Caught. Nabbed. Busted.

The Los Angeles Clippers spent the past year insisting they had nothing to fear from an NBA investigation into cap circumvention and that everything would be fine.

Everything was not fine.

A half-decade-old scheme to funnel extra money to forward Kawhi Leonard came to light through an investigative report by the “Pablo Torre Finds Out” podcast, and the Clippers got walloped for it.

First, the basics. After a yearlong investigation that culminated in a 35-page summary report from the law firm Wachtell, Lipton, Rosen & Katz, the league brought down the hammer on the Clippers on Wednesday.

For what it deemed were four instances of violating the league’s collective bargaining agreement by engaging in cap circumvention to fill Leonard’s pockets from 2020-22, the NBA stripped the Clippers of five first-round picks, fined the team $30 million, suspended team owner Steve Ballmer and the team’s president of business operations, Gillian Zucker, for a year and suspended the team’s president of basketball operations, Lawrence Frank, for six months. Leonard was required to pay the league $700,000 in unreimbursed expenses, and his agent at the time, Dennis Robertson (aka Uncle Dennis), was barred from the NBA for five years.

The Clippers have stuck to their story and vowed to keep fighting, but it is not clear how. There is no appeals process for this, and courts generally give leagues wide latitude to enforce their own rules.

What’s more, the information in the Wachtell report is damning, and the Clippers’ only attempt at a factual refutation has been to call it a witch hunt. Also, it was common knowledge in the NBA that Robertson was asking for improper side benefits in the summer of 2019, which Leonard then began receiving in 2020 before his next free agency, according to the report.

To say the burden of proof is now on the Clippers would be an understatement.

Regarding the lack of an appeals process, a clarification is in order. Article XIII, Section 3, of the collective bargaining agreement was initially misunderstood by some people, including me, to allow for a system arbitrator to hear a case before penalties for cap circumvention may be levied by the commissioner. But that applies only to penalties applied to a player, not to a team or management.

Because Leonard and the players’ union signed off on his repaying $700,000, there was no further process that would require an arbitrator. Leonard, who made tens of millions in off-the-books, no-show endorsements, made out like a bandit with this settlement, especially since his $51 million contract for the coming season was not voided.

The only relevant remaining section of Article XIII is the part that describes the penalties for cap circumvention. The menu that NBA Commissioner Adam Silver had to choose from included:

— Imposing a fine of up to $7.5 million.

— Directing the forfeiture of draft picks.

— Suspending any team personnel for up to one year.

It is notable that Silver chose to max out the potential penalties. While the fine is the least impactful part from a basketball perspective, it is notable because the league implemented the maximum financial penalty four times over because it found four violations.

Similarly, Ballmer and Zucker were suspended for a year because they could not be suspended any longer. Five first-round picks? There were only five that the Clippers owned free and clear.

The draft picks are from 2029 to 2033, partly because the Clippers already traded their 2028 first and swapped their 2027 pick. The Clippers’ 2029 swap with the Philadelphia 76ers is unaffected, as the penalty from the league cost them their 2029 pick from the Indiana Pacers instead.

Since the Clippers are still fighting in the court of public opinion, let’s make one thing clear: I believe virtually anyone who has worked in the league will agree that the Wachtell report absolutely hammered them. The document shows a systematic process that yielded four different counts of circumvention.

The report starts by outlining how the league browbeats front offices with memos about cap circumvention and what qualifies, which is absolutely correct. You would have to be obtuse to work in an NBA front office for any length of time and not understand the rules on this — especially as a player-facing front office executive, and especially an executive for a team previously found guilty of a fishy side-deal violation (during DeAndre Jordan’s 2015 free agency, for which the Clippers were fined $250,000).

Later in the document, we get to some of the meat of the cap circumvention.

According to contemporaneous notes kept by Frank, Robertson complained to Ballmer that Zucker was making introductions for deals but that he could not wait on her. “I have to get paid,” he told Ballmer. Ballmer responded by telling Robertson that he and Clippers personnel were all “collective workers to try to help (Leonard) achieve his financial goals,” and Zucker assured Robertson that Ballmer would “follow through on his promise.” Robertson requested a three- to six-month plan for more lucrative introductions from the Clippers, a list of five to six companies in the pipeline for “potential introductions,” and more frequent and consistent communication from Zucker.

Those who know Frank had to at least chortle in recognition, because he might be the league’s most scrupulous note taker. Bad beat for the Clippers there. But it’s also the key exchange that sets up everything the report goes on to document. Also, the second Robertson started pushing for improper benefits, the Clippers were required to notify the league, and they didn’t. It’s all downhill from there.

By Page 15, we are already dripping in sarcasm, thanks to the mountain of circumstantial evidence towering over the Clippers’ case — in particular, the team’s cover story for how the endorsements got off the ground: Investigators do not credit the suggestion in the “introduction” emails that each of these companies in fact requested to be introduced to Mr. Leonard within six days of each other, in the midst of the Covid-19 pandemic, and while the N.B.A. season was suspended.

One factor in the harsh penalty for the Clippers seems to be that their cooperation and truthfulness seemed, based on the Wachtell report, something short of optimal. The report asserts that Zucker was not truthful and danced around the same accusation regarding Ballmer. (The report’s introduction, in contrast, states Frank was forthcoming.)

Witness: In the Sept. 5, 2025, television interview referenced above, Mr. Ballmer said this in defending the Clippers’ conduct related to Aspiration: “[W]e even found the email that makes the first introduction. It was early November, I won’t remember the exact date. So where, where could any of this circumvention have happened? It didn’t. It couldn’t have. The introduction got made and then they were off to the races on their own. We weren’t involved.”

Mr. Ballmer and Ms. Zucker told investigators the same: that the Clippers’ sole involvement in Mr. Leonard’s relationship with Aspiration was an introductory email. Based on the foregoing evidence, investigators find these statements to be inaccurate (at best) with respect to Mr. Ballmer and clearly false with respect to Ms. Zucker.

Yikes.

From there, the report lays out how the four endorsement deals came to pass and follows the money back to the Clippers in each case, as well as tracking the timing of each and, as in the text above, noting the clear conflicts with the team’s cover story.

Silver had discretion in how to penalize these violations, and he hammered the Clippers. He had to. Twenty-nine other owners would have been furious if he hadn’t, especially with this much evidence. And Silver had to disincentivize this type of behavior in the future.

That’s because what’s done is done: The Clippers still got seven years of superstar play from Leonard (he did miss half the games, but still), and we have no idea if that would have happened if not for the assorted circumventions outlined here. All the teams they beat still took home a loss.

The Clippers’ price for signing Leonard was a simultaneous trade for Paul George that cost them five first-round picks, two swaps and Shai Gilgeous-Alexander. The shenanigans with Leonard and Uncle Dennis just cost them an additional five firsts.

Thus, while the Clippers in 2021 made the conference finals for the first and only time in franchise history, they effectively traded a two-time MVP and 10 firsts to win three playoff series in seven years — and were realistic contenders in only two of the seven.

Now what? It’s hard to believe given the team’s pre-Ballmer history, but the Clippers are working on a streak of 15 consecutive winning seasons. They might not have another for some time.

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This article originally appeared in The New York Times.

By John Hollinger / The Athletic
c. 2026 The New York Times Company