On October 17, 2011, the Minnesota Court of Appeals upheld a $1 million verdict against Tubby Smith and the University of Minnesota in Williams v. Smith et al.  The unpublished opinion of the Minnesota Court of Appeals is available here.
In the case, Jimmy Williams, a former assistant men’s basketball coach at Oklahoma State University, alleged that Tubby Smith, the men’s basketball coach at the University of Minnesota, made a negligent misrepresentation that harmed Williams when Smith falsely represented that he had authority to hire Williams as an assistant basketball coach for the University of Minnesota in the spring of 2007.
To succeed on a negligent misrepresentation claim, a plaintiff must prove that:

  1. The defendant owed a duty of care in conveying information;
  2. The defendant breached that duty by negligently providing false information;
  3. The plaintiff reasonably relied on the misrepresentation; and
  4. The plaintiff’s reliance proximately caused damages.

After a jury trial, the district court held that Williams proved all of the elements for negligent misrepresentation because he showed that:  (1) Smith falsely represented to Williams that he had final authority to hire assistant basketball coaches at the University of Minnesota; (2) Smith failed to use reasonable care, either in obtaining information pertaining to his hiring authority or in communicating information about his hiring authority to Williams; (3) Williams relied on Smith’s misrepresentation by quitting his job at Oklahoma State University; (4) Williams’s reliance was reasonable; and (5) Williams was harmed by the reliance because it caused him to lose income.  The jury initially awarded Williams $1,237,293 in damages, but the district court reduced the award to $1 million in damages under the Minnesota Tort Claims Act.  See Minn. Stat. § 3.736.  The Minnesota Court of Appeals affirmed.
Under Minnesota Rule of Appellate Procedure 117, Tubby Smith and the University of Minnesota have 30 days to petition the Minnesota Supreme Court for review of the decision.  If appealed, the Minnesota Supreme Court will have discretion to determine whether or not to hear the case.
Takeaway for Employers:  The Williams case is a reminder that it is important for employers to have clear hiring procedures and to communicate clearly who has hiring authority and who does not.