Scandal in Los Angeles Clippers: Investigation for Possible Irregular Agreement with Kawhi Leonard
A Los Angeles Clippers limited partner is under scrutiny after allegedly sending almost $2 million to a company now in bankruptcy. This company, according to reports, allegedly offered Kawhi Leonard a sponsorship deal for “phantom work,” a few days before the player received $1.75 million from the same. The company in question, Aspiration, allegedly agreed to a $28 million sponsorship deal with Leonard in 2021. Clippers owner Steve Ballmer invested $50 million through his personal LLC in September 2021, and the team announced a $300 million partnership with Aspiration two weeks later. Leonard, for his part, reportedly accepted a four-year, $28 million sponsorship deal in April 2022, nine months after re-signing with the Clippers. The situation is complicated by information that Dennis J. Wong, a limited partner of the Clippers, invested $1.99 million in Aspiration nine days before the company made the payment to Leonard. This payment, according to the schedule, was late, as the company was facing financial problems before declaring bankruptcy. The NBA is investigating whether Ballmer and the Clippers violated league rules by allowing Leonard to accept this deal. NBA Commissioner Adam Silver stated that the league will have to prove any irregularities on the part of the Clippers.The accusations initially arose when an unidentified person, who allegedly worked for Aspiration, claimed that the agreement with Leonard aimed to circumvent the salary cap. The Clippers have denied any wrongdoing. The team issued a statement in which they stated that the relationship with Aspiration is under investigation by the NBA, but that the company was a “house of cards” that defrauded Steve and many others. They added that they hope to share the facts with the league and provide them with all the necessary information. The NBA has hired the law firm Wachtell, Lipton, Rosen & Katz to conduct the investigation, with no set deadline for its conclusion. According to reports, Leonard agreed to the 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 being investigated for fraud at the federal level. Aspiration co-founder Joe Sanberg 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 could include fines of up to $7.5 million, the loss of draft picks, the voiding of player contracts, and suspension of up to one year for any team member involved. The Clippers have denied that Steve Ballmer’s investment in Aspiration was aimed at diverting money to Kawhi Leonard. They stated that there is nothing unusual about the team’s sponsors making sponsorship deals with players from the same team. Furthermore, they denied having any control over Kawhi’s independent sponsorship deal with Aspiration.“I think, as with any process that requires a fundamental sense of fairness, the burden should fall on the party that, in essence, brings those charges,” Silver said.
Adam Silver
