After a year-long investigation, the NBA ruled that the Clippers violated the league’s salary cap circumvention rules by initiating off-court sponsorship deals for star forward Kawhi Leonard, the NBA announced today.
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The franchise has been stripped of five first-round picks, the league issued a $30 million fine to owner Steve Ballmer and suspended Ballmer, President of Business Operations Gillian Zucker and President of Basketball Operations Lawrence Frank for various periods.
Leonard will have to pay the league $700,000 while his uncle and former business representative, Dennis Robertson is being banned by the NBA from all business dealings.
The NBA’s announcement stated:
“The investigation found a pattern of misconduct and multiple significant rules violations by the Clippers organization, a prior offender of the salary cap circumvention rules. As described in a summary report prepared by Wachtell Lipton…the Clippers broke the rules by:
– Affirmatively initiating off-court income opportunities between Mr. Leonard and four companies doing business with the team: Aspiration Partners, Boingo Wireless, Daktronics, and Lockton Insurance;
– Facilitating endorsement agreements between these companies and Mr. Leonard;
– Inducing the companies to enter into these agreements by offering them business from the team;
– Paying personal expenses on behalf of Mr. Leonard and his representatives; and
– Failing to report improper solicitations for off-court income opportunities made on Mr. Leonard’s behalf through his then-business manager, Dennis Robertson.”
The announcement continued:
“Mr. Leonard, through the conduct of Mr. Robertson on his behalf, violated the circumvention rules by pressuring the Clippers to assist him in obtaining off-court income opportunities, successfully obtaining those opportunities, and failing to reimburse payments by the Clippers for personal expenses.
Based on this misconduct, the NBA has imposed the following penalties:
– The Clippers shall forfeit five first-round draft picks, one in each of the 2029, 2030, 2031, 2032, and 2033 NBA Drafts.
– The Clippers are fined $30 million.
– Clippers 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 without pay for one year for being primarily and directly culpable for the impermissible endorsement arrangements and for providing false and misleading statements to investigators.
– Clippers President of Basketball Operations Lawrence Frank is suspended without pay for six months for his involvement with the impermissible endorsement arrangements and for approving impermissible expenses incurred by Mr. Leonard and his family.
– The Clippers organization and personnel are subject to a compliance and monitoring program overseen by the league office for a period of five years.
– In connection with his violations, Mr. Leonard is required to pay the league $700,000.
– Mr. Robertson is banned from conducting business or otherwise engaging with NBA teams and their affiliates on behalf of or with respect to any player, employee, or other league or team personnel for a period of five years.”
The Clippers agreed to trade Leonard to Toronto in July but the Raptors said they would await the result of the investigation before finalising the deal.
Leonard and the Clippers both responded with statements, striking far different tones.
“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,” Leonard said in a statement via his agent.
“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.“
The Clippers said: “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.”
– This article originally appeared on the New York Post and was republished with permission