{"id":827269,"date":"2026-09-03T20:57:30","date_gmt":"2026-09-03T20:57:30","guid":{"rendered":"https:\/\/www.rawchili.com\/nba\/827269\/"},"modified":"2026-09-03T20:57:30","modified_gmt":"2026-09-03T20:57:30","slug":"la-clippers-ballmer-suing-the-nba-would-be-a-difficult-case-to-win","status":"publish","type":"post","link":"https:\/\/www.rawchili.com\/nba\/827269\/","title":{"rendered":"LA Clippers, Ballmer Suing the NBA Would Be a Difficult Case to Win"},"content":{"rendered":"

\n\tThe Los Angeles Clippers<\/a> vehemently refute the NBA\u2019s findings in the Kawhi Leonard<\/a> salary-cap circumvention investigation, but converting that opposition into legal action will be challenging. That\u2019s mainly because of the finality of league decisions and judicial deference to decisions of private associations.<\/p>\n

\n\tThe NBA on Wednesday concluded<\/a> that the Clippers and several team officials, including owner Steve Ballmer<\/a>, conspired to violate the salary cap by arranging for Leonard to receive extra compensation through endorsement deals for which the player did not have to perform services. Article XIII of the CBA prohibits salary-cap circumvention, meaning arrangements by teams to compensate players outside their employment contracts. Those arrangements undermine fair play and furnish teams with an unfair advantage over competitors.<\/p>\n

\n\tThe findings were based on a report<\/a> issued by Wachtell, Lipton, Rosen & Katz, which conducted 73 interviews with 60 people and reviewed more than 200,000 pages of documents obtained from individuals and organizations. Among other penalties, the NBA stripped the Clippers of five first-round picks, suspended Ballmer for a year and fined Leonard $700,000.<\/p>\n

\n\tOf legal importance, the NBPA agreed with the league\u2019s punishments, and Leonard signaled that he accepted responsibility for not carefully monitoring those around him. That eliminates the prospect of a grievance proceeding involving a neutral arbitrator, and it\u2019s an important distinction from the last time an NBA commissioner stripped a team of five first-round picks.<\/p>\n

\n\tMore than 25 years ago, the NBA imposed that punishment on the Minnesota Timberwolves for a cap-circumvention scheme in which they paid forward Joe Smith less on initial one-year contracts so they could sign other players, in exchange for promising to later sign Smith to a long-term, lucrative deal after acquiring his \u201cLarry Bird rights,\u201d which allowed the team to exceed the cap to retain a player.<\/p>\n

\n\tThe NBA also voided Smith\u2019s 1999\u20132000 contract with the Timberwolves and his previous Timberwolves contract from 1998\u201399. Smith and the NBPA then used arbitration<\/a> provisions in the collective bargaining agreement to challenge Stern. After reviewing the facts, an arbitrator upheld Stern\u2019s decision to void the contracts. With Leonard, the NBA imposed a penalty that was apparently acceptable to Leonard and the NBPA, and thus there won\u2019t be an arbitration challenge that extends the controversy.<\/p>\n

\n\tThe Clippers deny wrongdoing and \u201cvigorously challenge the findings.\u201d\u00a0<\/p>\n

\n\tDavid Kelly, an attorney for Ballmer, wrote a letter to NBA Commissioner Adam Silver<\/a> on Wednesday in which Kelly argued that the NBA\u2019s adverse findings and severe punishments don\u2019t match what league officials had indicated to Ballmer and the Clippers. Kelly went so far as to call the NBA\u2019s investigation a \u201cwitch hunt\u201d that failed to adhere to basic legal notions of fairness, such as notice and the opportunity to respond, warning that the Clippers \u201care exploring every legal remedy to address this gross injustice.\u201d<\/p>\n

\n\t\u201cLeague counsel,\u201d Kelly wrote, \u201chas acknowledged in our discussions that the league does not believe there was an agreement between the Clippers and Aspiration to funnel money to Kawhi Leonard.\u201d\u00a0<\/p>\n

\n\tKelly also maintained that NBA attorneys acknowledge Ballmer \u201cwas a victim\u201d of fraud inflicted by Joe Sanberg, the former co-CEO of Aspiration, who was recently sentenced to 14 years in prison for fraud.<\/p>\n

\n\tBallmer\u2019s attorney also insists that, while Silver has talked about ensuring a \u201cfundamental sense of fairness\u201d in the investigation, the Clippers were given less than an hour\u2019s warning \u201cand no opportunity to respond\u201d before the NBA released its findings on Wednesday.<\/p>\n

\n\tFurther, Kelly charges that the NBA changed its \u201ctheory\u201d of wrongdoing \u201cat the 11th hour\u201d to find it problematic that the Clippers introduced Leonard to team vendors and sponsors. The Clippers maintain that those introductions \u201care both proper and commonplace in the league,\u201d that no rule prohibits them and that the league has known about the introductions for years without acting.\u00a0<\/p>\n

\n\tAs Kelly sees it, the NBA has failed to adhere to basic notions of \u201cdue process,\u201d which require procedural fairness and notice that a particular action is considered wrong and can trigger a punishment, and is \u201cretroactively punishing the Clippers for violating a rule that never existed.\u201d<\/p>\n

\t\tForecasting a lawsuit\t<\/p>\n

\n\tKelly\u2019s letter suggests that the Clippers are contemplating a lawsuit. The Clippers could draw from the legal playbook of former owner Donald Sterling, on whom Silver imposed a lifetime ban and who, through a legal battle with his wife, Shelly Sterling, lost control of the trust that owned the team. The Clippers could sue the league for violating antitrust law, contract law and fiduciary duties, and accuse the league of misrepresentation and interference. The team could seek an injunction to block the NBA from imposing its penalties on the Clippers, Ballmer and team officials.<\/p>\n

\n\tThe basic argument would be that the NBA and its teams have conspired in anticompetitive ways to degrade the Clippers, with accompanying harm suffered by consumers\u2014the Clippers\u2019 fans. The Clippers will be \u201cless competitive\u201d without five first-round picks. The\u00a0\u00a0franchise could argue that team introductions are common and that the Clippers are being punished for conduct in which rival teams engage.<\/p>\n

\n\tAnother potential Clippers legal claim could concern what they depict as the NBA\u2019s \u201cwitch hunt.\u201d The team can\u2019t credibly raise a due-process claim tied to the U.S. Constitution or California Constitution, because the NBA is a private body and thus isn\u2019t a state actor, meaning a government entity that must adhere to due-process protections.\u00a0<\/p>\n

\n\tBut the Clippers could still tie due process to a contractual theory\u2014namely, that while the NBA commissioner has extensive discretion under the league constitution and bylaws, the commissioner still must act fairly, including by providing fair notice and opportunities to respond.<\/p>\n

\n\tOther possible claims might include breach of fiduciary duty, breach of the duty of loyalty, fraud, misrepresentation and intentional interference with prospective economic advantage. The gist of these claims would be that the NBA and Silver are obligated to act fairly and reasonably, and that their alleged failure to do so has harmed the Clippers\u2019 business interests, relationships with players and sponsorship dealings.<\/p>\n

\n\tTo the extent that the Clippers have other specific examples of team introductions that resemble the Leonard introductions, their argument becomes stronger. As\u00a0Sportico\u00a0has detailed<\/a>, there are examples of players in the NBA and other leagues signing endorsements with companies that also sponsor those players\u2019 teams.\u00a0<\/p>\n

\n\tSome examples include online shopping platform Rakuten having a sponsorship with the Golden State Warriors and an endorsement deal with Warriors star Steph Curry; Samuel Adams partnering with both the Boston Red Sox and then-third baseman Alex Bregman on the release of Bregman\u2019s Beer; and Nike signing Neymar to an endorsement deal while also sponsoring Brazil\u2019s national soccer team.<\/p>\n

\n\tThe Clippers can also attack the reliability of the findings. Wachtell acknowledges that its investigators interviewed Joe Sanberg, co-founder of former Clippers sponsor Aspiration and who, in June, was sentenced<\/a> to 14 years in prison for fraud. Sanberg orchestrated a scheme to defraud lenders and investors, including Ballmer, of more than $248 million between 2020 and 2025.\u00a0It\u2019s fair to question Sanberg\u2019s veracity and the accuracy of any materials he shared with the NBA.<\/p>\n

\n\tIn April, Kelly objected to Wachtell attorney David Anders, a former federal prosecutor who leads the NBA\u2019s investigation, writing a letter to the judge who was set to sentence Sanberg. Anders said that he and other investigators sought Sanberg\u2019s cooperation to further the investigation. Anders reflected that Sanberg provided \u201cadditional information that was relevant to our investigation\u201d and helped the investigators \u201cdevelop a more complete understanding of key events.\u201d Kelly suggested that Sanberg agreed to provide the NBA with information \u201cin return for a sentencing letter that the league submitted on his behalf.\u201d<\/p>\n

\t\tGame-planning NBA legal defenses\t<\/p>\n

\n\tThe NBA would be armed with several defenses to block a Clippers lawsuit and secure its dismissal long before there would be any pretrial discovery requiring each side to provide testimony and share evidence.<\/p>\n

\n\tFirst, the NBA would cite case law standing for the legal principle that a court should abstain, which refers to judges declining to hear a case when there is another proceeding. Here, the NBA would argue that no court should interfere with the internal disputes of a private membership association. Indeed, courts usually provide broad deference to private associations and intervene only when they act arbitrarily or capriciously.<\/p>\n

\n\tThe NBA would assert that the Clippers were given ample opportunities to make their case, including the chance to offer specific examples of other teams engaging in similar conduct, and apparently failed to do so. The NBA would also argue that it followed applicable procedures in the league constitution and thus satisfied its contractual process obligations.<\/p>\n

\n\tSecond, the NBA would stress the league constitution, which is a contract among the league, teams and owners and specifies their respective duties and rights. The constitution is not the collective bargaining agreement, which governs the relationship among players, teams and the league. It is a separate source of contractual rights and obligations. By owning an NBA team, owners agree to the constitution, which expressly states that all decisions of the commissioner are \u201cfinal and binding\u201d and should understood as arbitration awards.<\/p>\n

\n\tThird, the NBA would insist that there is no viable antitrust claim, as there is no injury to competition. The league could maintain that enforcement of its rules furthers, rather than hinders, competition, because it communicates to fans\u2014consumers\u2014that the games reflect fair play and genuine competition, and that teams attempting to circumvent fair-play rules are held accountable.<\/p>\n

\n\tFourth, the league would maintain that there is no conspiracy against the Clippers. The Wachtell report doesn\u2019t merely argue there were introductions to otherwise organic endorsement opportunities; it says the introductions were ruses to facilitate payments directed by the Clippers.\u00a0<\/p>\n

\n\tFor instance, it says that in June 2020, team president of business operations Gillian Zucker wrote what were called \u201cintroduction\u201d emails between the team and potential companies that might sign Leonard to endorsements but, Wachtell argues, were in reality \u201cin an apparent effort to create the appearance of complying with the circumvention rules.\u201d<\/p>\n

\n\tTo that point, Wachtell says Zucker claimed she was emailing in response to requests by those companies to get in touch with Leonard. Wachtell concluded that there was no evidence the companies actually requested introductions and found it suspicious that each of these emails was sent within six days of the others, \u201cin the midst of the COVID-19 pandemic and while the NBA season was suspended.\u201d<\/p>\n

\n\tOther defenses might include the argument that there is no relevant fiduciary duty owed by the NBA or Silver to the Clippers or Ballmer, and that claims like intentional interference require an underlying wrongful act, which the NBA would maintain never happened.<\/p>\n

\t\tHow the Clippers can reduce penalties\u2014and stigma\t<\/p>\n

\n\tBallmer has billions of dollars to spend on attorneys, should he try the litigation route, but as detailed above, he\u2019d probably lose.\u00a0<\/p>\n

\n\tConsider what that means. Not only would a court rule against him, but the scandal would play out in court over months or years, casting a cloud over the franchise and possibly making Ballmer persona non grata with the NBA and fellow owners.<\/p>\n

\n\tBallmer might instead consider the approach used by the New England Patriots and owner Robert Kraft in the aftermath of a damning report by a law firm, the Wells Report, accusing the team of cheating through a purported conspiracy to slightly underinflate footballs\u2014Deflategate.\u00a0<\/p>\n

\n\tMany urged the Patriots to sue, and there was significant scientific evidence that the NFL\u2019s assertions were uncorroborated, if not outright implausible.\u00a0<\/p>\n

\n\tBut Kraft didn\u2019t sue, knowing that the case would have gone nowhere. As in the NBA, punishments by the commissioner are final and conclusive. Instead, he and the Patriots relied on lawyers, scientists and commentators to refute the claims. The team released\u00a0The Wells Report in Context, a document that didn\u2019t help in court but likely did shift public opinion and left serious questions about whether the NFL was right.\u00a0<\/p>\n

\n\tThe Clippers could offer a similar document that tries to poke holes in the NBA\u2019s assertions. The team might argue that some of the materials are not reliable, because they are not based on sworn testimony, and thus individuals making assertions wouldn\u2019t risk perjury charges if they knowingly lied.\u00a0<\/p>\n

\n\tThe Clippers might also maintain that executives of other companies involved, including sponsors that do business with other NBA teams and the league in addition to the Clippers, might have deflected blame onto the Clippers to protect their own business interests. Further, the Clippers might contend that additional texts, emails and comments provide important context not reflected in Wachtell\u2019s report.<\/p>\n

\n\tNone of those arguments might help in court, but they could help the Clippers and Ballmer defend their reputations and legacies.<\/p>\n

\n\tBallmer could also attempt to negotiate a reduced draft-pick penalty, perhaps by agreeing to a longer separation from the team. The NBA reduced the Timberwolves\u2019 draft penalty, first from five picks to four and then from four to three, after team executive Kevin McHale and owner Glen Taylor agreed to serve suspensions. Obviously, any Ballmer suit against the NBA and Silver probably wouldn\u2019t help the team\u2019s effort to reduce the punishment.<\/p>\n","protected":false},"excerpt":{"rendered":"The Los Angeles Clippers vehemently refute the NBA\u2019s findings in the Kawhi Leonard salary-cap circumvention investigation, but converting…\n","protected":false},"author":2,"featured_media":827270,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[2214,52751,7,32160,529,135,6,3677],"class_list":["post-827269","post","type-post","status-publish","format-standard","has-post-thumbnail","category-nba","tag-adam-silver","tag-arbitration","tag-basketball","tag-federal-courts","tag-kawhi-leonard","tag-los-angeles-clippers","tag-nba","tag-steve-ballmer"],"share_on_mastodon":{"url":"https:\/\/channels.im\/@nba\/117209113870593893","error":""},"_links":{"self":[{"href":"https:\/\/www.rawchili.com\/nba\/wp-json\/wp\/v2\/posts\/827269","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.rawchili.com\/nba\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.rawchili.com\/nba\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.rawchili.com\/nba\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.rawchili.com\/nba\/wp-json\/wp\/v2\/comments?post=827269"}],"version-history":[{"count":0,"href":"https:\/\/www.rawchili.com\/nba\/wp-json\/wp\/v2\/posts\/827269\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.rawchili.com\/nba\/wp-json\/wp\/v2\/media\/827270"}],"wp:attachment":[{"href":"https:\/\/www.rawchili.com\/nba\/wp-json\/wp\/v2\/media?parent=827269"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.rawchili.com\/nba\/wp-json\/wp\/v2\/categories?post=827269"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.rawchili.com\/nba\/wp-json\/wp\/v2\/tags?post=827269"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}