Latest progress! A well-known law firm is hired to investigate Xiaoka Yin-Yang contract and has investigated the Sterling and Saffer cases

On September 6, according to a person familiar with the matter, the NBA has hired a New York-based Wikata law firm to investigate the endorsement agreement between Los Angeles Clippers star Kawhi Leonard and a bankrupt environmental protection company. The investigation centers on one allegation that the endorsement agreement may help the Clippers and their billionaire boss Ballmer evade the league's salary cap.

Investigation background: Anonymous allegations and details of multiple disputes

The direct fuse of this investigation was the allegation raised by anonymous employees of Aspiration. The employees said that the four-year, $28 million endorsement agreement signed with the company in 2022 is essentially a "named job contract" and its real purpose is to "avoid the NBA salary cap."

Subsequently, the Boston Sports Daily further revealed that Leonard also had a second agreement with the company worth about $20 million, and the compensation was intended to be paid in the form of company shares held by the company's co-founder Joe Thunberg. At present, Thunberg has agreed to plead guilty to the charge of "scam investors $248 million".

Investigation Team: A "professional" trusted by the NBA has revealed that in addition to the Weikai Law Firm, which leads the investigation, the NBA legal department will also send an internal investigator to participate in the consultation to ensure that the investigation process is rigorous.

It is worth noting that Weikai Law Firm is not the first time that it has undertaken major investigation cases in the NBA - the previous two cases involving team boss violations and ultimately resulting in the boss being forced to sell the team are all responsible for:

2014 Donald Sterling case: At that time, former Clippers boss Sterling was investigated by Weikai Law Firm for making many racist remarks against NBA legendary star "Magician" Johnson. Eventually the league forced Sterling to sell the team.

2022 Robert Saffer case: Former Phoenix Suns boss Saffer was exposed to have had many inappropriate remarks and behaviors. After investigation by Weikai Law Firm, Saffer was suspended for one season and then chose to sell the team.

In addition, the law firm is also deeply involved in NBA business affairs. For example, when the Boston Celtics were sold for $6.1 billion in March 2024, Wickstar Law Firm was one of the agencies responsible for related legal affairs. The relationship and denial of the timeline and key figure responses to Ballmer: According to Forbes data, Ballmer, 69, is the wealthiest boss in the NBA, with a personal net worth of $153 billion. He had long been involved with Aspiration: in 2021, he agreed to invest $50 million in the company; Aspiration was also announced as the Clippers' new jersey and stadium sponsor, with the original agreement lasting 23 years and worth $300 million.

Balmer repeatedly denied any misconduct, saying that he was only "introducing Leonard to them at the request of Aspiration executives" and had no idea of ​​the details of the company's employment agreement with Leonard.

Leonard's "Zero Job" endorsement: Leonard's endorsement contract shows that it contains a key clause - Leonard has the right to refuse any job requests from the company. There is no evidence that Leonard has provided any substantive services to Aspiration.

Creditorship in bankruptcy: In Aspiration's bankruptcy case, the Clippers and Ballmer's Forum Entertainment were the company's top two creditors; while Leonard ranked third, and he was owed $7 million in compensation according to bankruptcy documents.

Historical controversy and potential punishment

This investigation is not the first time that Leonard and the Clippers are involved in "salary cap-related disputes": when Leonard became a free agent in the summer of 2019, his uncle and agent Dennis Robertson asked several teams who were interested in signing for a series of off-court benefits that exceeded the league's rules, and Leonard eventually joined the Clippers. The NBA also launched an investigation at that time, but no violations were found for the team.

In January 2024, Leonard's contract renewal with the Clippers attracted widespread attention from the league - the contract is not a maximum salary agreement, and the "team-friendly" clause with a total of $153 million in three years has retained more lineup operation flexibility for the Clippers.

If the NBA ultimately determines that Ballmer, the Clippers and/or Leonard has violated the rules, it may face severe punishment under the league's labor and capital agreement. It should be noted that the Clippers had a similar violation of regulations: in August 2015, the team was fined $250,000 for violating the rules during the free agent signing process of DeAndre Jordan. If the violation is determined to be a "second violation" this time, the punishment will be significantly escalated.

Under Article 13, paragraph 3 of the Labor Agreement (the penalty clause regarding "Wage Cap Abstention"), after the Appeal Board determines, the team and the relevant players who violate the rules may face the following consequences-the team may be fined up to US$7.5 million; the team directly deprived of the draft pick; the player's existing contract with the team, or the contract renegotiation, renewal and amendment clauses; the player may be fined up to US$350,000; the team staff who intentionally participate in the violation may be suspended for up to one year; the transaction or agreement that is deemed to be violated and the amount collected in the agreement is forced to recover (unless the player can provide sufficient evidence to prove that he is unaware of the violation).