That's not the same thing as what we're discussing. Jags isn't trying to hold BC hostage, he's simply trying to get himself a better and more lucrative position. Unless there is a clause in his contract that expressly forbids it, it is legal for him to pursue another job.
Below is a portion of a sample NCAA head coaching contract (Lisa Bluder, head women's basketball coach at Iowa). I'm not claiming Jagodzinski's contract is exactly like this, but from what I have heard/read, this type of clause is pretty standard these days:
"Cause" usually refers to morals or NCAA violations. Firing the coach without cause would seem to be the case with Jagodzinski.
So, if I'm reading this correctly, the University can fire the coach at any time without cause and if they do the coach receives their pay and benefits. These amounts will not be reduced if the coach gets another job during this contract time.
It's good to be a coach!!!
http://www.desmoinesregister.com/assets/pdf/LisaBluder_contract.pdf