NBA's Sterling strategy emerges

Tuesday, May 06, 2014
In the week since announcing it was banning Los Angeles Clippers owner Donald Sterling for life, with the hopes of getting approval from the league's owners to force him to sell the team, little has been known of the NBA's exact legal strategy.

While the league's constitution, publicly revealed for the first time by the league last Tuesday, made it clear that grounds exist to remove an owner if that owner "fail(s) or refuse(s) to fulfill its contractual obligations to the Association," it remained unclear what contracts Sterling might have violated when he made his racist statements in a private conversation with his mistress V. Stiviano that was later published by TMZ.

But sources with knowledge of the league's strategy say there are, in fact, actual contracts that it will maintain Sterling violated should he choose to fight the league's desire to force him to sell the team if the league can get the required 75 percent of owners to agree to make the move.

One of those documents, which Sterling signed when he first bought the Clippers in 1981, and signed various amended versions since, states that an owner will not take any position or action that will materially and adversely affect a team or the league. Owners also sign morals clauses, which state that they will be upheld to the highest standard of ethical and moral behavior.

When morals clauses are enacted and result in termination of agreements, including endorsement deals, the courts are often charged with interpreting who was right, but sources with knowledge of the NBA's legal strategy believe that they have enough to force Sterling to sell.

Many big names, including a team of Oprah Winfrey, Oracle's Larry Ellison, the fifth-richest man in the world according to Forbes, and entertainment magnate David Geffen have expressed their interest in perhaps buying the team, which could sell for upwards of $1 billion.

But that assumes that Sterling, a lawyer by trade who is very familiar with the legal system, won't drag the league into court.

On Saturday, the league announced they would appoint a CEO that would take over day-to-day operations of the Clippers. On Tuesday, the NBA announced that Sterling's right-hand man, team president Andy Roeser, would be taking an indefinite leave of absence.

Still remaining as part of the ownership team is Shelly Sterling, who has been separated from her husband for several years, though still married. She has distanced herself from him, saying she supports the league's action, and released a statement calling herself "co-owner," leading some to believe that she too could put up a fight if she so desired. Sources have told ESPN.com's Ramona Shelburne that Shelly Sterling has spoken to the league expressing her desire to keep the team.

Meanwhile, two California State Assembly members from the Los Angeles area filed a bill Tuesday that, if passed and put into law, would prevent owners of sports teams from including league fines in business-expense tax write-offs as part of their state tax returns.

"Donald Sterling's outrageous comments and historic fine should not be rewarded with a multimillion-dollar tax refund," said Democratic Assemblyman Raul Bocanegra, who filed the legislation along with Reggie Jones-Sawyer. "This fine is intended as a punishment; it should not be used as a tax loophole."

The Clippers took a 1-0 lead in their Western Conference semifinals matchup against the Oklahoma City Thunder with a convincing 122-105 victory Monday night.

Related Video
Sources: NBA Says Sterling Violated Contracts
Sources: NBA Says Sterling Violated Contracts
ESPN sports business reporter Darren Rovell breaks down the latest news in the NBA's strategy to force Donald Sterling to sell the Clippers.
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sports espn legal los angeles clippers nba shelly sterling owner court andy roeser donald sterling team sale racism
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