NBA Investigating Clippers Over Salary Cap Circumvention Allegations

The NBA has initiated an investigation into the Los Angeles Clippers and team governor Steve Ballmer amid allegations that they may have circumvented the league's salary cap. This inquiry follows a report from podcaster and investigative journalist Pablo Torre, highlighting potential misconduct regarding a deal involving star player Kawhi Leonard.

NBA spokesperson Mike Bass confirmed the investigation to ESPN, stating, "We are aware of this morning's media report regarding the LA Clippers and are commencing an investigation." Torre's report, sourced from internal documents of the now-bankrupt company Aspiration, suggests that Leonard was contracted for a job with no responsibilities as part of an endorsement deal.

In April 2022, Leonard reportedly agreed to a four-year, $28 million endorsement deal through his LLC, KL2 Aspire, shortly after signing a lucrative four-year, $176.3 million contract with the Clippers, the highest permitted under the NBA's collective bargaining agreement at that time. The deal with Aspiration was alleged to be void if Leonard were to leave the Clippers, raising suspicions among insiders.

An anonymous employee from Aspiration, which faced its own controversies leading to bankruptcy and federal fraud investigations, stated that the arrangement was designed to circumvent the salary cap. Previously, Aspiration had a $300 million partnership with the Clippers.

In response to the allegations, the Clippers released a statement firmly denying any wrongdoing. The team maintained that neither Mr. Ballmer nor the organization circumvented the salary cap or engaged in misconduct associated with Aspiration. They emphasized that they severed ties with the company during the 2022-23 season following Aspiration's defaults and affirmed their willingness to assist law enforcement in any related investigations.

The repercussions for the Clippers could be severe, as the NBA's collective bargaining agreement allows for significant penalties against teams found guilty of circumventing salary cap rules, including hefty fines, loss of draft picks, and potential voiding of player contracts.