Scott Frost lawsuit against Nebraska heads to court over tax dispute
Former Nebraska football coach Scott Frost's lawsuit against the University of Nebraska landed in court this week.
But the sides aren't yet debating the allegations at the heart of the case, which involves the way in which the university included his buyout payments for 2025 and 2026 on his 2022 W-2, causing him significant tax liability.
At this stage, it's about whether the university could be sued over it at all.
Andy Barry, an attorney representing the Board of Regents who filed a motion to dismiss the case, said Thursday it came down to sovereign immunity and the way in which Frost's attorneys had asserted his claims.
In the suit's first claim, Frost seeks what's called a declaratory judgment, regarding the rights, duties and obligations under his employment agreement with his former employer over the "problems created for him by the university" after his termination.
Frost also is seeking damages of at least $5 million over the university's alleged breach of contract.
In December, Frost, now the head coach at University of Central Florida, sued the Board of Regents over his 2022 W-2, which included the "present value of the 2025 and 2026 liquidated damages payments" and totaled $9.5 million — far more than the $4 million salary he was paid for the 2022 season.
By doing so, the university was able to take tax deductions for the payments.
But, according to the lawsuit, it also created a $1.7 million tax liability for income Frost hadn’t received and led to legal fees and late filing penalties.
Frost first filed a claim with Nebraska’s State Claims Board, but the university objected. So Frost turned to the courts.
In the lawsuit, he claims he is owed $5 million — $2.5 million each for the 2025 and 2026 seasons as an "offset" portion of his contract — from the university for damages.
Nebraska’s position is that Frost’s UCF salary, which started at $3.9 million, exceeds $2.5 million in 2025 and 2026, so Frost is owed nothing.
At a hearing Thursday, Barry said because the university is a state agency, sovereign immunity applies, and, because the first claim is asserted under the Uniform Declaratory Judgments Act, it's barred.
"So we think that resolves the issue purely and simply here today," he said.
As for the second claim seeking damages, Barry argued the university hadn't waived sovereign immunity on that claim either.
Frost's attorney, Josh Dickinson, said: "I think we can all agree there's not case law on point."
He said in a prior case the Nebraska Supreme Court could have said that sovereign immunity bars all declaratory judgment actions but didn't.
He said it was unnecessary for the court to grant the motion to dismiss at this early stage.
"It's not going to change the scope of the case. Ultimately, the case is about: Was the contract followed by the university or does Coach Frost have a legitimate grievance?" Dickinson said.
He said it could be revisited later.
But Barry said the court has an obligation to rule on the motion and decide whether it's the proper venue to hear the case.
"Sovereign immunity protects the state from even having to appear in court," he said.
Lancaster County District Judge Kevin McManaman took the matter under advisement.
A trip through the years with Scott Frost, who starred at Nebraska as quarterback but went 16-31 as Husker head coach from 2018 to 2022.
Reach the writer at 402-473-7237 or lpilger@journalstar.com.
On Twitter @LJSpilger and Bluesky @ljspilger.bsky.social
