The NBA is opening an investigation into a media report that Los Angeles Clippers star Kawhi Leonard received a multimillion-dollar no-work contract with a now-bankrupt environmental company as a form of payment to circumvent the NBA’s salary rules.
“We are aware of this morning’s media report regarding the LA Clippers and are commencing an investigation,” NBA spokesman Mike Bass told The Athletic on Wednesday.
The investigation comes after a report on Wednesday by the podcast “Pablo Torre Finds Out” about allegations made by former employees of the environmental company, Aspiration, which Clippers owner Steve Ballmer partly funded. According to documents provided to Torre, the employees alleged that the company arranged large payments to Leonard under the condition that he play for the Clippers.
NBA teams are prohibited from paying players using outside arrangements.
In a statement acquired by The Athletic, the Clippers and Balmer denied any wrongdoing: “Neither the Clippers nor Steve Ballmer circumvented the salary cap. The notion that Steve invested in Aspiration to funnel money to Kawhi Leonard is absurd. Steve invested because Aspiration’s co-founders presented themselves as committed to doing right by their customers while protecting the environment.
“After a long campaign of market manipulation, which defrauded not only Steve but numerous other investors and sports teams, Aspiration filed for bankruptcy. Its co-founder, Joseph Sanberg, recently pleaded guilty to a $243 million fraud. Neither Steve nor the Clippers had knowledge of any improper activity by Aspiration or its co-founder until after the government initiated its investigation. Aspiration was a team sponsor for the 2021-2022 and 2022 2023 seasons before defaulting on its contract.
“There is nothing unusual or untoward about team sponsors doing endorsement deals with players on the same team. Neither Steve nor the Clippers organization had any oversight of Kawhi’s independent endorsement agreement with Aspiration. To say otherwise is flat-out wrong.
“The Clippers take NBA compliance extremely seriously, fully respect the league’s rules, and welcome its investigation related to Aspiration. The Clippers will also continue to cooperate with law enforcement in its investigation into Aspiration’s blatantly fraudulent activity.”
Messages left for Leonard’s business partners about the allegations were not immediately returned.
Torre reported on his podcast on Wednesday that seven anonymous former employees of Aspiration told him that Leonard received a four-year, $28 million endorsement deal in 2022. Torre said he could not find any evidence of Leonard promoting the company in social media posts, photographs or appearances. The Athletic found one social media post from the Clippers tagging both Aspiration and Leonard, who did not like or retweet the post.
Happy Birthday, Kawhi! 🎉
For every comment/retweet, @Aspiration will plant one tree for Kawhi’s birthday! pic.twitter.com/8zvZpj1xic
— LA Clippers (@LAClippers) June 29, 2022
Aspiration filed for bankruptcy in March after its co-founder, Sanberg, was arrested on charges of wire fraud. In August, Sanberg pleaded guilty to defrauding investors.
Publicly available bankruptcy filings reviewed by The Athletic show that KL2 Aspire, a company listed as having Leonard as its manager, claims it is owed $7 million. Aspiration’s largest creditor is the Clippers, who claim they are owed $30 million.
The NBA initially investigated the Clippers when Leonard signed with the team during his free agency in 2019. Sources with knowledge of the investigation told The Athletic that year that the league looked into complaints that Dennis Robertson, Leonard’s uncle and business partner, requested improper benefits from teams during free agency, including part ownership of the team, a private plane, a house and a guaranteed amount of off-court endorsement money. Robertson is listed as Leonard’s “designated representative” on the endorsement contract with Aspiration obtained by Torre.
League sources with knowledge of the investigation told The Athletic in 2019 that no evidence was found to suggest that the Clippers had granted any of the requests. Los Angeles initially signed Leonard in 2019 on a three-year, $103 million contract as a free agent. He then signed a four-year, $176 million extension with the Clippers in 2021 and a three-year, $153 million extension in 2024.
Teams and players found to circumvent the salary cap can face penalties for a first offense, such as a team fine of up to $7.5 million; the “direct forfeiture of draft picks;” the voiding of a player’s contract (including renegotiations, extensions or amendments); a player fine up to $350,000; a suspension for team personnel and more.
“Pablo Torre Finds Out” is an independently produced show licensed by The Athletic and distributed on its podcast network. The Torre podcast signed a licensing agreement with The Athletic Podcast Network last month, and the episode released on Wednesday is the first under the new partnership.
(Photo: Ron Chenoy / Imagn Images)
