However, there was no indication the Magic would let Donovan out of the five-year, $27.5 million dollar deal he agreed to last week, ESPN reported Sunday.
Magic executives were considering whether to let Donovan out of the contract, multiple sources told ESPN.com.
If the team lets Donovan out of the deal, it then must decide whether to enforce a financial penalty.
Neither side was talking publicly because there are legal issues involved in such a decision, ESPN said.
A final decision could come as early as Monday.
Donovan coached Florida to the NCAA tournament title each of the last two seasons. His deal with the Magic would make him one of the highest paid coaches in the NBA.
"The easy decision would have been for me to stay at Florida," Donovan said Friday. "Or I could take the next step and do something that would really challenge me as a person, as a coach, and help me grow, help me get better. I've always been intrigued by the NBA and the 24 hours of basketball."
Megyn Kelly: Santa Claus and Jesus are both white men
Wisconsin business offering 'therapeutic cuddling' forced to close