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Nowak sues the Union

Photo: Daniel Gajdamowicz

[UPDATE: Jonathan Tannewald has updated his original article with a quote from Nick Sakiewicz that says, “The team disputes the allegations in the complaint and will vigorously defend against the lawsuit.”]

Former Philadelphia Union manager Peter Nowak has sued the Union for wrongful termination and breach of contract in connection with his firing on June 13.

In documents filed on July 20 with the US District Court, Eastern District of Pennsylvania, Nowak claims his former club did not act in good faith when it fired him.

Nowak’s suit, first reported by the Philadelphia Inquirer, revolves around the issue of severance pay. Nowak claims that he is entitled to payment through the end of his original contract term of 2015, by which time his yearly salary would have been $408,446.

A separation agreement letter from the Union argues that Nowak is due payments of his current regular monthly base pay of $31,087.50 through December 31, 2012.

Under the Union’s offer, Nowak had until July 20 to sign the separation agreement.

When he did not do so, the club issued a letter of cause for termination, outlining the reasons behind his firing. These include:

  • Various material breaches of MLS rules, including the league’s collective bargaining agreement, such as engaging in verbal and physical confrontations during games, interfering with the right of players to contact the players’ union with concerns, subjecting players to inappropriate hazing activities and engaging in behavior that put the health and safety of Team players at risk;
  • Violating his employment agreement by actively seeking employment with a European club and making disparaging remarks to third parties about the club, its management and owners;
  • Demonstrating gross negligence by putting the health of players at risk by requiring injured players to train, denying water to players during training, ignoring the advice of the team’s head trainer regarding which players are healthy enough to play in games, and creating an environment where players should hide injuries from team medical staff;
  • Committing actions which reflect negatively on the team, including harsh treatment of players, inappropriate behavior during games, and engaging in discussions with the head of US Soccer that were in poor taste and left a bad impression with the federation.
  • Multiple incidents of insubordination with the team’s CEO.
  • Breaches of Team Rules, including creating a hostile work environment and  culture of fear for team players and front office staff through verbal and physical intimidation.

The termination letter also serves notice that Nowak must immediately repay an unsecured loan of $60,000 from when his contract was extended in 2011 as well as prepaid marketing rights fees to the amount of $46,041.

Documents included in the filing, including his original contract, reveal Nowak made $373,050 in 2010 and 2011.

Among the benefits of his employment were a “use of an automobile, the make and model of which shall be mutually agreed upon by Manager and Club,” 16 round-trip airline tickets for the use of Nowak and his family between Philadelphia and Naples, Florida, a minimum level of business class for any air travel in excess of 3 hours,”and all international flights and hotel accommodations will be at least a Junior Suite.”

 

 

 

19 Comments

  1. I think it’s great that this allowed us all to find out just how bad Nowak was and that ownership thought so too. The worst thing though is finding out that he made more than almost anyone else on the team.

  2. Philly Cheese says:

    Just what the Union needs…….more financial obligations to pile on an already fragile base. Even if all the allegations of “cause ” are true, the legal fees for a proven belligerent Nowak are going to mount. Not a good welcome to Philadelphia for All Star media to grab onto.

  3. JediLos117 says:

    I guess he didn’t get the job…

  4. I want his agent…

  5. A few thoughts on this:

    1. Nowak was getting $380k salary + 85K for marketing rights (the Pino payment) + a 60k loan + a car and airplane tickets. Not a bad package for a coach for what all of the soccer snobs would call 3rd or 4th rate league. Also, more than any player on the team except Freddy Adu ($519k).

    2. Because of the termination, Nowak owes a prorated share of the Pino payment and the balance on the loan – roughly $100k. That is certainly part of the reason for the lawsuit – trying to force a settlement on that amount. He is seeking a ruling that the termination was not “for cause”, and, thus, he is entitled to payment of his contractual base salary and benefits through 2015 – i.e., payment of over $1M over the next 3 ½ years (and possibly another $300k in Pino payments).

    3. Critically, other than saying that the “for cause” termination is not in good faith, Nowak does not deny the factual basis of the enumerated “causes” for termination. In my experience, it would common to add some sort of statement that the stated “causes” were fabricated, inflated or otherwise without basis. However, here, Nowak’s position is simply that the “causes” were curable or, alternatively, that the Union failed to comply with the termination provision procedurally. In other words, he attacking the technicalities of the Union’s compliance, not that he did not do the things the Union accused him of doing.

    4. Nowak obviously knew that the “for cause” letter would eventually find its way into the public. This lawsuit is his chance to try to cut it off minimize the effect on his reputation – he is trying to get out in front of it instead of being asked to respond to the allegations of the letter. He may actually have an argument here, although written notice and opportunity to cure only apply to III.A.2, 3, and 7 in his agreement – which is why the “for cause” letter repeatedly invokes the language from III.A.5 (“public disrepute”).

    5. Given the timing, what is stated in the termination letter, and Nick Sak’s comments at the announcement of the termination, we can see that (a) Nowak absolutely applied for the Hearts job and (b) Nowak took the position that he did not have to report to Nick Sak. Make no mistake about it, applying for the Hearts job — while the Union was in an awful skid (and trading away it most popular players) and Nick Sak was taking heat and defending his manager — was the proverbial last straw.

    6. The Union most likely anticipated this lawsuit. Why would Nowak go away for net $70k (approx $170k less repayments of approx $100k), when he could claim entitlement to, potentially $1.3M (plus attorneys’ fees and a 25% “kicker” if suing under Pennsylvania’s Wage Payment Stature).

    • Great points! Spot on. You just stole my column for tomorrow. 😉 The only thing I’m not so sure of is the “for cause” letter finding its way to the public. I don’t think it comes out if not for the lawsuit. Nothing peels back the layers of the onion like a lawsuit.

      • Sorry. There is more analysis that can be added to this, including exactly whether the timing of the lawsuit was really intended as an “effe you” to the U on the eve the MLS ASG events. You still have shot to do much better than I have here.

      • Dan Walsh says:

        Oh, don’t be sorry. I think it’s awesome. Good comments like that really add to the site and get conversations going among the readers and writers.

    • I see there is a lawyer among us. I didnt understand most of that…

  6. Can I sue Nowak for all my expenses during the 2011 season when I had season tickets? 6 hour round-trip drives to Philly each time.

    I think Nowak should also pay for damages for trading away Le Toux, Mwanga, and Califf.

  7. What happened to poor on the field team performance as a reason to fire him!!!! Nonsense.

    The sad part is that the Union will settle to avoid long and expensive litigation.

  8. My hopes:
    1. SoB attorneys will help litigate to minimize costs to the club.
    2. Union will not have to pay Nowak another dime.
    3. That prick Never. Coaches. Again.

  9. BeenThere, DoneThat says:

    Having read Tannenwald’s article earlier, I think Nowak’s best choice would’ve been signing the Separation Agreement when it was offered. (If you lost your job, would you turn down *31 grand a month* through the end of the year? Me either.)

    I think this legal action is the famous ego still at work. When the case is decided against him, he won’t get that 31 grand. Monthly. For not working.

  10. Nowaky ! Also hope he never coaches again, he is bad for U.S. Soccer.
    Go Union!

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