On Wednesday, from the league office in New York, the NBA published the findings of its investigation into the Los Angeles Clippers and the 2022 signing of Kawhi Leonard, and set out what it intended to do about them.
The list is the longest any American sports league has issued. Five first round draft picks forfeited, in 2029, 2030, 2031, 2032 and 2033. A thirty million dollar fine. A one year suspension for the owner, Steve Ballmer. A year without pay for the president of business operations, Gillian Zucker, and six months for the president of basketball operations, Lawrence Frank. Seven hundred thousand dollars in restitution from Leonard. A five year ban from league business for his adviser and uncle, Dennis Robertson.
It is a severe punishment and the argument here is that almost none of it lands on anybody who did anything.
What the scheme was
A salary cap is an agreement among competitors not to compete on one particular thing. It exists because the alternative, in a league where the richest owner can outspend everybody, produces a competition nobody wants to watch. It only works if every party observes it, and every party has a continuous incentive not to.
The mechanism in this case was endorsement income. The investigation found that the Clippers arranged for corporate partners, among them Aspiration Partners, Boingo Wireless, Daktronics and Lockton Insurance, to route money to Leonard through endorsement arrangements in which he did little or nothing, in exchange for business from the team.
That is the elegance of it, in the bad sense. No money moved from the Clippers to Leonard. The team directed its own commercial spending toward companies that then paid a player, which is not a salary and does not appear against a cap, and which in economic substance is exactly a salary.
It surfaced because the sportswriter Pablo Torre reported it a year ago. Not because the system caught it.
Test one: who pays the picks
Five first round picks, starting three years from now and running to 2033.
A draft pick is not a possession in the ordinary sense. It is the right to add a young player to a roster, and its value is realized over the following decade. Removing five of them from a franchise is a genuine and lasting injury, and the injury is felt by the team that exists when the picks would have been used.
By 2033 the roster will contain nobody who is on it today. The coaching staff will have turned over at least once. The basketball operations department will be different people. Leonard, who is thirty five, will not be playing.
So the picks punish an institution across a decade, and the specific humans who arranged the endorsements will experience none of it. That is not a criticism of the choice. It is a description of what a franchise level penalty can and cannot reach.
Test two: what a suspension of an owner is
Ballmer is suspended for a year. Zucker loses a year of pay, Frank six months. Those are the individual penalties, and the asymmetry inside them is instructive.
Zucker and Frank are employees. A year without pay is a year without pay, and it is a real personal cost imposed on people who can be fired.
An owner cannot be fired. Ballmer is suspended from involvement in the operation of a team he continues to own throughout, whose value continues to accrue to him throughout, and at the end of which he resumes control. He is a man of enormous wealth and the thirty million dollar fine is, against that, an inconvenience.
The only penalty that would genuinely reach an owner is forced sale, which has been used once in this league and only for conduct of an entirely different kind. Short of that, the league’s hold over the people with the most to gain from cheating is the weakest hold it has.
Test three: what Leonard pays
Seven hundred thousand dollars in restitution.
Set that against what the arrangement was worth to him, which the investigation put in the tens of millions. The restitution is not a disgorgement of the benefit. It is a fraction of it, and the difference stays where it is.
Robertson, the adviser, is banned from league business for five years, which is the heaviest individual sanction on the list because it removes a livelihood rather than a portion of one. He is also the least powerful person named.
The verdict, and what it cannot fix
The penalties are the strongest available and they are aimed where the league’s authority actually reaches, which is at franchises, draft picks and employment. That is not weakness of will. It is the structure of the thing.
A league is a private association. Its rules are contractual, its tribunal is itself, and its sanctions are limited to the goods it controls. It cannot fine an owner into difficulty, cannot recover money that went from a third party to a player, and cannot reach back and undo a championship run financed by an advantage it did not detect at the time.
Which leaves the deterrent question open in a way this announcement does not close. The scheme ran for years. It was found by a journalist. The cost, discounted across the people who decided to do it, is a year away from the office for one of the richest men alive and a set of draft picks that will be missed by strangers.
The league office will expand a compliance function, and that will be reported. What will not be reported is the general manager somewhere else running the same arithmetic about their own corporate partners that the Clippers ran in 2022, and deciding whether the price announced on Wednesday is high enough to change the answer. Nothing published this week tells anybody which way that goes.
