The National Basketball Association (NBA) has fined the Los Angeles Clippers $30 million and stripped the team of five first-round draft picks due to violations of salary cap circumvention rules related to star forward Kawhi Leonard. Leonard has been ordered to pay $700,000. The NBA's investigation, conducted over the course of a year, revealed a pattern of misconduct and multiple significant rules violations by the Clippers organization, which has previously violated salary cap rules.
The investigation focused on the team's introduction of Leonard to club sponsors for off-court income opportunities and endorsement agreements, which included offering business from the team as inducements and covering personal expenses for Leonard and his representatives. Companies involved included Boingo Wireless, Daktronics, Lockton Insurance, and Aspiration Partners, which allegedly signed Leonard to a $28 million endorsement deal and had a 23-year, $300 million sponsorship deal with the Clippers.
As a result of the violations, the Clippers must forfeit a first-round pick in each draft from 2029 to 2033. Leonard has been fined $700,000, and several executives have been suspended. Owner Steve Ballmer has been suspended for one year from all league and team activities for his role in facilitating off-court income opportunities for Leonard and for failing to ensure compliance with NBA rules. Team president of business operations Gillian Zucker is suspended without pay for one year for her direct involvement in the endorsement arrangements and for providing misleading statements to investigators. Lawrence Frank, the president of basketball operations, is suspended for six months without pay for his involvement in the endorsement arrangements.
The Clippers issued a statement disputing the league's findings and the validity of the investigation, claiming that the NBA's conclusions differ from what was communicated privately. They intend to challenge the findings and penalties through arbitration. Leonard, through his new agent Harrison Gaines, stated he had no knowledge of any intent to circumvent the salary cap and expressed regret for the distraction caused by the situation.
The NBA stated that the Clippers failed to report improper solicitations for off-court income made on Leonard’s behalf by his uncle and former business manager, Dennis Robertson, who has been banned from league activities for five years. The investigation was conducted by the law firm Wachtell, Lipton, Rosen & Katz, which continues to receive information, leaving open the possibility of further action.
Leonard, a two-time NBA Finals Most Valuable Player, averaged 27.9 points, 6.4 rebounds, and 3.6 assists in 65 games last season. The Toronto Raptors, who lost Leonard to the Clippers via free agency after winning the 2019 NBA championship, agreed in principle to a trade on June 30 to bring him back, pending the completion of the league’s investigation. The NBA and the National Basketball Players Association (NBPA) have agreed that the penalties are final and binding. NBA Commissioner Adam Silver expressed disappointment over the violations and emphasized the importance of the league's rules.