000 that the university had made to Mr. Paterno over the years would be forgiven as part of the retirement package. He would also have the use of the university’s private plane and a luxury box at Beaver Stadium for him and his family to use over the next 25 years.

The university’s full board of trustees was kept in the dark about the arrangement until November, when Mr. Sandusky was arrested and the contract arrangements, along with so much else at Penn State, were upended. Mr. Paterno was fired, two of the university’s top officials were indicted in connection with the scandal, and the trustees, who held Mr. Paterno’s financial fate in their hands, came under verbal assault from the coach’s angry supporters.

Board members who raised questions about whether the university ought to go forward with the payments were quickly shut down, according to two people with direct knowledge of the negotiations.

In the end, the board of trustees — bombarded with hate mail and threatened with a defamation lawsuit by Mr. Paterno’s family — gave the family virtually everything it wanted, with a package worth roughly $5.5 million. Documents show that the board even tossed in some extras that the family demanded, like the use of specialized hydrotherapy massage equipment for Mr. Paterno’s wife at the university’s Lasch Building, where Mr. Sandusky had molested a number of his victims.

The details of Mr. Paterno and his family’s fight for money seem to deepen one of the lasting truths of the Sandusky scandal: the significant power that Mr. Paterno exerted on the state institution, its officials, its alumni and its purse strings.

Since Paterno opened these negotiations at virtually the same time the vultures were starting to circle around Sandusky, is it fair to say he decided to get a deal in writing before the story exploded all over Happy Valley, thus eventually netting his family millions of dollars? I report, you decide.

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About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May, 2010 and also writes at Below The Beltway. Follow Doug on Twitter | Facebook

Comments

  1. PJ says:

    The president of Nike Inc. says he has decided to change the name of the Joe Paterno Child Development Center, a child care facility at the company’s headquarters.

    While it wasn’t named the Jerry Sandusky Child Development Center, why did it take this long for Nike to decide to rename it?

    Like or Dislike: Thumb up 4 Thumb down 0

  2. al-Ameda says:

    In the end, the board of trustees — bombarded with hate mail and threatened with a defamation lawsuit by Mr. Paterno’s family — gave the family virtually everything it wanted, with a package worth roughly $5.5 million. Documents show that the board even tossed in some extras that the family demanded, like the use of specialized hydrotherapy massage equipment for Mr. Paterno’s wife at the university’s Lasch Building, where Mr. Sandusky had molested a number of his victims.

    No wonder Paterno chose the wrong path. What a weak and venal man.
    This story just keeps getting worse.

    I’m not an attorney, but I assume that just because Joe Paterno is deceased that does not mean his estate is now free of financial liability should there be litigation concerning his role in covering up the criminal behavior of Jerry Sandusky..

    Like or Dislike: Thumb up 7 Thumb down 0

  3. mattb says:

    @al-Ameda:

    I’m not an attorney, but I assume that just because Joe Paterno is deceased that does not mean his estate is now free of financial liability should there be litigation concerning his role in covering up the criminal behavior of Jerry Sandusky.

    IANAL (but I live with one) and my understanding is that there is easily enough evidence to allow a civil suit that includes the Paterno estate to go forward.

    Whether or not the Jury agrees that there is enough to hold the estate civilly responsible is another thing entirely.

    Like or Dislike: Thumb up 7 Thumb down 0

  4. john says:

    @PJ: yeah looks like joe was covering up, maybe they should name it jerry sandusky lol
    what do you think? coachjoepa.com

    Like or Dislike: Thumb up 0 Thumb down 5

  5. john says:

    so was joe paterno covering up?
    what do you think?
    http://www.coachjoepa.com
    write your thoughts and read others.

    Like or Dislike: Thumb up 0 Thumb down 6

  6. Heh, The Second Mile has apprently transfered all its assets to “Arrow Child & Family Ministries”:

    http://www.huffingtonpost.com/2012/06/20/second-mile-sandusky-charity_n_1611058.html

    This is a Christian Charity tied to Michael Reagan that requires all employees to sign a statement of faith, and refuses to serve non-Christian couples. So all those donations that were given to a secular charity (including various forms of government funding) are going to be turned over to a fundamentalist christian organization.

    Like or Dislike: Thumb up 3 Thumb down 2

  7. nightrider says:

    So really, isn’t it about time that we revisit the wrongness of making college football coaches the highest paid public employees in the entire country? Economics blah blah blah, it is wrong and we are the ones with the power to stop it and invest in real priorities.

    Like or Dislike: Thumb up 5 Thumb down 0

  8. Janiah says:

    @Stormy Dragon: Oh that is awful. A twenty year old Christian charity founded by a former foster child who was abused is taking over the programs of the Second Mile, if a court approves. Surely they should not be allowed to help abused orphans, since they are Christians.

    Don’t know what you have against Michael Reagan, but he works with one of the group’s programs, but is not its leader or on its board. Since he was abused and is an adoptee maybe he had an interest in helping kids, but then again he’s a Christian so he shouldn’t be allowed to help. Maybe if he was a self-absorbed football coach with a genius for self-promotion it would have been OK.

    This charity is so awful it got tax support from the state of Maryland, which everyone knows is a fundamentalist red state.

    It would have been better to shut down the kids’ programs rather than let Christians help the kids. This whole thing is so horrifying it makes what Sandusky and Paterno and Spanier and their enablers do look like chump change.

    Maybe it won’t happen since the whole thing has to be approved by a secular state court in Pennsylvania first. That’s another state full of evil fundamentalists however so there is probably no hope for the kids.

    Like or Dislike: Thumb up 1 Thumb down 6

  9. DRS says:

    Hey, Janiah, can you turn off the self-pity tap, please? You’re overflowing all over the rug.

    And you might want to address the issue that Stormy makes: donations made to one organization that is secular and open to all faiths, will now be turned over to one that serves one faith only. You do recognize that that might be troublesome for people, don’t you?

    I don’t think it’s terribly Christian to not serve every child in the community who’s suffered physical or sexual abuse, but hey, maybe the congregation you belong to doesn’t remember Jesus’ injunction to let all the children come to Him. I’m glad I don’t belong to it.

    You are a weak Christian.

    Like or Dislike: Thumb up 5 Thumb down 2

  10. Janiah says:

    @DRS: That’s not self-pity, it is sarcasm. Never saw anyone confuse the two before.

    Stormy didn’t do his or her research and neither have you. The funds to be transferred were going to be used in a secular manner, according to numerous news stories.

    I never heard of this charity before Stormy’s comment but read a bunch of news stories and the group’s website before commenting. I needed to know if I needed to start living under the bed, because the scary Christians were coming.

    Like or Dislike: Thumb up 1 Thumb down 2

  11. DRS says:

    If you truly meant it as sarcasm, then I apologize.

    Like or Dislike: Thumb up 2 Thumb down 0

  12. Janiah says:

    @DRS: DRS, thank you. That is kind of you. I did mean it as sarcasm, but apparently I should write more often, to get more practice, as I am not very good at it yet! Best to you.

    Like or Dislike: Thumb up 1 Thumb down 0

  13. @Janiah:

    I never heard of this charity before Stormy’s comment but read a bunch of news stories and the group’s website before commenting.

    Not very carefully apparently:

    http://www.arrow.org/site/tx/family/adoption/what-it-takes-adopt.html

    •Applicants are mature, stable individuals or couples that profess a relationship with Jesus Christ, and share our Christian values as outlined in our Statement of Faith and Guiding Principles, as well as, share our passion of helping kids and strengthening families. Parents will be expected to demonstrate their active Christian lifestyle and church involvement throughout the screening process, and must be willing to provide a reference from someone in their church leadership.

    Oh yeah, that’s a real “secular manner” those funds are going toward.

    And as to Michael Reagan “just working with one of the programs”, you fail to mention that the program in question is the Michael Reagan Center for Advocacy & Research. That is, a lobbying shop to futher his political agenda, which includes things like outlawing divorce and homosexuality.

    As a former donor to Second Mile, I’m enraged that my own money is getting funnelled into an effort to lobby the government to throw me in jail because I’m no straight. What about the families of gays and lesbians? Don’t they deserver to be protected too?

    Like or Dislike: Thumb up 2 Thumb down 1

  14. Janiah says:

    @Stormy Dragon: Stormy, you are being silly. It seems you are trying to find a way to make yourself a victim here, but this isn’t about you and you aren’t following along well in your research.

    Point 1. The transferred funds will be used in a secular manner. That doesn’t mean the funds the Christian charity raised on its own must be used in a secular manner, or that the charity itself is not allowed to follow the tenets of the religion of its choice.

    Point 2. The US government gives billions a year to religious charities for social service functions carried out by religious organizations in a secular manner. They do this thing called accounting to keep secular funds separate from other funds. This situation is nothing more than a small scale version of the same, except the funds are coming from a charity that is (I presume) closing, as opposed to from the government, and of course there was a scandal involved.

    Point 3. Michael Reagan does not support outlawing divorce or homosexuality, but even if he did, my statement that he is not the CEO of the group or on its board remains accurate.

    Point 4. If you are a “former donor” to Second Mile, you could ask for your money back, though if the donation(s) was a while ago, your gift(s) may already have been spent under the leadership of Jerry Sandusky instead of those dangerous Christians. So you could rest easy in that case.

    Point 5. What you do in bed is totally irrelevant to this conversation. Try to get over yourself.

    Like or Dislike: Thumb up 0 Thumb down 0