The legal status of tenure rights threatened by financial exigency and the role of the American Association of University Professors in protecting those rights are considered. Accommodations of competing managerial, employee, and institutional interests that must be addressed are also discussed. Court cases are reviewed that deal with managerial authority to dismiss tenured faculty. The cases appear to hold that such power is inherent in the authority needed to manage an institution. To identify what constitutes financial exigency, cases and policies are reviewed, and the following issues are raised: what funds are considered and whether the entire institution must be threatened. In considering means of alleviating financial exigency, the following concerns are discussed: whether there is a duty to place the tenured professor in another suitable position, whether non-tenured faculty must be dismissed prior to dismissal of tenured faculty, less drastic means which do not alter faculty rights, and unilateral actions affecting tenure rights. It is concluded that the decisions reviewed indicate that the proper forum for protecting academic freedom in the first instance is academia itself (through express and implied academic contracts), and the judiciary should be a last resort. (SW)