Federal prosecutors in the Eastern District of New York have opened a criminal investigation into the Los Angeles Clippers over alleged secret sponsorship agreements for star forward Kawhi Leonard. The probe follows a year‑long NBA review that resulted in a $30 million fine, the forfeiture of five first‑round draft picks from 2029‑2033, and a one‑year suspension for owner Steve Ballmer.
Allegations and Potential Violations
The investigation focuses on undisclosed endorsement deals, including a reported $28 million agreement with the now‑bankrupt green‑finance firm Aspiration Partners. Prosecutors are examining whether the Clippers and Ballmer facilitated side deals that compensated Leonard beyond the league’s salary‑cap limits.
According to the U.S. Attorney’s Office, a grand jury has already issued at least one subpoena. The Securities and Exchange Commission has also joined the inquiry, requesting records from Daktronics, the company that supplied displays for the Clippers’ Intuit Dome, related to its sponsorship contracts with Leonard.
NBA Findings and Team Response
The NBA described the situation as a “pattern of misconduct” after a review by the law firm Wachtell, Lipton, Rosen & Katz. The league imposed the fine, draft‑pick forfeitures and suspensions for Ballmer, two top executives, and Leonard’s uncle and manager, Dennis Robertson, who received a five‑year ban. Leonard was ordered to pay $700,000 in restitution.
The Clippers issued a statement rejecting the league’s findings, calling the investigation “heavily biased” and asserting that it was designed to support a predetermined narrative. The franchise said it will “vigorously challenge these findings and penalties through every avenue available” and is seeking an impartial arbitration process.
Legal Opinions and Potential Lawsuits
Ballmer’s attorney, David Kelley, labeled the NBA’s investigation a “witch hunt” and a “gross injustice.” Kelley cited internal league discussions that, in his view, indicated the NBA did not believe an agreement existed between the Clippers and Aspiration to funnel money to Leonard. He also emphasized that federal authorities previously determined Ballmer was “a victim of Joe Sanberg’s fraud, not a participant.”
Leonard, while acknowledging mistakes by members of his inner circle, maintained that he entered into his Clippers contract and related agreements “in good faith” and had no knowledge of any effort to circumvent the salary cap. He expressed regret for the distraction the situation has caused fans and his family.
Next Steps
The Clippers are considering a federal lawsuit against the NBA to block the sanctions, but the criminal investigation could complicate that effort. Civil litigation may be delayed if key witnesses invoke their Fifth Amendment rights.
Spokespersons for the U.S. Attorney’s Office, the Clippers and the NBA declined to comment further on the investigation.
Original reporting: Fox News (HLL/CB) — read the source article.
