Steve Ballmer and The Clippers, Under NBA Investigation
The NBA has launched an investigation into Los Angeles Clippers owner Steve Ballmer and the team, following reports suggesting a possible salary cap violation. The controversy arises from an alleged $28 million sponsorship deal between Kawhi Leonard and the company Aspiration.
Ballmer, who previously invested $50 million in Aspiration, has denied having knowledge of the deal or instructing the company to carry it out.Aspiration: What Was It and Who Founded It?
Founded in 2013 by Joe Sanberg and Andrei Cherny, Aspiration Partners presented itself as a banking entity focused on sustainability and social responsibility. Its mission, according to its archived website, was to offer banking and investment services “socially conscious.” Its motto was “Do well. Do good.”
Sanberg, who was part of Aspiration’s board of directors, owned approximately 30% of the shares in September 2021. Cherny, for his part, was the CEO for almost a decade.The Aspiration Business Model
Aspiration defined itself as a digital bank with environmental awareness. The company promised that its customers’ deposits would not finance projects related to fossil fuels. It offered savings accounts, debit cards with rewards, and the option to plant a tree with each purchase.Featured Investors in Aspiration
Among Aspiration’s investors were notable figures such as Robert Downey Jr., Orlando Bloom, Leonardo DiCaprio, Milwaukee Bucks coach Doc Rivers, and Cindy Crawford with her daughter Kaia Gerber.The Connection Between Ballmer, Leonard, The Clippers, and Aspiration
In September 2021, Ballmer invested $50 million in Aspiration through his personal LLC. That same month, the Los Angeles Clippers signed a $300 million deal with Aspiration, becoming the “first founding partner” of the Intuit Dome.
In an interview, Ballmer revealed that Aspiration asked him to introduce the company to Leonard, which occurred in November 2021. According to reports, Leonard agreed to a $28 million sponsorship deal with Aspiration through his LLC KL2 Aspire in April 2022, nine months after renewing with the Clippers. An Aspiration employee suggested that the payment to Leonard sought to circumvent the salary cap.
It was reported that Dennis Wong, a minority owner of the Clippers, invested nearly $2 million in Aspiration in 2022, a few days before Leonard received a payment of $1.75 million from the company.
Ballmer made an additional investment of $10 million in March 2023.The NBA’s Reaction
The NBA is investigating whether Ballmer and the Clippers violated league rules. Commissioner Adam Silver stated that the league must analyze “the totality of the evidence” to determine if there was any irregularity.
The New York-based law firm Wachtell, Lipton, Rosen & Katz is conducting a thorough investigation, although a deadline for its conclusion has not been established.The Destiny of Aspiration
Cherny, co-founder and former CEO, left the company in 2022. In a statement, Cherny denied that Leonard’s contract was a “phantom” agreement.
Aspiration declared bankruptcy in March, with a reported debt of $170 million. The company owed $30 million to the Clippers and $7 million to Leonard’s LLC.
Recently, Aspiration co-founder Sanberg pleaded guilty to fraud. Federal prosecutors accused Sanberg of defrauding investors and lenders of $248 million.
Ballmer expressed his “shame” for not having detected problems in the review of Aspiration’s financial statements and business plans. “I was scammed,” he stated.
