Baylor University and the Baylor Alumni Association announced Tuesday that they have agreed to settle their bitter, long-standing legal battle symbolized by the wrecking ball Baylor took to the BAA’s campus headquarters.
In a joint statement, Baylor and the BAA announced that they have resolved their dueling lawsuits, claims and counterclaims that raged in the shadows while Baylor was enjoying unprecedented campus growth, national athletics recognition and academic notoriety.
“The ultimate goal of both university and BAA leadership has been to bring about a unified effort among all members of the Baylor family to continue to move Baylor forward in a positive direction,” Baylor President and Chancellor Ken Starr said. “This agreement, with its emphasis on cultivating strong relationships between all alumni and their alma mater and its firm commitment to support student scholarships, is the remarkable result of diligent work by a group of dedicated servant leaders, for whom we are deeply grateful.”
Under the terms of the agreement, Baylor will pay the former BAA $2 million for tearing down the Hughes-Dillard Alumni Center on University Parks Drive, but the BAA will have to change its name and not hold itself out to be an “alumni association.”
Baylor will continue to operate its own Baylor Alumni Network.
BAA president Tom Nesbitt said the BAA’s name most likely will change to the Baylor Line Foundation, subject to a vote of its membership.
The association will continue to publish the Baylor Line alumni magazine with editorial independence and continue operating as a nonprofit organization that Nesbitt said will raise money and provide scholarships to students.
Alumni also will be able to elect three people to the Baylor Board of Regents. The new members will be elected initially to staggered terms and have full voting privileges. Except for two of the initial members, the alumni representatives will serve three-year terms on Baylor’s governing board.
“The settlement agreement will also usher in a new era of governance at Baylor University,” Nesbitt said in a letter to be sent to alumni. “Under the agreement, all Baylor alumni will now have the right to vote in elections to name three members of the Board of Regents to full voting seats. Never before in Baylor’s history have the alumni had the right to directly elect members to the Board of Regents.”
In exchange for the $2 million, the BAA will waive its rights to a replacement for its on-campus headquarters. The BAA can use the money in any way that furthers the organization’s charitable purposes, Nesbitt said, including publishing the Baylor Line, securing a new headquarters and awarding scholarships.
“With this lawsuit behind us, we look forward to ushering in an exciting new chapter for our members and for Baylor, an institution we all hold dear,” Nesbitt wrote to BAA members. “We are eager to move forward together — united as one Baylor family.”
If the parties do not agree on the initial three regent selections, the settlement will be negated. Also, if BAA members reject the BAA’s new name, Baylor has the right to render the entire settlement agreement null and void, Nesbitt said.
Buddy Jones, a former BAA president and former chairman of the Baylor Board of Regents, said he is tempted but will resist “spiking the ball in the end zone in celebration following this Baylor milestone event.”
“But now that the litigation is concluded, I must say I am ecstatic for Baylor University today,” Jones continued. “First of all, Baylor recognized the immense problem it was faced with in the form of the watchdog Baylor Alumni Association, which left the school without a real, supportive bona fide alumni organization to help address it. Next, Baylor employed steely determination to cure this antagonistic dilemma by creating the Baylor Alumni Network and actively prosecuting this litigation to rid itself of this obstacle to our progress.”
Judge Gary Coley Jr. deferred ruling on Baylor’s motion to dismiss a portion of the lawsuit after a hearing Jan. 21 because attorneys on both sides informed the judge recently that a settlement was imminent. A trial of the case was set for March 28.
Baylor sued the BAA in June 2014, alleging the association was improperly using Baylor’s name and trademarks. The school moved to cut licensing agreements with the BAA in December 2013 following failed attempts to merge the alumni association with Baylor’s in-house alumni network.
The BAA countersued, contending that Baylor breached its contract with the association, conspired to silence the BAA’s independent voice by trying to put it out of business and improperly tore down its campus headquarters under false pretenses that the area was needed to build a walkway over the Brazos River to the new McLane Stadium.
The university was seeking a judgment that the BAA be terminated or re-formed and limited to helping students with financial aid.
Lyndon Olson, a member of the BAA board of directors and former U.S. ambassador to Sweden, and Starr asked U.S. District Judge Ed Kinkeade, a Baylor law graduate, to serve as an unofficial mediator between the parties.
Nesbitt said Kinkeade, of Dallas, spent “countless hours” for almost six months and “encouraged, cajoled and hounded” the litigants to reach an agreement.
“This is a creative and visionary agreement because it preserves the BAA’s existence and strengthens its independent voice, gives all alumni a powerful role in the governance of the university and honors the university’s desire to unify alumni programming in the Baylor Network,” Olson said. “It is a rare thing for institutions to go to war and for everybody to come out a winner. Here, I believe everybody wins.”
Jones said Tuesday that now that the lawsuit is settled, Baylor “is now unshackled by this age-old drawback, artificially created in a previous century.” He referred to the BAA as “toxic, harmful and bizarre” and said its actions were detrimental to the university.
“No more contracts in perpetuity. No more snarling watchdog organizations on campus to find fault with the great things happening at Baylor. No more confusion among the Baylor Nation as to what the university’s official alumni outreach consists of,” Jones wrote in his statement.
As the lawsuit was being prepared for trial, BAA members released two sets of incendiary emails from top Baylor administrators and members of the Board of Regents that showed the commitment by some, including Jones, to force the BAA off campus and out of business.
Among the major revelations in the emails is an exchange suggesting that Baylor moved to demolish the Hughes-Dillard Alumni Center, the BAA’s longtime headquarters, to diminish the group’s visibility on campus, and not because the building’s placement would interfere with a plaza to the pedestrian bridge connecting McLane Stadium to the main campus, as Baylor officials argued during a July 2013 hearing over the building’s fate.
“Can’t wait to tear that building DOWN!!!! If it is tied to the stadium, few will complain! :-) How sweet it will be!,” Baylor Vice President for Constituent Engagement Tommye Lou Davis wrote in an April 4, 2012, email to Jones, who was then regent chairman.
In the exchange leading up to that email from Davis, Jones wrote, “I hate them,” to which Davis replied, “That makes two of us. Irrelevant twurps.”
Four minutes later, Jones responded, “They are in my sight.”
During a Feb. 28, 2011, email exchange between Davis and Jones anticipating that the BAA eventually would have to fold into the university-run Baylor Alumni Network, Davis wrote, “I am measuring for curtains every time I go into the building! ;-),” referring to the Hughes-Dillard Alumni Center.
In the second set of emails released by the BAA in August 2015, Jones refers to the BAA as “terrorists” and Baylor discuss their goal of “driving the BAA out of business.”
In a March 15, 2011, email to Starr from his former chief of staff, Karla Leeper, Leeper told Starr that former Regent Dary Stone “believes that someone is working intentionally at cross purposes with our strategy of driving the BAA out of business.”
In an email the month before, Davis tells Jones, “Don’t ever doubt how I feel about the BAA. I have a strategy. They need to go away. I am and will continue to work with that goal always in mind.”
Since the first round of emails was released in June, Davis and Starr have apologized and said they regret the wording of those emails. Starr added he has encouraged Baylor to embrace what he called the “pivotal words” of “courtesy, respect and hospitality” toward the BAA and others.
At the January hearing in which Baylor was seeking partial summary judgment, one of the university’s lawyers, Steve McConnico, summarized the dispute for Judge Coley.
“Baylor has had an association with the Baylor Alumni Association for over 150 years,” McConnico said. “Most of the time, it has been good for Baylor and good for the Baylor Alumni Association, and the university is very appreciative of what it has done. But recently, the BAA has not served Baylor’s best interest, and that is why we are here.”
McConnico argued that agreements in perpetuity, such as the one with the BAA, are not valid and can be terminated at will. He also told the judge that the terms of the agreement between Baylor and the BAA are too vague to be enforced. McConnico argued that so much has changed at Baylor since a 1994 agreement was signed and that it would handicap Baylor’s progress for the vague agreement to be upheld.
In the 1994 recognition and license agreement between Baylor and the BAA, Baylor recognized the BAA as the official alumni organization of Baylor University.
In exchange, the BAA agreed to “support the purpose and goals of Baylor University as expressed in its original charter.”
Also, the BAA agreed to serve as the general alumni organization for all of Baylor’s schools and colleges, maintain an office on Baylor’s campus, carry out all of the objectives set out in the BAA bylaws and constitution, publish an alumni magazine, and organize and sponsor homecoming activities.
“Baylor has a fiduciary duty, and they can’t be bound by agreements made decades ago that tie their hands to where they can’t do what’s best for the university,” McConnico said.
Austin attorney Shannon Ratliff, one of several attorneys who represent the BAA, argued that it is hard to imagine that when former Baylor President Herbert Reynolds signed the agreements with the BAA that he didn’t intend them to be enforceable.
“The courts are here to enforce agreements between parties and are not here to nullify solvent agreements between people,” Ratliff said. “Baylor says the agreements are not enforceable because it improperly binds future administrations and board of regents. I suspect Baylor has numerous contracts that extend beyond the life of the current regents and President Ken Starr. Are they going to argue that those are not valid?”