Steve Ballmer got suspended by the NBA because of a podcast and a jumbotron corruption scandal

The NBA has suspended Los Angeles Clippers owner Steve Ballmer for one year after an investigation found that arrangements linked to the team helped deliver extra compensation to star forward Kawhi Leonard outside the league’s salary-cap system. The penalties also include a $30 million fine for the Clippers and the loss of five future draft picks. Team president of business operations Gillian Zucker received a one-year suspension as well.

The case grew from questions surrounding Leonard’s reported $28 million endorsement arrangement with Aspiration, a financial-services company that later entered bankruptcy proceedings. In an interview last September, Ballmer said the Clippers had no role in the deal, despite concerns that Leonard appeared to have provided little or no conventional promotional work in return. A league-commissioned report now challenges that account.

The 35-page investigation, prepared by the law firm Wachtell, Lipton, Rosen & Katz, said Ballmer’s public statements about his involvement were inaccurate and found Zucker’s denials to be plainly untrue. Leonard accepted a $700,000 fine, while his business manager was barred. The findings describe a network of commercial arrangements involving the franchise, its venue projects, outside companies, and payments connected to Leonard.

Attention first focused on Aspiration after reporting by the podcast Pablo Torre Finds Out, which examined the company’s relationship with Leonard and the Clippers. The reporting helped turn a little-known startup into a central figure in a broader inquiry. The NBA report credits the podcast with bringing the matter to light, although the Clippers have argued that the league acted on unsupported allegations from a podcaster.

A major part of the investigation concerns Daktronics, the digital-display company selected to provide scoreboard and signage technology for the Clippers’ Intuit Dome. In 2020, the team sought a “spend back” arrangement under which Daktronics would direct business toward the Clippers. Investigators said Zucker suggested that this could take the form of an endorsement agreement with Leonard.

According to the report, a Clippers executive specified that Daktronics should pay Leonard $3 million over two years. The same executive later told the company to raise Leonard’s compensation after the team increased its spending on the arena display project. Daktronics built the Intuit Dome’s enormous Halo Board, a double-sided wraparound 4K screen measuring 44,000 square feet and reportedly costing more than $100 million.

The report also examines Aspiration’s ties to the Clippers and the team’s former home, the Forum. Ballmer and Zucker said an annual $7 million agreement involving the venue was based on a consultant’s assessment of the cost of offsetting its carbon emissions. But the consultant told investigators that the Clippers had instead supplied a $28 million budget for the work. The $7 million yearly figure matched Leonard’s reported payments from Aspiration.

Investigators said Aspiration cofounder Joe Sanberg told company executives that the Clippers wanted the Leonard arrangement and would provide additional business to offset its cost. Sanberg, whose company promoted itself as an environmentally focused financial business, was later sentenced to 14 years in prison in a fraud case involving $248 million in investor losses. The NBA’s punishment did not center on Ballmer’s $50 million Aspiration investment, but the company’s dealings remain key to the inquiry.

Other firms are also under scrutiny. The report identifies Lockton Insurance and Boingo Wireless as Clippers-affiliated companies connected to another $18 million in alleged extra payments for Leonard. Daktronics and Aspiration cooperated with investigators, according to the report. Lockton declined to cooperate, while Boingo initially provided information that investigators found inconsistent or unreliable before ending its participation. The inquiry remains open over a separate consulting agreement that investigators suspect may have been used to route money toward Leonard.

The Clippers have protested the outcome and said Ballmer’s legal costs have reached $50 million, while also warning that the case has damaged his reputation and affected business partners. Ballmer’s lawyers said they are considering legal options. The next test will be whether further league findings alter the existing penalties or reveal additional details about the commercial relationships that surrounded Leonard’s compensation.

Source: The Verge