What universities have laid off tenured math faculty for financial reasons? When a math department lays off tenured staff, people cry out loud.
But, 10 years later, such memories are no longer popular discussion subjects, and so the information doesn't always spread.
Those who lived through it will of course remember. But will the younger get to know of the troubled past of a given university?
I would like to record incidents of universities laying off tenured math faculty for financial reasons. If you know of such an event, please write the name of the university, the year when it happened, and the number of tenured faculty that got laid off. Other relevant information, such whether or not there was a lawsuit, aggravating circumstances, etc. should also be included.
(This is a follow up on this discussion about the VU Amsterdam laying off people.)
 A: Quoting from http://www.euro-math-soc.eu/node/3833, posted on May 29, 2013.


As result of a restructuring plan published two years ago, the Free University Amsterdam (VU) has now formally terminated the Geometry/Topology research programmes. The VU did not dismiss the members of the Geometry Section as originally planned, but the development has had serious consequences for several VU researchers:
    Tilman Bauer was allowed to stay on in his junior tenured position, relabelled as an "algebraist". However, he felt he could not continue working at the VU and he resigned from his position without having another job lined up. Fortunately, Tilman quickly got a position at KTH Stockholm. Jan Dijkstra was demoted from Professor to Lecturer. Jan has decided to leave the VU and The Netherlands later this year when he becomes eligible for early retirement. Dietrich Notbohm was demoted from Professor to Associate Professor on a temporary (5 years) contract.


A: A Google search of "tenured faculty layoffs" returns several instances in the US, in particular in the state of Florida, where layoffs of tenured faculty were planned. In a number of instances, e.g. Florida State University, these plans were rescinded after public brouhaha and legal fights. 
A: Two tenured professors at the University of Uppsala, Oleg Viro and Burglind Joricke, were forced to resign in 2007. The reason seems to have been a disagreement with the rector of the University, Anders Hallberg, over an appointment of an applied maths professor. (As far as I know, there weren't financial reasons involved, but still I thought it might be worthwhile to mention this here.)
More details can be found here http://www.pdmi.ras.ru/~olegviro/Uppsala-8-2-2007.html
A: Since other answers mention cases which were not financially motivated, here is another one:
Gutkin v. University of Southern California (2002)
The document below concerns the complaint Eugene Gutkin filed in 2001 against University of Southern California, which dismissed him in 2000. He appealed the decision and sought damages, but lost the case. I will quote the paragraph describing the circumstances of his dismissal; the full text is here:
http://law.justia.com/cases/california/court-of-appeal/4th/101/967.html
"Gutkin's complaint alleged that he was a tenured professor of mathematics at the University. In the wake of a dispute over the University's requirement that Gutkin teach extra classes to "make up" for classes he had not been able to teach in the fall 1995 semester, the University initiated dismissal proceedings against Gutkin in October 1996. But Gutkin's dismissal hearing was not scheduled to take place until early December 1998, because, according to Gutkin, "[i]t took [the University] longer than anticipated to effectuate the deceptive alterations to the [faculty] [h]andbook" that would govern the "rigged [dismissal] procedures," and the University "dragged its feet." Gutkin further alleged that by December 1998, "[the University] had not finished its tampering, so the deceptively altered [h]andbook was not ready for posting on the Internet by the time of the scheduled hearing. . . . Consequently, [the University] unilaterally postponed the hearing until February 26, 1999."
The dismissal procedure outlined in the faculty handbook required a hearing before a panel of Gutkin's faculty peers. According to Gutkin, the panel selection process set out in the revised faculty handbook constituted a "charade of impartiality" that resulted in a "sham dismissal procedure." In March 1999, the faculty panel issued a recommendation to the president of the University that found that Gutkin had engaged in "serious neglect of duty," a ground for termination in the faculty handbook. The president of the University terminated Gutkin in March 2000 for "serious neglect of duty," as found by the faculty panel."
A: The maths department at Bangor university in Wales was closed in only the past 10 years. This was, if I recall rightly, because they scored relatively poorly on a national 'research quality' exercise, one that has since been redesigned somewhat (though perhaps not so much, as Jose points out in the comments, for mathematics).
I'm not sure about the number of staff, but at least two: Tim Porter and Ronnie Brown, both considered senior category theorists (among other things). (Edit by Tim: There were three members of staff Gareth Roberts, Chris Wensley and myself. Ronnie had retired normally a few years ago, but was still research active (very!).  The RAE was partially to blame, and its methodology was too open to highly subjective judgements, but the causes were ultimately a shortfall in funding for the overall system together with power struggles within and between universities. The replacement REF (see later comments) will use bibliometrics that are highly contentious and unproven.)
(Since this is CW, I invite Tim or Ronnie to freely edit this answer and supply more details)
A: It would be a mistake to get the impression from these answers that the phenomenon of tenured mathematicians being fired for dodgy political reasons is purely a new thing. For instance in the early 1950s (under McCarthyism) Oklahoma A&M instituted a loyalty oath; Ainsley Diamond, a quaker, refused to sign it and was fired and Nachman Aronszajn resigned in protest. Both moved to the University of Kansas.
A: In the early 30s, André Weil was fired from Aligarh Muslim University ostensibly for not cooperating in holding elections to the students' union.  Read his own account of the whole episode in his Souvenirs d'apprentissage.
A: In the late 1970s Yeshiva University in New York closed down its Math graduate program and fired a couple of tenured professors. I don't recall the details, but I remember that the matter came up before the Council of the AMS.
A: Going a little further down in history is pretty easy to find examples of great mathematicians being fired by political reasons like D. Egorov in 1929 for being "a sectarian" and defending the church or E. Noether in 1933. 
