Looks as if I was wrong that CBS doesn’t have at least a colorable argument that it had grounds to terminate Don Imus’ contract for cause. This NY Times article reports that CBS has refused Imus’ demand to pay him the balance of the compensation under the contract and that Imus is preparing to sue CBS for terminating Imus’ contract for cause. Apparently, CBS is relying on a provision of the contract that appears to shift some termination risk to Imus if he made a controversial statement on the air that placed the network at risk of regulatory sanction.
Although different jurisdictions have varying standards for deciding such cases, CBS would have a tough case to make if Texas law controlled the dispute. CBS encouraged Imus’ offensive statements for years before his insult of the Rutgers women’s basketball team blew up in Imus and CBS’ collective faces. My bet is that the case is settled before too long with Imus taking a small discount for what he is owed under the contract in the settlement. But not before the lawyers on both sides take their cut. ;^)