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Trial will decide D. Sterling's role

Wednesday, June 11, 2014
A Los Angeles County probate judge has scheduled a four-day trial for July 7-10 to determine whether Los Angeles Clippers co-owner Donald Sterling was properly removed as a trustee from the Sterling Family Trust, which agreed to sell the franchise to former Microsoft CEO Steve Ballmer on May 29 for a record $2 billion.

The lawyers for Shelly Sterling, who assumed the role of sole trustee and negotiated the sale with Ballmer after two neurologists determined Donald Sterling was mentally incapacitated and no longer able to conduct his own legal and business affairs, requested an expedited hearing so that the sale could be approved by the NBA Board of Governors by July 15 and closed by September 15, as outlined in the purchase agreement. Both Ballmer and Shelly Sterling have agreed to a grace period that allows for board approval by September 15.

Should the sale not be closed by September 15, Ballmer theoretically could pull out of the deal and the NBA would be forced to begin termination proceedings against Sterling again, then sell the team itself. However, sources say there is no indication Ballmer would do that.

Ballmer has not yet funded the $2 billion sale, except for the $300 million he put in escrow during the bid process.

The court denied Shelly Sterling's request for relief. However, according to the ruling obtained by ESPN, "... given the upcoming deadlines regarding the proposed acquisition of the Los Angeles Clippers, the Court, on its own motion, sets the matter on shortened notice for a contested evidentiary hearing" before Judge Michael Levanas. A trial conference, where a list of witnesses will be submitted, is set for June 23.

Bobby Samini, one of the lawyers representing Donald Sterling, told ESPN after Wednesday's hearing that he intended to bring in independent experts to evaluate his client's mental status. Thus far, Donald Sterling had been personally evaluated by two neurologists, whose diagnoses and findings subsequently have been reviewed by a third expert.

Those examinations were part of the evidence submitted to the court on Wednesday. They included details of Donald Sterling's medical reports, including the cognitive tests he was asked to perform as part of the evaluations.

According to court documents filed Wednesday, three doctors concluded in May that Donald Sterling suffers from "mild cognitive impairment consistent with early Alzheimer's Disease'' or some other forms of brain disease.

One doctor, James E. Spar, who is affiliated with the division of geriatric psychiatry at UCLA, said he believes "Mr. Sterling is at risk of making potentially serious errors of judgment, impulse control and recall in the management of his finances and his trust.''

"In my opinion he is substantially unable to manage his finances and resist fraud and undue influence, and is no longer competent to act as trustee of his trust,'' Spar concluded.

Dr. Stephen L. Read, who also specializes in geriatric and forensic psychiatry in Los Angeles, said that X-ray and CT scans of Sterling's brain conducted May 16 showed "mild atrophy'' of brain tissue.

Read said personal opinion and the statements of other doctors provide "solid grounds for the determination that Mr. Donald T. Sterling lacks the capacity to function as trustee of the Sterling family estate.''

A third doctor, Meril S. Platzer, said during her examination Sterling was unable to spell the word "world'' backwards in tests with doctors. He was unaware of the season, couldn't recall two objects after three minutes and had difficulty initially drawing a clock.

"The score is below normal for his age and advanced education,'' Platzer said.

She concluded that Sterling is unable to reasonably carry out the duties as trustee of The Sterling Family Trust because of impaired information processing and short-term memory, among other problems.

Samini disputed that Donald Sterling was mentally incapacitated and said he was confident the court would find that he was wrongfully removed as a trustee when it reviewed the findings.

"He's doing just fine," Samini said of Sterling. "His mental capacity is normal for a person of his age (80)."

Samini also said that Sterling was determined to fight the NBA's charges to terminate his ownership.

"We're going. Period," Samini said. "A week ago, he would have considered [selling]. But the NBA didn't want to give him his dignity. They want to disgrace him. They were looking for a reason to push him out."

Last week, Sterling, Samini and Sterling's other lawyer, Max Blecher, said that Sterling would consent to the sale. However, Blecher said they believed some consideration would be given to dropping Sterling's lifetime ban and $2.5 million fine from the NBA. League commissioner Adam Silver made it clear that was never going to happen in a press conference on Sunday.

"If the league had reached out to him and said, 'Let's work something out, we can restore your dignity,' I think it's possible he would have changed his mind," Blecher told ESPN on Tuesday. "But they didn't ... so he decided it wasn't worth doing the sale. He doesn't need the money. He wanted to fight for his dignity."

Now, Samini says that Sterling is ready for a long fight with the NBA.

"Now his objective is to demonstrate for everybody that the NBA is a damned hypocrite," Samini said. "We're going to pull every case against the NBA. Then we'll demonstrate that the culture of racism and gender discrimination is born at the NBA, where Adam Silver has worked in a high-level position for a long time."

Donald Sterling has a pending lawsuit against the NBA and Silver, seeking $1 billion in damages. However, as part of the sale agreement with Ballmer that was accepted by the league office, Shelly Sterling indemnified the league and Ballmer against any future legal action, meaning that even if Donald Sterling were to win that lawsuit, the damages would be paid by the Sterling Family Trust or by her as a private individual. 

Donald Sterling and his attorneys must first challenge and invalidate her authority to sell the team, as the sole trustee of the Sterling Family Trust, in probate court.

Sources said Wednesday's hearing was attended by Shelly Sterling's lawyers Pierce O'Donnell, Mark Stern and Caroline Heindel; Samini; two lawyers representing Ballmer and two lawyers from Skadden Arps representing the NBA.

In an interview with ESPN's Sage Steele during halftime of Game 3 of the NBA Finals, Silver said that the NBA is essentially "on the sidelines" and standing back and allowing "this dispute between Donald and Shelly Sterling to play itself out."

"We had scheduled a hearing for our owners in which we were going to move to terminate his franchise," Silver told Steele. "We never got to that hearing because Shelly Sterling said to us, 'I'm selling the team' and then she went and sold them the team. Donald's attorney actually sent us a letter saying he was agreeing to allow her to negotiate the sale of the franchise.

"But because we knew Donald was also suing us, we asked Shelly to indemnify us, to ensure if Donald didn't go along with the sale that she would cover us. She did. So this is really now a dispute between the Sterlings."

Information from The Associated Press was used in this report.

Related Video
Sterling's Role In Sale Goes To Trial
Sterling's Role In Sale Goes To Trial
Ramona Shelburne discusses whether there is a chance that a July trial to determine whether Donald Sterling was properly removed as a trustee from the Sterling Family Trust could derail the sale of the team to former Microsoft CEO Steve Ballmer.
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sports espn mentally incapacitated hearing los angeles clippers nba shelly sterling donald sterling family trust trial
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