Los Angeles Clippers owner Steve Ballmer says he did nothing wrong when negotiating Kawhi Leonard‘s contract.
Ballmer addressed a report that alleged the Clippers circumvented the salary cap in an interview with ESPN’s Ramona Shelburne late Thursday.
“Up front, I want to say one thing very clearly. We, the Clippers have abided by the salary-cap circumvention rules because that’s the right thing to do,” Ballmer said. “We have done that. I happen for what it’s worth to think it’s a very important rule in terms of promoting competitiveness and equal playing field across the league. But whether I agreed with it or not, it’s the rule and we absolutely abided by it.”
The NBA opened an investigation Wednesday after a report revealed that Leonard was paid by a now-bankrupt environmental firm that had close ties to the Clippers and Ballmer in a deal that one former employee of the firm has said was designed to circumvent the NBA’s salary cap.
According to a report on the podcast Pablo Torre Finds Out published Wednesday, Leonard had a four-year, $28-million endorsement contract with the firm Aspiration, but is alleged to have provided no work as part of the deal. Documents obtained by Torre reveal Ballmer had invested $50 million in the firm shortly before Leonard’s endorsement deal went into effect in April 2022.
On Thursday, Torre said he had confirmed a Boston Sports Journal report that Leonard also had a $20-million side deal with Aspiration for company stock.
“We went through a litany of really, really top-tier name contracts, and then, ‘Oh, by the way, we also have a marketing deal with Kawhi Leonard, like a $28-million organic marketing sponsorship deal with Kawhi,’” a person described as a former financial department employee at Aspiration said in an interview with Torre on Wednesday. “And that if I had any questions about it, essentially don’t (ask), because it was to ‘circumvent the salary cap. LOL.’ There was lots of LOL when things were shared.”
In his interview with ESPN, Ballmer denied any wrongdoing.
“I can make it really simple. We cannot pay a player anything beyond what’s in his standard player contract and we cannot cause anybody else to pay the player what’s beyond their standard contract. That would include for example sponsors, endorsers, that is (not allowed). We can’t do that. And we didn’t, certainly in this instance,” he said.
The Clippers said Wednesday the team ended its relationship with Aspiration during the 2022-23 season, when Aspiration defaulted on its obligations.
Aspiration was a firm that promised its clients carbon credits and tree planting to offset carbon costs. The company went bankrupt in March after co-founder Joe Sanberg was arrested for wire fraud. Sanberg has since pleaded guilty to the charges.
Leonard signed a four-year, $176-million contract extension with the Clippers in August 2021. Then, in September 2021, according to documents obtained by Torre, Ballmer wired $50 million to Aspiration as part of a $315-million investment alongside other partners. That same month, Ballmer and Sanberg held a joint press conference during Clippers media day to announce a 23-year, $300-million sponsorship agreement that would see the Aspiration brand appear throughout the Clippers’ new arena, the Intuit Dome.
Leonard registered a limited liability company named KL2 Aspire in November 2021, and an endorsement contract between KL2 Aspire and Aspiration began in April 2022, according to documents obtained by Torre. Leonard’s uncle, Dennis Robertson, is listed as the Clippers star’s “designated representative” on the contract.
The contract included a clause that gave Leonard full control over the content of his endorsement of the company and included a clause that would terminate the deal if Leonard was no longer an employee of the Clippers. Torre reported that there was no evidence Leonard ever provided any endorsements for Aspiration on social media or other platforms.
Ballmer was asked why Aspiration might have made this kind of deal with Leonard, who won an NBA title with the Toronto Raptors in 2019 before signing with the Clippers that summer.
“I don’t know why they did what they did,” Ballmer said of Aspiration. “I don’t know how different it is. I really don’t. And frankly any speculation would be crazy. These are guys who committed fraud. They conned me. I made an investment in these guys thinking it was on the up and up and they conned me. At this stage, I have no ability to predict why they might have done anything they did.”
— With files from the Associated Press
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