After a yearlong investigation into the Los Angeles Clippers, their owner Steve Ballmer, star forward Kawhi Leonard and various business partners, the NBA handed out the most severe punishment we have seen in league history on Sept. 2. The league found that the Clippers funneled millions of dollars in off-court endorsement money to Leonard to circumvent the salary cap, allowing them to allocate more money for other needs. How exactly did the Clippers do this, and what does this mean for their future?
The Scandal
There have been reports for years that Leonard’s uncle and business advisor, Dennis Robertson, sought extra benefits and endorsements from teams seeking to acquire Leonard in free agency of the 2019 season. After a short investigation, the NBA deemed there was no clear evidence, but they would keep the case open.
Journalist Pablo Torre then reported a year ago that Aspiration, a tree planting service that counted Ballmer as one of its principal investors, had signed Leonard to a lucrative sponsorship deal in which he reportedly performed no work. Aspiration is now bankrupt, after subsequent investigations showed a secret $28 million endorsement deal that served as a “no-show” arrangement. The deal was intended to circumvent the NBA’s salary cap while giving Leonard no official duties. This june, Aspiration’s cofounder Joe Sandberg was sentenced to 14 years in federal prison for running this fraud scheme against investors and lenders.
It was also found that some Aspiration officials initially did not want to “hire” Leonard, but were assured that they would be receiving additional investment from Ballmer and the Clippers. According to the NBA’s report, the Clippers also helped arrange similar deals with three other companies: Boingo Wireless, Daktronics and Lockton Insurance. In addition, the Clippers were found to have covered business expenses for Leonard that he should have covered himself.
The Punishment
The NBA stripped the Clippers of five first-round draft picks. Ballmer was fined $30 million and was suspended from all team and league activities for one year. Clippers executives Lawrence Frank and Gillian Zucker were suspended without pay, for six months and one year, respectively. The league also banned Robertson from conducting NBA business for five years. Leonard himself was fined $700,000.
While these fines may seem unfathomable to us Vassar students, $30 million is unfortunately pocket change for Steve Ballmer, who is currently ranked 15th on the Forbes billionaires list. Ballmer, a former Microsoft CEO, is worth $152.4 billion dollars, so his lifestyle will not be seriously affected. Leonard also makes $44 million yearly, so his fine is about a week of his salary.
The kicker is the actual punishment to the Clippers franchise. Five first-round draft picks is already an extreme haul, which is usually only ever in the news for blockbuster trades involving superstars. However, this is even worse for a team like the Clippers, given their recent trades of multiple draft picks. After the Toronto Raptors won the 2019 NBA Championship, Finals MVP Leonard decided to sign with the LA Clippers on one condition: that they traded for MVP candidate Paul George. To secure two of the biggest stars in the league at the time, the Clippers sent an absolutely enormous package to the Oklahoma City Thunder, including five first round draft picks, two pick swaps, Shai Gilgeous-Alexander—who is now a two-time MVP, scoring champion, NBA champion and finals MVP—and Danilo Gallinari.
In the summer of 2019, the Clippers were hailed as LA’s number one team after decades of being in the Lakers’ shadow, and Leonard as the new “King of LA” after LeBron James signed with the Lakers the year prior. Since then, the Thunder have won a championship, the Los Angeles Lakers have won a championship and the Clippers have yet to even appear in the NBA Finals. Leonard has now cost the Clippers 10 first round picks, and has nothing to show for it. The Kawhi Leonard Clippers era will undoubtedly go down as one of the biggest fails in NBA history.