It wasn't grounds. It was an excuse. What he said ("That's why I have decided to announce my retirement effective at the end of this season. At this moment the Board of Trustees should not spend a single minute discussing my status. They have far more important matters to address. I want to make this as easy for them as I possibly can. ") has multiple meanings: one could be perceived an insubordination (although even that is a stretch), and the other is "The university has way more important things to worry about (child abuse victims) than me." Anyone who had heard Paterno speak over the previous 20 years knows the statement was said without malice.
What was the point of including "At this moment the Board of Trustees should not spend a single minute discussing my status. They have far more important matters to address. I want to make this as easy for them as I possibly can."
Seriously - what was the point of that??? Those 3 sentences added NOTHING to his statement, beyond calling out the Board of Trustees.