Facing a mountain of evidence, the NBA had to bring the hammer down hard on Clippers owner Steve Ballmer and the Clippers in the salary cap circumvention case involving Kawhi Leonard and former team sponsor Aspiration, among others. If not, 29 other team owners would have gotten the message that the price for circumventing the salary cap was worth it.
Adam Silver has thrown the book at Ballmer and the Clippers with the harshest penalties in league history. The NBA released its findings and penalties, and it hits the Clippers hard:
• The Clippers forfeit five first-round draft picks (2029, 2030, 2031, 2032, and 2033; Note the 2029 pick was one the Clippers got from Indiana in the Ivica Zubac trade, it does not revert to the Pacers, it is just voided).
• The Clippers are fined $30 million.
• Owner Steve Ballmer is suspended from “all league and team activities for one year for knowingly seeking to help Mr. Leonard obtain off-court income opportunities, for approving a business deal that he knew was a precondition for Aspiration to enter into an endorsement agreement with Mr. Leonard, and for his failure to create conditions under which his organization abided by the NBA’s circumvention rules.”
• Clippers President of Business Operations Gillian Zucker is suspended for one year without pay.
• Clippers President of Basketball Operations Lawrence Frank is suspended without pay for six months.
• Kawhi Leonard must pay the league $700,000.
• Leonard’s already-fired business manager, Dennis Robertson (better known as “Uncle Dennis”), is banned from conducting NBA business for five years.
Ballmer and the Clippers plan to fight this, as they said in a statement:
“We vehemently reject the NBA’s findings, which are the result of a heavily biased investigation seeking to justify a predetermined narrative rather than facts and evidence. What the league told us privately differs from what it announced today publicly, and they have not held themselves close to the standard Commissioner Silver set at the start of this investigation to ensure it’s fairness and accuracy.
“For the past year, we cooperated fully and in good faith and we will now fight just as hard to demonstrate our innocence.
“We intend to vigorously challenge these findings and penalties through every avenue available to us and look forward to an ethical and impartial arbitration process.”
The Clippers’ attorney also sent a lengthy, scathing letter to Silver saying the “process was designed to substantiate a predetermined outcome.”
While the Clippers, Ballmer and the NBA had been talking, the sides were nowhere close to agreeing on a punishment, a league source told NBC Sports. The Clippers said they were blindsided by this announcement.
Ballmer can — and almost certainly will — take this issue to court, but there will be no arbitration through the CBA.
Both the NBA and NBPA have agreed on the details and punishments involving Leonard, which means there is no arbitration case coming — that is only for the players, not the franchise, and the players’ union signed off on this. Leonard is accepting the punishment — a $700,000 fine for endorsement deals that brought him more than $30 million — and released this statement on Instagram.
“Integrity and respect for this game are fundamental to who I am. I accept full responsibility for lapses in judgment by people within my inner circle and regret the distraction this situation has caused the fans and my family.
“I entered into my contract with the Clippers as well as the agreements in question in good faith, fully committed to fulfilling my obligations and with no knowledge of any intent on anyone’s part to circumvent the salary cap.
“For 15 years, my priority has been giving everything to my family, the game, and those I share the court with. As I return to Toronto, I am focused on what I can control, closing this chapter, and moving forward with a clean slate.”
Leonard does not face a suspension or voiding of his contract, only the fine. That means the trade that would send him to Toronto for Brandon Ingram and Gradey Dick likely goes through in the coming weeks.
“The NBA’s collectively bargained system for determining player compensation is a fundamental component of the basketball competition that the league oversees for the benefit of the teams and players and ultimately the fans,” NBA Commissioner Adam Silver said in a statement. “I am deeply disappointed by the flagrant violations of our rules and by the Clippers’ institutional and leadership failures that led to this misconduct. The severity of the penalties reflects the seriousness of the violations.”
The report, compiled by the law firm of Wachtell Lipton, found that “uncle Dennis” pressured the Clippers, on Leonard’s behalf, “to assist him in obtaining off-court income opportunities, successfully obtaining those opportunities, and failing to reimburse payments by the Clippers for personal expenses.” Formally, the report found that the Clippers:
• Initiated and helped facilitate endorsements and off-court income opportunities between Mr. Leonard and four companies doing business with the team: Aspiration Partners, Boingo Wireless, Daktronics, and Lockton Insurance.
• The Clippers induced “the companies to enter into these agreements by offering them business from the team.”
• The Clippers paid “personal expenses on behalf of Leonard and his representatives” and failed “to report improper solicitations for off-court income opportunities made on Mr. Leonard’s behalf through his then-business manager, Dennis Robertson.”
What led to this finding
It was essentially an open secret around the NBA dating back to 2019 — when Leonard was a free agent, ultimately signing with the Clippers — that Uncle Dennis was asking for all kinds of things to circumvent the salary cap. Other teams shot him down, and the Clippers were investigated by the league at the time, but no evidence was found.
That started to change post-pandemic with Aspiration, a former Clippers sponsor and green bank company that has since gone bankrupt. The story was driven by reporting on the Pablo Torre Finds Out podcast. Clippers owner Ballmer made a $50 million investment in Aspiration not long before Leonard signed a $28 million endorsement deal with the company. Ballmer and other Clippers executives made other investments in the company over the years, even as there were signs the business was failing. Several former Aspiration employees told Torre Leonard signed a “no-show” endorsement designed to funnel more money to Leonard and circumvent the NBA salary cap without him having to do work. There is no evidence Leonard did any promotional work for the company.
Eventually, Aspiration’s house of cards collapsed and its founder, Joe Sanberg, was convicted of defrauding investors and sentenced to 14 months in prison. The Clippers argued that Ballmer and the franchise were duped like other investors and had done nothing wrong.
It wasn’t just Aspiration. Pablo Torre Finds Out later reported that Leonard had an endorsement deal with Daktronics, the makers of the Halo board inside the Inuit Dome. This was odd because Daktronics does not do consumer-facing advertising and had never had a celebrity endorser previously. As noted above, both Boingo Wireless and Lockton Insurance also appeared to have no-show endorsement deals with Leonard.
The Clippers have maintained their innocence throughout this process. That said, a mountain of oddly timed, circumstantial evidence — plus comments from employees at Aspiration — points to questionable endorsement deals.
