In the ongoing controversy surrounding the Kawhi Leonard endorsement scandal, Los Angeles Clippers owner Steve Ballmer has adopted a stance of "plausible deniability." Ballmer claims he was "duped," similar to other investors, when he invested $50 million into Aspiration, a green banking company. Aspiration had become a significant sponsor for the Clippers in 2021, contributing $300 million, but has since declared bankruptcy, with its CEO pleading guilty to fraud.
Ballmer has stated that the Clippers terminated their sponsorship agreement with Aspiration after the company defaulted on its obligations. He emphasized that neither he nor the team was aware of Leonard's substantial $48 million endorsement deal with Aspiration, which comprised $28 million in cash and the remainder in stock. In response to allegations that the Clippers exploited Leonard's endorsement to bypass the NBA salary cap, Ballmer firmly denied any wrongdoing, although skepticism regarding his claims is growing.
The narrative took a twist with revelations from the Pablo Torre Finds Out podcast, which initially broke the story. It was reported that Clippers minority owner Dennis Wong invested $2 million into Aspiration in late 2022, at a time when the company was struggling financially. Shortly after this investment, Leonard received a delayed $1.75 million endorsement payment. Additionally, new reports indicate that Ballmer made a second investment of nearly $10 million into Aspiration in March 2023, despite clear signs of the company's impending bankruptcy.
According to legal filings reviewed by The Athletic, Ballmer's 2023 investment was part of a fundraising round predominantly composed of existing investors, with Wong being the only new participant. Aspiration aimed to raise $75 million but fell short by nearly $9 million. Notably, it remains unclear when payments for Leonard’s endorsement ceased, and he is now listed as a creditor in Aspiration’s bankruptcy, seeking $7 million owed to him.
While Ballmer and the Clippers have yet to issue a statement regarding these latest allegations, their defense is expected to remain consistent. Ballmer argues that his investment was personal and not substantial relative to his estimated net worth of $153 billion. He maintains that it was an attempt to support the struggling company and recover his initial investment, asserting that these actions were unrelated to Leonard.
This situation has created a significant amount of circumstantial evidence suggesting that the Clippers may have used Aspiration to funnel additional funds to Leonard outside of his standard contract. The NBA Commissioner Adam Silver has indicated that the league’s investigation is focused on establishing a burden of proof, having enlisted a law firm to conduct an impartial inquiry. Silver expressed hesitation to act solely based on the appearance of impropriety, but the growing concerns among team owners suggest that more serious actions may be forthcoming.
As the NBA's formal investigation continues, the implications for the Clippers could be severe. Speculated consequences include the loss of future first-round draft picks, potential fines up to $7.5 million, suspensions for team executives, and the unlikely possibility of voiding Leonard's contract. With the investigation likely to extend over time, the pressure mounts on Ballmer and the Clippers as they navigate these serious allegations.
