Clippers owner Steve Ballmer denies allegations that the team circumvented the NBA’s salary cap rules when signing Kawhi Leonard in 2021.
The NBA is investigating claims that the Clippers facilitated a no-show endorsement deal for Leonard with Aspiration, a company in which Ballmer had invested.
If found to have violated the league’s Collective Bargaining Agreement, the Clippers could face significant penalties.
Ballmer is adamant his organization went about its business according to league rules.
‘We did things by the book,’ Ballmer declared in an interview with ESPN that aired on Thursday, Sept. 5, which also served as his first public comments on the matter.
The NBA is investigating allegations made by sports reporter Pablo Torre of ‘Pablo Torre Finds Out’ that the Clippers facilitated a no-show endorsement deal for Leonard worth at least $28 million with Aspiration, a now-bankrupt ‘green’ financial services company that was a prominent team sponsor at the time. Aspiration also received a $50 million investment from Ballmer.
If the NBA finds the Clippers to have violated the salary cap circumvention provisions in the league’s Collective Bargaining Agreement, the penalties could be significant based on current bylaws and previous incidents of salary cap circumvention.
The Clippers called the allegations ‘provably false’ and ‘absurd’ in team-issued statements Wednesday after the initial report. Ballmer went into more detail Thursday about the circumstances behind Leonard’s signing, and how the Clippers abided by NBA rules and protocols when dealing with Leonard and his representatives.
The former Microsoft CEO noted, for instance, that Leonard’s four-year, $176.2-million contract with the Clippers was finalized in August 2021 and the franchise’s lucrative sponsorship deal with Aspiration came together in September. Aspiration then approached the Clippers for an introduction to Leonard in ‘early November,’ according to Ballmer.
Among the documents uncovered by Torre was Leonard’s contract with Aspiration, which included a clause that states KL2 Aspire LLC, a company run by Leonard, could ‘decline to proceed with any action desired by the Company,’ which set up a structure for Leonard to potentially receive payments without performing any work. Another clause states that Leonard would receive payments only if he continued to be a player on the Clippers.
‘They did request to be introduced to Kawhi,’ said Ballmer, who added neither he nor the Clippers had control over Aspiration’s business dealings despite their investment. ‘Under the (NBA) rules, we can introduce our sponsors to our athletes. We just can’t be involved. We made an introduction. That was in early November, well past when all of this happens.’
Ballmer said he was instead ‘conned’ by Aspiration, and emphasized he did not know the financial terms agreed to between Leonard and Aspiration. The Justice Department announced in August that Aspiration co-founder Joe Sanberg plead guilty to two counts of wire fraud for defrauding investors and lenders of more than $248 million.
The Clippers had gone through documents and emails related to Aspiration and Leonard in recent months as part of the the Justice Department and Securities and Exchange Commission investigations into the company, according to Ballmer. He said the Clippers ‘welcome the league investigation. We have nothing to hide.’
The Clippers have already been found to have engaged in impropriety with third-party endorsements under Ballmer. Back in August 2015 – a year after Ballmer’s purchase of the team was finalized – the NBA fined the franchise $250,000 for ‘violating NBA rules prohibiting teams from offering players unauthorized business or investment opportunities’ in their pursuit of then-free agent center DeAndre Jordan.
‘It’s really important to me to communicate to the NBA ecosystem, but particularly Clipper fans, that we’ve been on the up and up,’ Ballmer said. ‘Since the day I bought the team, and you know the circumstances were definitely tough, we’ve emphasized doing things the right way. … I want our fans to really understand that they’ve aligned themselves, they’ve supported an organization that does things the right way.’
USA TODAY Sports reporter Lorenzo Reyes contributed to this report.