Clippers stripped of five first-round picks, fined $30 million for Kawhi Leonard cap scandal in NBA bombshell
After a year-long investigation, the NBA ruled that the Clippers violated the league’s salary cap circumvention rules by “initiating off-court income opportunities” for star forward Kawhi Leonard.
And the punishments were harsh.
As a result of the investigation, the Clippers have been stripped of five first-round picks, the league issued a $30 million fine to owner Steve Ballmer and suspended Ballmer, President of Business Operations Gillian Zucker and President of Basketball Operations Lawrence Frank for various periods, the NBA announced on Wednesday.
Leonard will have to pay the league $700,000 while his uncle and former business representative, Dennis Robertson, is being banned by the NBA from all business dealings for five years.
“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,” NBA Commissioner Adam Silver said in a statement. “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.”
The NBA’s full announcement stated:
“The investigation found a pattern of misconduct and multiple significant rules violations by the Clippers organization, a prior offender of the salary cap circumvention rules. As described in a summary report prepared by Wachtell Lipton…the Clippers broke the rules by:
- Affirmatively initiating off-court income opportunities between Mr. Leonard and four companies doing business with the team: Aspiration Partners, Boingo Wireless, Daktronics, and Lockton Insurance;
- Facilitating endorsement agreements between these companies and Mr. Leonard;
- Inducing the companies to enter into these agreements by offering them business from the team;
- Paying personal expenses on behalf of Mr. Leonard and his representatives; and
- Failing to report improper solicitations for off-court income opportunities made on Mr. Leonard’s behalf through his then-business manager, Dennis Robertson.”
The announcement continued:
“Mr. Leonard, through the conduct of Mr. Robertson on his behalf, 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.
Based on this misconduct, the NBA has imposed the following penalties:
- The Clippers shall forfeit five first-round draft picks, one in each of the 2029, 2030, 2031, 2032, and 2033 NBA Drafts.
- The Clippers are fined $30 million.
- Clippers owner Steve Ballmer is suspended from all league and team activities for one year for knowingly seeking to help Mr. Leonard obtain off-court income opportunities, for approving a business deal that he knew was a precondition for Aspiration to enter into an endorsement agreement with Mr. Leonard, and for his failure to create conditions under which his organization abided by the NBA’s circumvention rules.
- Clippers President of Business Operations Gillian Zucker is suspended without pay for one year for being primarily and directly culpable for the impermissible endorsement arrangements and for providing false and misleading statements to investigators.
- Clippers President of Basketball Operations Lawrence Frank is suspended without pay for six months for his involvement with the impermissible endorsement arrangements and for approving impermissible expenses incurred by Mr. Leonard and his family.
- The Clippers organization and personnel are subject to a compliance and monitoring program overseen by the league office for a period of five years.
- In connection with his violations, Mr. Leonard is required to pay the league $700,000.
- Mr. Robertson is banned from conducting business or otherwise engaging with NBA teams and their affiliates on behalf of or with respect to any player, employee, or other league or team personnel for a period of five years.”
