What Happened?

The NBA is investigating the Los Angeles Clippers and All-Star forward Kawhi Leonard over allegations they circumvented the league’s salary cap through a sponsorship deal with the now-bankrupt financial services company Aspiration.

We have the responsibility to demonstrate the irregularities and must examine all the evidence, not just appearance.– NBA Commissioner Adam Silver

ESPN reported that Leonard received a $28 million sponsorship from Aspiration in 2022, just months after signing a new contract with the Clippers. The deal allegedly allowed Leonard to avoid reaching the salary cap.

Who Are the Players Involved?

Clippers owner Steve Ballmer invested $50 million in Aspiration through his personal LLC in 2021 and, later, an additional $10 million in 2023. The team signed a multi-year deal with Aspiration making them the “first founding partner” of the Intuit Dome.

Joe Sanberg and Andrei Chery co-founded Aspiration in 2013, offering socially responsible and sustainable investment products. Sanberg, a businessman and former Clinton aide, admitted to defrauding Aspiration investors in 2023, facing up to 40 years in prison.

Aspiration’s Business Model and Partners

• Aspiration was a digital bank focused on environmental awareness, vowing to never finance fossil fuel projects.
• The company offered savings accounts, debit cards, business accounts, and fossil fuel-free investment funds.
• Renowned investors in Aspiration included Robert Downey Jr., Leonardo DiCaprio, and then-Milwaukee Bucks coach Doc Rivers.
• Other corporate partners included Metro, Microsoft, and the Los Angeles Clippers.

What’s Going On Now?

The NBA has hired the law firm Wachtell to investigate the alleged cap circumvention. Commissioner Adam Silver has emphasized the importance of conducting a thorough investigation and avoiding hasty conclusions.

Aspiration declared bankruptcy in March 2023, owing $170 million to creditors, including $30 million to the Clippers and $7 million to Leonard’s LLC.

Did Aspiration and Leonard Have a Valid Contract?

Cherny, Aspiration’s co-founder and former executive director, disputed claims the Leonard contract was a no-show deal. “It was a three-page contract filled with obligations,” he claimed in a social media statement.