Kawhi Leonard allegedly received a lucrative, no-work contract from a now-bankrupt environmental company with direct ties to his team, the LA Clippers, and franchise owner Steve Ballmer so that he could be paid more money without it counting against the NBA\u2019s salary rules, according to accusations made by former employees of the firm to a podcast.<\/p>\n
In the latest episode of the \u201cPablo Torre Finds Out\u201d<\/a> podcast, which was released Wednesday morning, seven anonymous former employees for San Francisco-based Aspiration, an environmental start-up company partly funded by a $50 million investment from Clippers owner Steve Ballmer, said the four-year, $28 million endorsement deal Leonard received in 2022 was for a \u201cno-show job\u201d intended to \u201ccircumvent the (NBA) salary cap.\u201d<\/p>\n \u201cWe went through a litany of really, really top-tier name contracts, and then (someone would say), \u2018Oh, by the way, we also have a marketing deal with Kawhi Leonard, like a $28 million organic marketing sponsorship deal with Kawhi,\u2019\u201d a person described as a former financial official for Aspiration said on the Torre podcast. \u201cAnd (they\u2019d say) that if I had any questions about it, essentially don\u2019t (ask), because it was to \u2018circumvent the salary cap. LOL.\u2019 There was lots of LOL when things were shared.\u201d<\/p>\n The NBA is \u201caware of this morning\u2019s media report regarding the LA Clippers and are commencing an investigation,\u201d league spokesman Mike Bass told The Athletic\u00a0on Wednesday afternoon<\/a>.<\/p>\n Messages left for Leonard\u2019s business partners were not immediately returned.<\/p>\n The Clippers\u2019 communications team sent the following statement to The Athletic: \u201cNeither Mr. Ballmer nor the Clippers circumvented the salary-cap or engaged in any misconduct related to Aspiration.\u00a0 Any contrary assertion is provably false: The team ended its relationship with Aspiration years ago, during the 2022-23 season, when Aspiration defaulted on its obligations.\u00a0 Neither the Clippers nor Mr. Ballmer was aware of any improper activity by Aspiration or its co-founder until after the government instituted its investigation. The team and Mr. Ballmer stand ready to assist law enforcement in any way they can.\u201d<\/p>\n This is the second time in Leonard\u2019s six seasons with the Clippers that accusations have surfaced suggesting he and his business representatives sought improper payments.<\/p>\n According to a 2019 report by The Athletic,<\/a> the NBA conducted a formal investigation of complaints that Leonard\u2019s uncle and chief business partner, Dennis Robertson, had asked for improper benefits from multiple teams when Leonard was a free agent that summer. Sources at the time said Robertson asked team officials for part ownership of the team, a private plane that would be available at all times, a house and a guaranteed amount of off-court endorsement money that they could expect if Leonard played for their team. League sources with knowledge of that investigation said no evidence was found indicating that the Clippers \u2014 who ultimately landed Leonard on a three-year, $103 million contract in the summer of 2019 \u2014 had granted any of the lavish requests, but Silver said if further evidence surfaced the league would re-open its investigation.<\/p>\n Teams and players found by the league to have illegally circumvented the salary cap are subject to fines, loss of draft picks, and even suspensions, as well as the voiding of player contracts. In 2000, the NBA punished the Minnesota Timberwolves and Joe Smith for circumventing the salary cap through a series of one-year deals with the promise of a longer, much richer contract afterwards. Then-commissioner David Stern fined the team $3.5 million, took away five future first-round picks, and suspended then-team owner Glen Taylor and then-chief basketball executive Kevin McHale for a year. Stern also voided all of Smith\u2019s one-year contracts with the Timberwolves, which prevented him from being eligible for the $86 million contract he was to get from the team.<\/p>\n Ballmer is the richest owner in the NBA, with a personal fortune of $153 billion, according to Forbes. Additionally, Ballmer\u2019s Intuit Dome is the host for the 2026 NBA All-Star Game, as well as the basketball tournament site for the 2028 Summer Olympics in Los Angeles.<\/p>\n Four summers before the Leonard-related accusations in the summer of 2019, Ballmer\u2019s alleged handling of a player\u2019s off-court finances first drew the attention of the league office. The Clippers were fined $250,000 in August 2015 relating to the free agency of big man DeAndre Jordan. The league found that the Clippers included a third-party endorsement deal in their pitch to Jordan in the form of a contract with Lexus that would have reportedly paid him $200,000 annually.<\/a><\/p>\n It is unknown if Ballmer was aware of the employment agreement between Aspiration and Leonard and what role, if any, that Ballmer played in facilitating the relationship between the environmental start-up and his star player.<\/p>\n Aspiration was a \u201cgreen bank\u201d that promised to supply carbon credits and plant trees to offset its clients\u2019 carbon emissions. It filed for bankruptcy protection in March after its co-founder, Joe Sanberg, was arrested on charges of wire fraud. Sanberg pleaded guilty last month to defrauding investors of $248 million.<\/p>\n In publicly available bankruptcy filings reviewed by The Athletic, Aspiration\u2019s three largest creditors listed are the Clippers, who say they are owed $30 million by the environmental firm; Forum Entertainment (also owned by Ballmer, claiming it is owed a debt of $11 million); and Leonard\u2019s personal limited liability company, \u201cKL2 Aspire,\u201d claiming a debt of $7 million.<\/p>\n But the Torre podcast, which claims to have reviewed Aspiration\u2019s internal emails and contracts with Ballmer and Leonard, said Ballmer agreed to wire $50 million to the start-up company in September 2021, a month after Leonard signed a team-friendly, four-year, $176 million contract extension with the Clippers. Just weeks after Ballmer agreed to wire the money, the Clippers announced Aspiration as its team sponsor in a 23-year, $300 million deal.<\/p>\n Leonard registered his limited liability company in November 2021 and, according to the podcast, his $28 million contract with Aspiration took effect in April 2022. He could have signed a shorter contract with the Clippers in 2021 that would have allowed him to become a free agent again in 2022 \u2014 when he would have been eligible for a $235 million contract. So the four-year deal he agreed to with the Clippers gave the team financial flexibility against the salary cap, as well as the security of knowing their best player was under contract for years.<\/p>\n Leonard again signed a team-friendly deal with the Clippers in January 2024<\/a>, a three-year, $153 million contract for less money (about $70 million) than he could have earned. The deal was framed as allowing the Clippers to have the financial flexibility to potentially re-sign fellow stars James Harden and Paul George.<\/p>\n According to the Torre podcast, language in Leonard\u2019s endorsement contract with Aspiration gave him \u201cthe exclusive right to control and approve all content and distribution,\u201d and gave Aspiration the right to terminate the contract \u201cif Leonard is no longer an employee of the [Clippers] for any reason.\u201d<\/p>\n Additionally, the Torre podcast said, there is no evidence of social media posts, photographs or appearances by Leonard promoting Aspiration, as stipulated in the contract. However, The Athletic found at least one social media post from the Clippers tagging Aspiration and referencing Leonard. (The team did the same for several other players without known ties to Aspiration, and Leonard did not retweet the post.)<\/p>\n Happy Birthday, Kawhi! \ud83c\udf89<\/p>\n For every comment\/retweet, @Aspiration<\/a> will plant one tree for Kawhi\u2019s birthday! pic.twitter.com\/8zvZpj1xic<\/a><\/p>\n \u2014 LA Clippers (@LAClippers) June 29, 2022<\/a><\/p>\n \u00a0<\/p>\n \u201c(Leonard) didn\u2019t have to do anything,\u201d the former finance department official at Aspiration, said on the Torre podcast. \u201cUncle Dennis demanded payment. It was priority one. It was something that had to be done, and it was crucial to our relationships with Ballmer and the Clippers.\u201d<\/p>\n Robertson, Leonard\u2019s uncle, is listed as the \u201cdesignated representative\u201d on the contract with Aspiration, according to Torre\u2019s podcast. Messages left for Robertson by The Athletic were not returned.<\/p>\n Per Section 3 of Article XIII, which details the \u2018Penalties\u2019 within the section that covers salary cap circumvention, any team that violates league rules for a first time, as well as the player, could face the following outcomes (after their case goes to an Appeals Panel).<\/p>\n A fine of up to $7.5 million. \u201cPablo Torre Finds out\u201d 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<\/a> and the episode released Wednesday is the first under the new partnership.<\/p>\n<\/p>\n Law Murray contributed reporting.<\/p>\n (Photo: Ron Chenoy \/ Imagn Images)<\/p>\n
\nThe \u201cdirect forfeiture of draft picks.\u201d
\nThe voiding of the player\u2019s contract, \u201cor any Renegotiation, Extension, or amendment of a Player Contract, between such player and such Team.\u201d
\nA fine of up to $350,000 for the player.
\nA suspension for up to one year for \u201cany Team personnel found to have willfully engaged in such violation.\u201d
\nThe voiding of any transaction or agreement found to have violated league rules, and the forced forfeiture of funds received in the deal \u201cunless the player establishes by a preponderance of the evidence that he was unaware of the violation.\u201d<\/p>\n