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The NBA hit the Los Angeles Clippers with crippling sanctions for violating salary cap circumvention rules when they signed Kawhi Leonard in 2022, including a $30 million fine and the forfeiture of five first-round draft picks.
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The league issued a statement Wednesday saying its near-yearlong investigation “found a pattern of misconduct and multiple significant rules violations by the Clippers organization, a prior offender of the salary cap circumvention rules.”
The league also determined that Leonard, through the conduct of his then-business manager Dennis Robertson, 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.
In a ruling that could affect the Western Conference for years to come, the NBA 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 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 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 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.
- 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, Leonard is required to pay the league $700,000.
- 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 announcement came three months after Aspiration co-founder Joseph Sanberg was sentenced to 14 years in prison. In October, Sanberg pleaded guilty to federal charges of conspiring to bilk investors out of $248 million for portraying the now-defunct Aspiration as a “socially-conscious and sustainable banking services and investment products” firm.
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The NBA investigation focused on $60 million invested in Aspiration by Ballmer and the $28-million contract Leonard signed with Aspiration for endorsement and marketing work that he never delivered.
Players are permitted to have endorsement and business deals outside of their contracts, but the Clippers allegedly facilitated a side deal beyond simply introducing Aspiration executives to Leonard, violating Article 13 of the NBA collective bargaining agreement.
“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 issued by the league office. “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 Clippers issued a statement pushing back on the league’s decision.
“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,” the team said in a statement. “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.”
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