Whatever legal tactics Donald Sterling or his estranged wife, Shelly Sterling, might have up their sleeves, one thing is certain: the National Basketball Association is moving forward with proceedings that could force him to sell the Los Angeles Clippers.
The NBA is planning to hold a hearing on June 3, after which NBA owners could demand the team be sold, according to news reports and statements from the NBA.
On May 19, the NBA said Sterling damaged the league and its marketing partners as a result of his racist rant leaked to TMZ and additional public statements. So far, Sterling has been banned for life and was ordered to pay a $2.5 million fine.
Still, the NBA is aware there could be legal challenges to any decision the owners make.
“This is an unprecedented proceeding. Will there be bumps in the road? Presumably yes,” NBA Commissioner Adam Silver said in a statement to the media. “Mr. Sterling, on one hand, at least in his CNN interview, indicated a willingness to accept the judgment of his owner partners. His lawyers are saying otherwise, so we’ll see.”
By next week, Sterling needs to respond to the NBA owners and he may appear at the June 3 hearing. If the NBA moves forward with the forced sale, three quarters of the owners will have to approve it, which would mean Donald Sterling nor Shelly Sterling would likely remain as owners unless the move can be blocked in court.
Recently, Donald Sterling’s attorney asked that a three-month delay be granted in the proceedings. The NBA is likely to refuse.
Also, a lawyer representing Shelly Sterling claims she should keep 50 percent of the franchise, whatever happens with her husband’s share.
Yet, the NBA has said, “If the NBA Board of Governors sustains the charge, the ownership interests of Mr. and Mrs. Sterling in the Clippers will be terminated.”
On May 19, Donald Sterling and his new lawyer, Maxwell Blecher, a well-known antitrust specialist, were given a document outlining the league’s charges and allegations. By May 27, Sterling needs to respond to the charges. He could be terminated as an owner if he chooses not to respond.
During the June 3 hearing, Glen Taylor, the chairman of the league’s Board of Governors and owner of the Minnesota Timberwolves, will preside.
June 3 is two days before the start of the NBA Finals. That fact is of interest to Robert Boland, a sports law specialist who teaches at New York University. He points out in an interview Tuesday with InsideCounsel that just a few players in a final game could take a stand against Sterling and refuse to play.
One key issue for the owners is whether they have done enough to satisfy the players’ concerns, and thus avoid any work stoppage, Boland said.
“The players could use this to their advantage,” Boland added. “The NBA wants to make sure this isn’t that opportunity.”
He adds that the NBA is under pressure “morally” in the situation, as well as on a more practical level regarding collective bargaining.
“They need to move forward,” Boland said about the owners.
In making their case against Sterling, the NBA owners claim, “As evidenced by the recording made public on April 26, 2014, and by a subsequent media interview, Donald Sterling has taken discriminatory actions and supported discriminatory positions that have had (and will continue to have) a material adverse impact on the NBA and its teams. Among other things, Mr. Sterling: disparaged African-Americans and ‘minorities’; denigrated the contribution of NBA players; directed a female acquaintance not to associate publicly with African-Americans; admonished that acquaintance for posting pictures of herself with African-Americans on social media; directed that acquaintance not to bring African-Americans to Clippers games; and criticized African-Americans for not supporting their communities.”
The NBA said in a statement that as a result of his actions, they “significantly undermine and call into question the NBA’s commitment to diversity and inclusion; damage the NBA’s relationship with its fans; harm NBA owners, players and Clippers team personnel; and impair the NBA’s relationship with marketing partners and licensees, as well as with government and community leaders.”
The league also charged relevant evidence was destroyed, and “false and misleading evidence was provided to the NBA’s investigator.”
Under the NBA Constitution, an NBA membership can be terminated if a “member or owner fails or refuses to fulfill its contractual obligations to the Association, its Members, Players, or any other third party in such a way as to affect the Association or its Members adversely.”
It was also announced that Sterling said, via his attorney, he will not pay the fine, because it violates his due process. In fact, Sterling should not get “any punishment at all,” according to a letter sent by Blecher to the NBA, news reports said.
“We have just received the voluminous charges and are beginning the process of carefully reviewing them,” Shelly Sterling’s lawyer, Pierce O’Donnell, added in a statement made to the media this week. “Based on our initial assessment, we continue to believe there is no lawful basis for stripping Shelly Sterling of her 50 percent ownership interest in the Clippers. She is the innocent estranged spouse. We also continue to hope that we can resolve this dispute with the NBA for the good of all constituencies.”
But in its statement, the NBA said, “Termination of LAC’s [which owns the Los Angeles Clippers] entire membership – including Mrs. Sterling’s interest in the team – is called for by the Constitution and related agreements and is the only viable means for bringing Mr. Sterling’s interest in the Clippers to an end.”
The Los Angeles Times reported, too, that Manatt, Phelps & Phillips will no longer represent Sterling and Shelly Sterling “because of the couple’s diverging interests from each other and from the team that is now being run day-to-day by Chief Executive Dick Parsons, who was appointed by the NBA.”
Partner Robert Platt is still chief counsel for the Clippers, but is “no longer a representative of the longtime owners,” The Times report added.