The NBA brought the hammer down on the LA Clippers and owner Steve Ballmer for circumventing the salary cap to funnel more money to Kawhi Leonard — and now federal prosecutors are looking into the matter.
The Justice Department has opened a criminal investigation into the Clippers’ efforts to secure “no-show” endorsement deals for Kawhi Leonard, the New York Times reports. This investigation is being run out of the U.S. Attorney’s Office in Brooklyn, the office that has traditionally looked into issues with professional sports leagues.
The investigation is in its earliest stages, and it’s unclear what, if any, federal charges could come out of it, according to the report.
The Justice Department investigation comes in addition to the Securities and Exchange Commission looking into Daktronics’ role in the scandal, as it had an endorsement deal with Leonard despite never having had a celebrity endorser before and there being no evidence Leonard did anything for the company. Daktronics is publicly traded, and the SEC is tasked with protecting shareholders.
The NBA oversaw a year-long investigation of its own into the Clippers working to circumvent the salary cap with Leonard and last month came down with the harshest penalties ever imposed on a team:
• The Clippers surrender five first-round draft picks (2029, 2030, 2031, 2032, and 2033).
• The Clippers are fined $30 million.
• Clippers owner Steve Ballmer is suspended from anything to do with the team or the league for one year.
• Clippers President of Business Operations Gillian Zucker is suspended for one year, while President of Basketball Operations Lawrence Frank is suspended for six months.
• Kawhi Leonard must pay a $700,000 fine, and his already-fired business manager, Dennis Robertson (better known as “Uncle Dennis”), is banned from conducting NBA business for five years.’
Ballmer and the Clippers have steadfastly denied any wrongdoing and released this statement after the NBA released its findings and punishments.
“We vehemently reject the NBA’s findings, which are the result of a heavily biased investigation seeking to justify a predetermined narrative rather than facts and evidence. What the league told us privately differs from what it announced today publicly, and they have not held themselves close to the standard Commissioner [Adam] Silver set at the start of this investigation to ensure its fairness and accuracy.”
The Clippers attorney also sent a letter to the league, but the franchise’s only recourse now is the courts, and legal experts have suggested that is a serious uphill fight for Ballmer and the Clippers.
Now, that might not even be the worst of their legal troubles.
