Reports indicate that the LA Clippers and owner Steve Ballmer are facing accusations of evading the NBA`s salary cap through a $28 million payment to Kawhi Leonard for a “no-show” position.
Podcaster and former ESPN contributor Pablo Torre revealed on Wednesday that the Clippers allegedly compensated Leonard via a company that was once owned by Ballmer and has since declared bankruptcy.
During a recent episode of his podcast, “Pablo Torre Finds Out,” Torre referenced numerous internal documents from Aspiration, a tree-planting company. Ballmer had partially funded Aspiration with a $50 million investment through his personal LLC on September 14, 2021.
On September 27, 2021, later that same month, the Clippers revealed a $300 million partnership with Aspiration, which is now bankrupt. This deal encompassed sponsorship for the team`s new arena and its jersey patch.
Torre claims that in April 2022, Leonard, through his LLC KL2 Aspire, entered into a four-year, $28 million endorsement agreement. This endorsement deal was finalized nine months after Leonard had signed a four-year, $176.3 million contract to stay with the Clippers, which was the maximum allowable under the NBA`s collective bargaining agreement at that time.
According to Torre, a clause in one of the allegedly obtained documents stipulated that the agreement between Aspiration and KL2 Aspire would be terminated if Leonard were to leave the Clippers. Furthermore, Leonard had the option to “decline to proceed with any action desired” by Aspiration while still receiving payments.
An anonymous former Aspiration employee reportedly informed Torre that the payment to Leonard was intended “to circumvent the salary cap.”
Official Response and NBA Regulations
In response, the Clippers stated, “Neither Mr. Ballmer nor the Clippers bypassed the salary cap or engaged in any wrongdoing concerning Aspiration. Any claims to the contrary are verifiably false: The team concluded its partnership with Aspiration years ago, during the 2022-23 season, after Aspiration failed to meet its obligations. Neither the Clippers nor Mr. Ballmer were privy to any improper activities by Aspiration or its co-founder until after the government initiated its inquiry. Both the team and Mr. Ballmer are prepared to cooperate fully with law enforcement.”
The NBA did not immediately provide a comment when approached regarding Torre`s allegations.
Under the NBA`s 2023 collective bargaining agreement, teams found to have circumvented the salary cap face severe penalties. These include fines up to $7.5 million, the forfeiture of draft picks, the nullification of player contracts, and suspensions of up to one year for any team personnel involved in such infractions.
Past Precedents and Clippers` Previous Fines
A precedent for such violations occurred in 2000 when the Minnesota Timberwolves were found to have made an illegal secret agreement with Joe Smith. They allegedly promised him a future multi-million dollar contract if he would sign a shorter, less lucrative deal with the team initially.
The NBA`s response was to penalize the Timberwolves by stripping them of five first-round draft picks, imposing a $3.5 million fine, suspending head coach Kevin McHale and owner Glen Taylor for a season, and voiding Smith`s contracts.
The Clippers have faced prior penalties; in May 2019, the NBA fined them $50,000 for tampering. This occurred after then-head coach Doc Rivers publicly compared Leonard, then a player for the Toronto Raptors, to Michael Jordan.
The NBA also investigated the Clippers following claims that Leonard and his representatives, led by his uncle Dennis Robertson, made inappropriate demands to teams during his 2019 free agency. Reports at the time indicated these demands included partial team ownership, access to a private jet, a residence, and guaranteed off-court endorsement earnings.
In November 2019, the NBA issued another $50,000 fine to the Clippers due to comments made by Rivers that were deemed “inconsistent” with Leonard`s health status.
A December 2020 lawsuit filed by Johnny Wilkes also prompted an NBA investigation into the Clippers` free-agent acquisition of Leonard. Wilkes claimed he facilitated Leonard`s move to the Clippers in return for a $2.5 million payment from team consultant Jerry West. The Clippers refuted these claims, and the lawsuit was subsequently dismissed without any league penalties.
Kawhi Leonard`s Current Status and Team Lawsuits
Leonard, now 34, most recently signed a three-year, $153 million extension in January 2024, securing his contract with the Clippers through the 2026-27 season.
Additionally, the Clippers are currently involved in a 2024 civil lawsuit brought by former strength and conditioning coach Randy Shelton. Shelton is suing the team and President of Basketball Operations Lawrence Frank, alleging wrongful termination partly due to his voiced concerns regarding the handling of Leonard`s health and injuries.
