LOS ANGELES (AP) \u2014 The NBA said Wednesday that it will investigate if a $28 million endorsement contract between Kawhi Leonard and a California-based sustainability services company allowed the Los Angeles Clippers to circumvent league salary cap rules, following a report by journalist Pablo Torre.<\/p>\n
The probe will focus on ties between Leonard, the Clippers and a company called Aspiration Fund Adviser, LLC, which filed for bankruptcy this year. It listed several creditors at that time, among them the Clippers (who were owed about $30 million) and a company called KL2 Aspire LLC that was owed $7 million.<\/p>\n
Leonard is listed as the manager of that company in California filings. KL is his initials, and 2 is his jersey number. Emails sent to his listed representatives seeking comment Wednesday were not immediately returned.<\/p>\n
\u201cWe are aware of this morning\u2019s media report regarding the LA Clippers and are commencing an investigation,\u201d NBA spokesman Mike Bass said Wednesday.<\/p>\n
The Clippers denied that any league rules were broken. Clippers owner Steve Ballmer made a $50 million investment in Aspiration, and the company and the team announced a $300 million partnership in September 2021. That was about a month after Leonard signed a four-year, $176 million extension with the Clippers.<\/p>\n
\u201cNeither Mr. Ballmer nor the Clippers circumvented the salary cap or engaged in any misconduct related to Aspiration,\u201d the Clippers said in a statement released to several media outlets, including The Associated Press. \u201cAny 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.\u201d<\/p>\n
Aspiration\u2019s co-founder, Joseph Sanberg, agreed to plead guilty last month after facing federal charges of wire fraud. Prosecutors said he defrauded investors and lenders out of $248 million, adding that \u201cAspiration\u2019s financial statements were inaccurate and reflected much higher revenue than the company in fact received.\u201d<\/p>\n
Torre, in his reporting, obtained a copy of the endorsement agreement between Aspiration and KL2 Aspire, one that called for Leonard to be paid $7 million annually for four years. Given that timetable, Leonard still would have been owed the final $7 million at the time of Aspiration\u2019s bankruptcy filing.<\/p>\n
There is no evidence that Leonard did anything to publicly endorse Aspiration.<\/p>\n
\u201cNeither the Clippers nor Mr. Ballmer was aware of any improper activity by Aspiration or its co-founder until after the government instituted its investigation,\u201d the Clippers said. \u201cThe team and Mr. Ballmer stand ready to assist law enforcement in any way they can.\u201d<\/p>\n
The league \u2014 which previously looked into claims that Leonard\u2019s representatives asked for certain things that would be considered cap circumventions when he was a free agent several years ago \u2014 can issue stiff penalties if cap rules are found to have been broken by a team, including a fine of up to $7.5 million, the voiding of contracts and the forfeiture of future draft picks.<\/p>\n
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