The Los Angeles Clippers have been fined $30m and star player Kawhi Leonard has been hit with a $700,000 penalty for violating salary cap circumvention rules.
The NBA came down hard on the organisation after a nearly year-long investigation with several additonal punishments given out, including:
- Owner Steve Ballmer suspended for one year
- President of basketball operations Lawrence Frank suspended without pay for six months
- President of business operations Gillian Zucker suspended for one year
- Clippers were also stripped of five first-round draft picks
The Clippers had said multiple times that they had done nothing wrong and expected to be exonerated.
“I accept full responsibility for lapses in judgment by people within my inner circle and regret the distraction this situation has caused the fans and my family,” Leonard said in a statement issued through his new agent, Harrison Gaines.
Why historic punishment was reached
The NBA said Leonard, through his former business manager and uncle 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.”
Leonard added: “I entered into my contract with the Clippers as well as the agreements in question in good faith, fully committed to fulfilling my obligations and with no knowledge of any intent on anyone’s part to circumvent the salary cap.”
The league said Ballmer was suspended for “knowingly seeking to help Mr Leonard obtain off-court income opportunities,” among other issues.
An investigation conducted by New York law firm Wachtell Lipton said the Clippers broke NBA rules by initiating off-court income opportunities between Leonard and four companies doing business with the team, as well as facilitating endorsement agreements between Leonard and the companies.
It added the Clippers “induced the companies to enter into these agreements by offering them business from the team”, as well as paying personal expenses on behalf of Leonard and “failing to report improper solicitations for off-court income opportunities” made on Leonard’s behalf through his then-business manager Dennis Robertson.
Leonard was fined $700,000 for his role in the scandal
NBA Commissioner Adam Silver said: “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. 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.”
Leonard, a two-time NBA champion and two-time Defensive Player of the Year, was subject to a trade agreement earlier this summer that was set to see him return to the Toronto Raptors. The deal was subsequently put on hold until the end of the NBA’s investigation.
Who are the individuals involved in the scandal?
The report by Watchell, Lipton, Rosen and Katz identified Clippers owner Steve Ballmer, Clippers president of business operations Gillian Zucker and president of basketball operations Lawrence Frank as the three individuals most responsible for the Clippers’ rule-breaking.
It detailed how Ballmer “knowingly sought to help Mr Leonard obtain off-court income opportunities” and how Zucker served as the point person on all four deals between the companies and the Clippers.
Frank, the primary team contact for Leonard’s uncle and business manager Robertson, was found responsible for approving payments made by the Clippers for impermissible expenses incurred by Mr Leonard and his family.
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