NBA Commissioner Adam Silver holds a press conference to discuss Los Angeles Clippers owner Donald Sterling at the Hilton Hotel on April 29, 2014 in New York City. (Elsa/Getty)
UPDATE: 5/12/14, 8:34 a.m. EDT. Shelly Sterling told ABC’s Barbara Walters this weekend that she eventually intends to file for divorce from Donald Sterling, although the league has said she will not be able to retain an ownership interest in the Clippers if her husband is forced to sell the team. Sterling himself has asked for forgiveness in an interview with CNN’s Anderson Cooper.
A week after hitting Los Angeles Clippers owner Donald Sterling with a lifetime ban for racist comments he made to his mistress, the National Basketball Association has appointed former Citigroup and Time Warner chairman Richard Parsons as the team’s interim CEO.
“I believe the hiring of Dick Parsons will bring extraordinary leadership and immediate stability to the Clippers organization,” NBA Commissioner Adam Silver, a former Cravath, Swaine & Moore associate, said in a statement announcing the appointment. “Dick’s credentials as a proven chief executive speak for themselves, and I am extremely grateful he accepted his responsibility.”
In moving into the job, Parsons takes operational control of a franchise locked in a playoff battle with the Oklahoma City Thunder. With the NBA insisting that the team be sold, the former managing partner of New York’s Patterson Belknap Webb & Tyler—Parsons left the firm in 1988—is also set to preside over a process that has attracted a bevy of big-name bidders. One deep-pocketed group circling the Clippers, who could fetch up to $1 billion if sold, is reportedly being led by Hollywood mogul David Geffen, media icon Oprah Winfey and Oracle billionaire Larry Ellison. (Arent Fox advised Ellison on his unsuccessful bid to buy the NBA’s Golden State Warriors in 2010.)
Sterling, an active member of the California bar, has said publicly he does not plan to sell the Clippers despite the NBA’s stance. And with an eye toward the court battle that may be looming, Sterling has reportedly approached firms like Quinn Emanuel Urquhart & Sullivan and Glaser Weil Fink Howard Avchen & Shapiro about representing him should he end up in litigation with the league.
As The Am Law Daily first reported last week, Skadden, Arps, Slate, Meagher & Flom is preparing a legal defense for the NBA against any action Sterling might take, presumably on breach-of-contract grounds. And as if there wasn’t already plenty of legal firepower lined up in the Sterling saga, yet another high-powered attorney entered the fray this week.
Pierce O’Donnell, a former Kaye Scholer partner who joined Los Angeles–based boutique Greenberg Glusker Fields Claman & Machtinger in March, is now representing Sterling’s estranged wife, Shelly, in her effort to keep control of the Clippers, according to sibling publication The National Law Journal.
“She’s done nothing wrong,” O’Donnell told The NLJ. “The commissioner said that the racist comments were her husband’s and banned him for life. She wants to retain 50 percent ownership interest.”
The Sterlings have many reasons for wanting to hold on to the Clippers—including the tax implications of unloading the team before they both die—but for now the team’s lawyers aren’t commenting on how the Parsons hire and the threat of a forced sale may affect the franchise.
Clippers general counsel Robert Platt—a longtime attorney for Sterling and litigation partner with Manatt, Phelps & Phillips in Los Angeles—declined a request for comment on the matter.
National Pastime a Boon to Big Firms
The legal issues related to Major League Baseball players’ use of performance-enhancing drugs have in past years translated into substantial fees for lawyers and other legal professionals paid out of players’ union coffers, as we’ve previously reported in this space. And a review of the Major League Baseball Players’ Association most recent LM-2 filing with the U.S. Department of Labor shows that last year saw more of the same.
Fredric Horowitz, the chief baseball arbitrator who presided over a key ruling in the bizarre Biogenesis scandal that led to the yearlong suspension of New York Yankees star Alex Rodriguez, is listed in the MLBPA’s Labor Department filing detailing its various business affairs as receiving $69,141 for his services last year in five “special health” and “grievance-arbitration” hearings. (Baseball arbitrators are paid by both the union and the league.)
San Francisco’s Altshuler Berzon—which as The Am Law Daily reported last year took the lead for the union in the Biogenesis investigation—is listed as receiving $251,017 for its services in 2013. The MLBPA also paid $102,571 to Cooley and $19,628 to Florida-based Akerman for “special health litigation” counsel last year.
Pittsburgh’s Farrell & Reisinger—a small firm formed by Dreier LLP refugees with a large pro athlete clientele—received $65,020 for “salary arbitration” work. Other firms on the union’s 2013 payroll include McCarter & English ($132,875); Boston’s Hemenway & Barnes ($57,016); Winston & Strawn ($21,135); Washington, D.C.’s Bredhoff & Kaiser ($16,246); White & Case ($15,244); and Miami’s Phillips, Richard & Rind ($6,850).
The MLBPA also paid $12,500 to the Phoenix-based consulting and public policy firm The Dunn-Stewart Group and another $8,926 to former Massachusetts state senator Steven Panagiotakos for “legislative” advice. Kevin McGuiness, a Washington, D.C.–based lawyer hired in January to serve as the union’s new COO, earned a total of $97,707 last year as an outside lobbyist.
Kansas City, Mo.–based attorney Steven Fehr, the brother of former MLBPA executive director Donald Fehr (who received $112,221 in retirement benefits in 2013), received a total of $46,838 last year for his work on health litigation and collective bargaining issues.
Michael Weiner, the well-regarded former MLBPA general counsel turned executive director who died in November following a long battle with brain cancer, received $1.1 million in salary and an additional payment of $3 million. His successor as executive director, former player Tony Clark, received $721,460 in total compensation in his previous role as director of player relations and deputy executive director.
Other individuals on the union’s in-house legal staff (and their 2013 compensation) include general counsel David Prouty ($692,749); senior labor counsel Ian Penny ($533,619); senior counsel for business affairs and licensing Timothy Slavin ($525,000); and assistant general counsel Robert Lenaghan ($461,325), Matthew Nussbaum ($338,438), Heather Chase ($283,906), Robert Guerra ($176,184) and Michael Stival ($128,607). Senior executive adviser and attorney Richard “Rick” Shapiro, an arbitration expert hired by the union in late 2009, was paid $705,000.
The National Football League Players Association—busy with the annual draft of new members this weekend in New York—usually files its LM-2 around Memorial Day. An email sent Thursday to former NFL player and union general counsel Thomas DePaso, director of finance Charles Ross and a spokesman seeking an early copy of the filing did not yield an immediate response.
Cahill, O’Melveny Ink Olympic Deal
Three years after Cahill Gordon & Reindel and O’Melveny & Myers advised on a $4.38 billion Olympic-size media rights deal, the two Am Law 100 firms have reprised their roles by helping to hammer out a $7.75 billion extension of that broadcast contract between Comcast’s NBC Universal and the International Olympic Committee.
The IOC and New York–based NBC Universal announced this week that they have reached an agreement under which the network will continue broadcasting the Olympic Games in the U.S. from 2022 through 2032. The biannual festivities usually generate big ratings for the company, which has struggled to find successful nonsports programming.
Taking the lead for NBC Universal was its longtime go-to Olympic deal lawyer, James Clark, a Cahill Gordon & Reindel corporate partner who serves on the firm’s executive committee. Clark spoke with The Am Law Daily in 2011 about how he first started working on Olympic media deals after the U.S. boycotted the 1980 Summer Games in Moscow.
For its part, the Lausanne, Switzerland–based IOC turned to O’Melveny entertainment, sports and media practice chair Joseph Calabrese and partner Christopher Brearton—the managing partner of the firm’s Century City office—for outside counsel on the contract extension. Calabrese and Brearton are longtime legal advisers to the IOC, and Brearton carried the Olympic torch prior to the Winter Games in Vancouver in 2010, according to our previous reports.
Covington & Burling is representing the U.S. Olympic Committee on the renewal of its broadcast rights with Comcast and NBC Universal.
Around the Horn
—The NBA’s Los Angeles Lakers have hired Daniel Grigsby, chair of the sports law practice at Jeffer Mangels Butler & Marmaro, as the team’s new general counsel. Grigsby, a longtime outside lawyer to the storied franchise, replaces Jim Perzik, who is being promoted to senior vice president of legal affairs.
—Boies, Schiller & Flexner founder David Boies and noted antitrust lawyer Michael Hausfeld are teaming up to start a joint practice designed to represent pro athletes. The announcement comes on the heels of a move by Winston & Strawn last year to start its own college sports group. Hausfeld is the lead attorney in the landmark Ed O’Bannon antitrust case pending against the National Collegiate Athletic Association, whose June 9 trial date the Indianapolis-based organization is trying to postpone.
—Fantex, a San Francisco–based startup selling stock tied to the future performance of San Francisco 49ers tight end Vernon Davis, saw its long-awaited initial public offering price in late April. Latham & Watkins took the lead on the IPO for Fantex, while Cooley represented underwriters, according to an SEC filing, which shows the listing generated $350,000 in legal fees and expenses. Last year Fantex sought to sell stock linked to the performance of Houston Texans running back Arian Foster, but delayed the float after Foster fell victim to a season-ending injury.
—New York’s economic development arm recently approved a $350,000 contract with Foley & Lardner to help keep the NFL’s Buffalo Bills in the Empire State. The team, which will likely be sold later this year, recently scrapped its cheerleading squad in response to a wage-and-hour suit filed last month by five former cheerleaders that contained some fairly sensational allegations. Dennis Vacco, a former state attorney general and partner with Buffalo’s Lippes Mathias Wexler Friedman, is advising the team’s cheerleading production company in the suit, a similar version of which was also filed this week against the NFL’s New York Jets, according to sibling publication the New Jersey Law Journal.
—Several big firms are advising on two notable sports-related sales in recent weeks. DLA and Covington are counseling Kamylon Capital on its sale for an undisclosed sum of archery accessory portfolio company FeraDyne Outdoors to private equity firm Snow Phipps Group, while Wachtell, Lipton, Rosen & Katz is representing Columbia Sportswear on its $190 million purchase of yoga gear maker PrAna Living, which is being advised by Squire Sanders.