Scandal in Los Angeles Clippers: Is Kawhi Leonard at the center of the controversy?
A Los Angeles Clippers limited partner is under fire after allegedly sending nearly $2 million to a company now in bankruptcy. This company, Aspiration, reportedly offered Kawhi Leonard an endorsement deal for “phantom work,” according to reports. The news, revealed by the podcast “Pablo Torre Finds Out”, indicates that the sponsorship deal may have been a strategy to circumvent the NBA’s salary cap. Aspiration, which had agreed to a $28 million deal with Leonard in 2021, received a $50 million investment from Clippers owner Steve Ballmer through his personal LLC. Two weeks later, the Clippers announced a $300 million partnership with Aspiration. Dennis J. Wong, a limited partner of the Clippers, invested $1.99 million in Aspiration nine days before the company made a $1.75 million payment to Leonard. This payment, which was reportedly delayed, came amid financial troubles that ultimately led to the company’s bankruptcy. The NBA is investigating whether Ballmer and the Clippers violated league rules due to Leonard’s agreement.The accusations initially arose when an anonymous person, allegedly employed by Aspiration, claimed that the agreement with Leonard aimed to circumvent the salary cap. The Clippers have denied any wrongdoing. Ballmer stated that they have always acted correctly and that Kawhi’s business is his own. The Clippers issued a statement saying they are cooperating with the NBA’s investigation and that the company Aspiration was a “house of cards” that defrauded Steve and many others. They hope to share the facts with the league and provide them with all the necessary information. According to reports, the NBA has hired the New York-based law firm Wachtell, Lipton, Rosen & Katz to conduct the investigation, with no deadline set for its conclusion. Leonard agreed to a four-year, $28 million sponsorship deal in April 2022 through his LLC, KL2 Aspire. A document stated that the agreement between Aspiration and KL2 Aspire would be void if Leonard left the Clippers. In addition, Leonard could “refuse to proceed with any action desired” by Aspiration and continue to receive payments. Aspiration declared bankruptcy in March and is under federal investigation for fraud. Joe Sanberg, co-founder of Aspiration, pleaded guilty to two counts of wire fraud, admitting to defrauding investors and lenders of more than $248 million. Under NBA rules, teams can be penalized for circumventing the salary cap. Penalties can include fines of up to $7.5 million, the loss of draft picks, the nullification of player contracts, and the suspension of any team staff member involved in such violation. The Clippers denied that Steve’s investment in Aspiration was aimed at channeling money to Kawhi Leonard. They stated that there is nothing unusual about team sponsors making sponsorship deals with players on the same team and that neither Steve nor the Clippers organization had any oversight of Kawhi’s independent sponsorship deal with Aspiration.I believe that, as with any process that requires a fundamental sense of justice, the burden should fall on the party that, in essence, brings those charges.
Adam Silver, NBA Commissioner
