How Stern Exacerbated the Sterling Saga

chris-paul-sternHey LakHer fans! Hope you didn’t miss me too much!  I am back after letting “legal expert” Adam Waks take over for a few days. The Sterling debacle has lead to a lot of discussion and debate. It has stirred up a lot of emotions for everyone who has been touched by this story.

Adam covered some of the legal issues surrounding this saga in the last few days, but now I want to look back a bit further. People have been criticizing the NBA for failing to take action against Donald Sterling sooner. There have been accusations for years: between the DOJ settlement and the Elgin Baylor termination lawsuit. People want to know why the NBA didn’t take action in those cases. Well, without going too deep into the legal issues (since I like to leave those to Adam), I can say that they probably did not have a choice.

The DOJ case was settled, and that does not necessarily mean Sterling was guilty. Of course, we now can all believe that Sterling was guilty, but people settle for various reasons. He may have thought it was cheaper to settle than fight, certain pieces of evidence brought up at trial could have tarnished his reputation, or he simply did not want to deal with the negative publicity. During his press conference, Silver explained that every allegation was investigated; unfortunately, once the case was settled, their investigation probably ended as well.

The same goes for Elgin Baylor. I will always have faith in my Laker, but he lost his case in court. Sterling was given due process, so the NBA was cornered. The NBA cannot punish Sterling on Baylor’s word alone, especially once the courts ruled in Sterling’s favor. My fans may be unhappy with this view, but since I come from a family of lawyers (sorry Grandma Barbara), I must respect the process.

Of course, there have been other allegations over the years. Baron Davis accused Sterling of heckling him during practice. I have no idea if those allegations were investigated. However, it is public knowledge that NBA have tried to convince Sterling to sell in the past, therefore it would make sense that they would try to get as much ammunition as possible to entice him to sell.

Now, here is where there is a wrinkle in the story. In December 2011, David Stern forever tainted his reputation as commissioner by vetoing the Chis Paul trade to the Lakers. Stern let owners like Dan Gilbert bully him into overturning a trade. There was no legitimate reason for this veto; the owners were simply tired of the Lakers getting superstars.

There is a reason why the Lakers attract superstars. We had a wonderful owner in Dr. Buss, we are located in beautiful Los Angeles, and we are one of the most successful franchises in history.

Owners can bemoan all they want, but we are a great organization. However, that year David Stern had the power to veto a trade made by the Hornets. It is ironic that I am complaining about how Stern took over a team from an owner, but I am rejoicing in Silver doing the exact same thing to Sterling. Believe me, I see it.

However, this move was catastrophic for everyone. First off, we ended up with two unhappy all stars, and eventually had to trade Lamar Odom for draft picks. Those draft picks eventually led to the acquisition of Steve Nash (see this whole veto is still biting us in the ass).

Next, and more importantly, Stern gave CP3 to Sterling on a silver platter. For 30 years the Clippers had been a punch line, but now they are contenders.

The acquisition of Chris Paul substantially increased the value of the Clippers. Sterling bought the Clippers for $12.5 million back in 1981. However, the Milwaukee Bucks were recently sold for a cool $550 million. The Bucks are a small market, unsuccessful team. This means that we can expect Sterling to make a huge profit by selling the team. Big offers will come in from the ever expanding list of interested celebrities. He will make a much more substantial profit now, then he would have if that trade had never been vetoed.





Sterling Sanctions: UPDATE

8gnboDue to popular demand and the surprising sanctions brought against Sterling, I have asked LakHer Blog’s favorite (and only) guest blogger to respond to the breaking news:


Hey LakHer Fans, this is a quick follow up for those of you who read my post yesterday on the NBA’s potential recourse against Donald Sterling. Update: Adam Silver (the NBA Commissioner) appears to have gone above and beyond my prediction by fining Sterling $2.5 million, banning him for life, and in the Commissioners own words “urge[ing] the Board of Governors to exercise its authority to force a sale of the team.”


First, I should point out that a lifetime ban appears to be different from an indefinite suspensions – the phrase “indefinite” implies that the suspension might be revoked at some point, while “ban” seems to suggest that there is no chance Sterling will be allowed to return to normal relations with the NBA ever again. This is a VERY serious sanction, and one that has not ever been employed by the NBA as far as I am aware.


Second, I want to emphasize that the devil is still in the details regarding the ban and the “urging” of a forced sale. Clearly, Adam Silver wanted to come out taking a strong stand on this issue, and I don’t think anyone at this point will accuse him of not acting to the extent of his authority. In fact, the general tenor is that he is imposing the absolute maximum penalty against Sterling – the fine is large, the suspension is actually a ban, and the forced sale is something he claims he will actively encourage. However, as I discussed yesterday, what a suspension (or a ban) actually means for an owner is not clear, and the NBA still needs to hash out those details – Silver said Sterling is banned from attending NBA games, practices, and Board of Governors meetings, but it is still unclear what impact, if any, the ban will have on Sterling’s ability to manage the Clippers as a team, or if the NBA intends to take over management duties.


Silver’s intent to “urge” the Board of Governors to exercise its authority to force Sterling to sell the team is equally slippery. For one, per my post yesterday, we are not 100% sure exactly what authority the Board of Governors has to force a sale – the NBA constitution is not a public document, and the main authority it seems to establish only applies in cases of owner bankruptcy / inability to pay the teams bills. I am reading now that there is also a provision in the constitution that would “allow[] for termination of franchise ownership when an owner ‘fails to fulfill’ a ‘contractual obligation’ in ‘such a way as to affect the [NBA] or its members adversely.’” That kind of language is a lawyers DREAM – basically every word in that entire clause is devoid of singular meaning and open to litigation. Silver might “urge” all he wants, but a reasonable board of governors will have a hard time pulling the trigger with that sort of litigation potential hanging over their heads.


I’m not making these points to suggest that Silver is being underhanded or is not taking a strong stance on this issue – in fact I am honestly surprised at how serious these sanctions are. I’m simply pointing out that we are going to need to wait a little longer to find out EXACTLY what these sanctions mean. Furthermore, I still think the most likely outcome will be all the other NBA owners working behind-the-scenes to convince Sterling that a sale is in his best interest, while courting a third party to come in and purchase the team for a price that reflects the teams pre-scandal value.


*Adam Waks is a student at the New York University School of Law – he is not actually an expert in any legal field, nor is he licensed to practice law in any state as of April 29th, 2014. He is however a lifetime Laker fan, and the kind of brother willing to spend 4 hours reading sports blogs instead of studying for his law school finals.

What Legal Recourse Does the NBA Have Against Donald Sterling?

anchormanwhatdidyousayI have been hearing from a lot of my loyal fans about the legal issues currently facing Clippers owner Donald Sterling. Although I am passingly familiar with the law, I thought it would be helpful to get an expert* to weigh in on the topic. To that end, here is my brother, for a first-ever guest post!

Hello LakHer fans! I’m very excited to have this opportunity to speak to you directly on several topics near and dear to my heart – basketball, legal analysis, and inappropriate comments from an employer! Actually, this article will focus on a somewhat narrow topic that has been generating a lot of commentary since TMZ released Donald Sterling’s remarks last week: assuming the comments are confirmed as Sterling’s, what legal tools does the NBA possess to punish Mr. Sterling for what is widely viewed as reprehensible conduct?

The short answer is that the NBA has three general tools: they can fine him, they can suspend him, and they can try and force him to sell the team. However, having a tool is not the same thing as being willing to use it, and for reasons I will explain in more detail below, I think the likely outcome is that the NBA will fine Sterling, and they will more than likely suspend him, but they will not force him to sell.

Initial Issues

The First Amendment: This is actually a non-issue, but I have heard several questions on the subject and it is a personal pet peeve of mine, so I want to put any concerns regarding freedom of speech to bed before we get to the real issues. The questions on this topic generally sound something like “how can the NBA punish Donald Sterling for speaking his mind? What ever happened to freedom of speech and the first amendment?” The answer is simple: the first amendment (go read the text here for yourself) protects individuals from GOVERNMENT infringement on speech. Basically, there is no such thing as a constitutional right to free speech – there is a constitutional right not to have the government infringe on your speech. Private parties in private dealings can infringe on each other’s speech all day long without running afoul of the constitution, subject of course to other laws not relevant in this case.

The NBA’s Constitution: Yes, the NBA has its own constitution, but it is not a public document, so knowledge of what it actually contains is limited. The ever-savvy media has been able to learn much of the contents of the document either from leaked sources or from inferences based on actions the NBA has taken in the past (ie. we know that the NBA constitution says the NBA can fine coaches and players because we have seen them do it without legal challenge). However, as the document itself has not been released for public consumption, the nitty gritty little details that are OH SO important for good legal analysis remain un-scrutinized by outsiders like yours truly. As a result, some portion of the following analysis is speculative, albeit based on information generally agreed on by the commentariat.

The Fine

Fines are commonly used by leagues like the NBA to punish players, coaches, and owners for poor conduct both on and off the court. Mark Cuban is the posterboy for NBA owner fines, having reportedly paid over $1.5 million in fines to date during his tenure as owner of the Dallas Mavericks. The record for the single largest fine in NBA history also belongs to Mr. Cuban, who in 2002 was required to pay $500,000 for complaining publicly about what he considered poor officiating regarding his star players.

As far as penalties go, fines generally work pretty well – they are hassle free, and the NBA constitution and by-laws clearly permit their use. The downside to fines, especially when it comes to team owners, is that even massive fines seem like a slap on the wrist. Sure, we can assume that if the NBA was willing to fine Mark Cuban half a million dollars for complaining about referees, they will be willing to fine Donald Sterling more than that for his alleged comments. But even assuming the NBA was willing to fine him, lets say, $5 million, Donald Sterling is reportedly worth almost $2 BILLION. As crazy as it is to say, to a guy like that $5 million is a rounding error. Furthermore, a $5 million fine would be 10 times more than the largest previous fine against an NBA owner – we may not know exactly what the NBA constitution says, but we can assume it has some limitations when it comes to fines, so in all likelihood it would be impossible for the NBA to fine Sterling an amount that would actually hurt his pocketbook and make fans happy.

The bottom line? If the comments are eventually attributed to Sterling the NBA will almost certainly fine him, but if a fine is all that happens people will not be pleased.

The Suspension

I feel fairly confident that if action is taken against Sterling it will include a suspension. Suspension of an owner, though rare, does happen: our own Jerry Buss was suspended in 2007 as a result of a drunk-driving conviction, and Glen Taylor of the Timberwolves was suspended for an entire season for messing around with salary caps when signing a free-agent. The public generally seems to react positively to suspensions – suspensions sound punitive, and we like the idea of people being “removed” from whatever they were doing as punishment.

However, it is fairly unclear to me what a suspension of an owner actually MEANS, practically speaking. If you are a player and you get suspended, you don’t get to play and you don’t get paid. Same thing goes if you are a coach. The problem is, owners don’t really “work” the same way – they don’t play games, and they usually don’t take a salary (or if they do it is a token amount) because their real investment is the equity value of the team. So, what would a Sterling suspension actually do? It might mean that he can’t participate in management activity (although he is literally an octogenarian, and it is debatable how involved he is in day-to-day) and it might mean that he can’t attend games (although if I was him I wouldn’t feel comfortable stepping into Staples right now without an army of bodyguards at my side anyway). When all is said and done though, he still owns the team, and at the end of the day isn’t that what being an owner is all about? A suspension might be a good solution in terms of making fans happy, but it’s hard to imagine that it will be an effective punishment for Sterling.

The Forced Sale

First, lets get a few definitional issues out of the way. A lot of people are wondering how the NBA could force Sterling to sell the Clippers – after all, if he owns the team, how can someone else force him to sell his property? The answer is that owning an NBA team isn’t like owning a computer or a cell phone – the team is not Sterling’s to do with as he will – the team is a franchise property.

To use fast food as an example, if I wanted to open a franchise of a hamburger restaurant (lets say for the purposes of avoiding any trademark issues that I wanted to open a McKobes) I would go to McKobes headquarters and sign a franchise agreement with them. Pursuant to this agreement, I would be required to do certain things (for example, I would secure a lease on a property and I would decorate it according to the guidelines of my agreement) and they would be required to do certain things (for example, they would let me use their branding and agree to sell me McKobe burger patties). If either of us broke any of the promises we made in our franchise contract, the aggrieved party could sue the breaching party. While I am sure the franchise agreement between Sterling and the NBA is much more complicated than the one I just described, the main thrust is the same: Sterling and the NBA have each made a complicated set of promises to each-other, and each side has already agreed upon certain remedies the aggrieved side can seek in the event that the other side breaks those promises.

Here is where it gets tricky. According to sources, the NBA constitution does contain a clause allowing the NBA to force an owner to sell. However, according to these sources, the clause is only triggered in very specific circumstances, limited to serious financial issues (basically, when an owner is unable to pay the team’s bills). Clearly, paying bills is not a problem for Sterling (see massive fortune, above). Without seeing the actual constitution’s language, it is impossible to know if there are any ways a creative legal mind could apply the language to the situation at hand, but based on what people in the know are saying, it seems unlikely.

This is not to say that the NBA couldn’t try and force Sterling to sell by indirect means. For example, the NBA and the other owners could do everything in their power to make the NBA an uncomfortable place for Sterling to be, such as suspending him indefinitely (see above) taking over management of the team, and directly “encouraging” him to sell. However, I think this is an unlikely scenario for two reasons. First, Sterling started his career as a trial lawyer, and reportedly LOVES litigation. If the NBA really puts pressure on Sterling to sell absent a breach of his franchise contract or the NBA constitution or by-laws, he would have a potential anti-trust case, which would be costly for the league to defend and would eat up years and millions of dollars, not to mention make headlines every few months. Plus, if Sterling actually litigates to the end and wins, any damages would be tripled because of anti-trust laws. Second, I think the owners are always worried about setting precedent when it comes to something as drastic as forcing an owner to sell a team. Sure, what Sterling is accused of is pretty egregious, but the owners will clearly be concerned that once the door to this sort of action is opened, there is no turning back.


To sum it all up, if the comments are Sterling’s and are not somehow taken out of context, I feel confident Sterling will be fined, I feel pretty confident he will be suspended, and I feel absolutely confident he won’t be forced (directly or indirectly) to sell. However, he is also a shrewd businessman, and I think the most likely outcome is that a third party will come in looking to buy the Clippers for a fair price and Sterling will recognize that this as a good time to get out before things get too heated (or more heated then they already are). That being said, I don’t expect Sterling to sell at a discount, so unless a buyer comes offering a good value, I think Sterling will be happy to ride this wave and dare the NBA to do anything to him that will actually hit him where it hurts.


*Adam Waks is a student at the New York University School of Law – he is not actually an expert in any legal field, nor is he licensed to practice law in any state as of April 29th, 2014. He is however a lifetime Laker fan, and the kind of brother willing to spend 4 hours reading sports blogs instead of studying for his law school finals.

Caught RED Handed

10151268_10152444553402223_4222008795063878859_nEarlier this week red, white, and blue balloons were hung on the Lakers statues for the Clippers first game against the Golden State Warriors. I have waited to write about this because I was very angry, and didn’t want to say something I would regret later. I try to keep this blog classy for my mother.

I was so angry I was throwing around words like vandalism and desecration. While this act may not be at that level, it was distasteful. It was a form of gloating, and I do believe it did defile the statues on a level.

I have read articles about how there is no security around those statues because the people of LA would never dare to disrespect them. So, to whoever decided to put those balloons up, congratulations, you have reached a level that even the lowest of LA wouldn’t dare to stoop to. I am not sure who put those balloons up, whether it was the Clippers organization themselves, or if it was just a fan. Either way, I have decided to take the high road. I look at this act and take pity upon the Clippers. They may be in the playoffs, but we still rule the town. We have the 16 banners, 9 retired jerseys, and 4 statues. The Clippers have nothing.


If Sterling himself authorized those balloons, it would not surprise me. That man has been the epitome of distaste. It would also explain why karma bit him so hard in the ass today.

In case you are unaware, Sterling’s racism came to light again today with a recorded call obtained by TMZ.

In case you did not click on the link, here is the summary: Sterling yelled at his girlfriend for posting a picture on Instagram of her with Magic Johnson, said he didn’t want to be associated with black people, and said he did not want Magic or other black people attending his games.

Not only did Sterling piss off Lakers fans this week with those balloons, but now he has pissed off the African American community and probably Dodgers fans (Magic is an owner).

Sterling is facing an uphill battle in trying to overtake the Lakers, and now he goes and bans black people? Nice move.

Not only has he angered an entire community, but he has also put his ownership at stake. Adam Silver released a statement today saying that they are reviewing the tape to make sure it is Sterling and will then take appropriate action. The analysts of the TNT halftime show are already calling for a massive fine and suspension. I am not entirely sure what that means for an owner, so I will wait to see what his punishment ends up being.

Maybe Silver will try to take the Clippers away from Sterling like the MLB did to the McCourts a few years ago. Only time will tell. It does hurt his relationship with fans and players. Will Chris Paul want to keep playing for a racist, especially if the Lakers have the money to pick him up next year?

The Clippers players are furious. Some even reported that their families were pressuring them not to play tomorrow, and to take a stand. The players are going to play, but they have told reporters that they want Sterling gone.

I have never been a fan of Donald Sterling. He has been accused to racism when it comes to his tenants and our beloved Elgin Baylor. In the past Donald has been able to buy his way out of trouble. Let’s hope that Adam Silver can finally take away his power and get him out of the NBA. Sorry Donald, karma is a real bitch.




The Battle of LALA Land

cartoons_kobe_bryant_-1280x800I was reading this article and immediately wanted to share it with my readers.

It discusses the new clash between Kobe fans and Lakers fans. It was an interesting perspective that I had never considered. It certainly explains why fans tend to fall into two groups when it comes to this new rebuild process. I particularly found this to be true after my post last week:

After I wrote this post I spoke to one of my fans who believes we should trade our pick for Kevin Love and try to win now. I clearly fall into the Lakers first camp by believing we should be cautious and take our time, but it appears that he applies to the Kobe before team way of thinking because he thinks trading for Kevin Love is worth the risk.

Now I want to my readers to brace themselves because I am about to do something shocking: compliment Jim Buss. When Kobe got his contract extension back in the fall, I will admit I was a bit surprised. I was surprised that the Lakers settled so quickly on such a high price. After taking a Negotiations class, I was even more surprised. Time was on the organizations’ side. It appeared to be within their best interest to drag it out because they had more to bargain with: Kobe has repeatedly said he wants to retire with the Lakers, Kobe was still injured, Kobe is old, and the CBA makes it difficult to pay high prices for players and be competitive. These were all elements the Lakers could use to drive down the price. Instead, the negotiated very quickly and on a very high price.

Unlike most fans, I did not blame Kobe; I blamed the organization. Honestly, who would turn down $50 million? Would you? Instead I put the blame on the organization for not either pushing harder, or deciding to wait. Now, here is where I compliment Jim Buss.

I think Jim Buss actually was using good foresight when he signed Kobe so early. Maybe he realized that this season was going to be a crap shoot and Kobe was going to lash out and complain anyway. Instead of allowing Kobe to be unattached for next year, Jim tied him into an expensive contract that no other team would touch. Now, even though Kobe is angry at the organization, he is stuck. This isn’t 2007. He is not at the prime of his career and no one is going to take him for $50 million now.

Kobe can complain all he wants, but once he signed that lavish deal, he gave up the only bargaining power that he had. Now Jim Buss holds the cards and can build the team however he desires, without the threat of Kobe walking away.

It is completely possible that I am giving Jim Buss way too much credit. Maybe this was all Mitch’s idea, or I am just reading too much into the situation. However, if I am right about those decisions, that would significantly increase my confidence in the ownership. I mean, he had to learn something from his father, right?