Posted on 05/16/2014 7:35:47 AM PDT by SeekAndFind
SI.com has learned that Clippers owner Donald Sterling has hired prominent antitrust litigator Maxwell Blecher, who has written a letter to NBA executive vice president and general counsel Rick Buchanan threatening to sue the NBA. The letter, sources tell SI.com, claims that Sterling has done nothing wrong and that "no punishment is warranted" for Sterling. Blecher also tells Buchanan that Sterling will not pay the $2.5 million fine, which is already past due. Blecher ends the letter by saying this controversy "will be adjudicated."
Blecher's letter makes clear what many have anticipated: Donald Sterling will not go down without a fight and that he is taking active steps toward litigation. A letter of this type is considered a precursor to the filing of a lawsuit. Blecher's letter offers no ambiguity about Sterling's intentions.
"We reject your demand for payment," the letter tells Buchanan, who on May 14 informed Sterling by letter that he must pay the $2.5 million fine.
Blecher's letter goes on to identify two basic legal defenses for Sterling.
First, Blecher claims that Sterling has not violated any article of the NBA constitution. The letter curiously references Article 35, which governs players' misconduct, and several other provisions. The NBA is expected to argue that Sterling violated Article 13(d) among other provisions. Article 13 (d) bars owners from violating contractual obligations, including the obligation that owners no engage in unethical conduct or take positions adverse to the NBA. Blecher does not explain how he intends to prove Sterling's racist remarks captured on the secret recording -- followed by Sterling's incendiary remarks to Anderson Cooper about Magic Johnson -- do not give rise to unethical conduct or positions adverse to the NBA.
(Excerpt) Read more at sportsillustrated.cnn.com ...
What specific NBA rule did Sterling violate?
He had transgressed the Unwritten Law.
One can not tell me Franchisees always lose.
Franchisee sues Corporate body, wins first round: http://articles.baltimoresun.com/1997-01-28/business/1997028003_1_mcdonald-payne-harvey
But everything you say would seem to say that the Franchisees are lost to begin with. Yes, and let me say I know this may be a different situation in the article but I’d still take a wait and see role here.
If his private conversation had remained private, it wouldn't have hurt business at all. The MSM is "hurting" the business by turning it into something of Holocaust proportions.
But it didn't remain private.
The NBA Commissioner is going to hurt business a lot more by dragging this through the courts.
Was there intent on his part to make it public?
and the comment wasn’t even racist, it was only perceived that way though the media
Acted in a manner contrary to what Silver believed was in the best interest of the Association. Article 24 (l): "Where a situation arises which is not covered in the Constitution and By-Laws, the Commissioner shall have the authority to make such decision,including the imposition of a penalty, as in his judgment shall be in the best interests of the Association. The penalty that may be assessed under the preceding two sentences may include, without limitation, a fine, suspension, and/or the forfeiture or assignment of draft choices. No monetary penalty fixed under this provision shall exceed $2,500,000."
That would depend on your point of view. One person's straight-shooter is another person's racist slob. But regardless, Sterling isn't being banned for being a racist jerk. Or only because of it. His idiotic comments caused a rift with the players, resulted in sponsors walking out, and could have cost the league millions in lost revenues had the playoffs been cancelled. He's being banned because in Silver's opinion placating the players and smoothing things over with the sponsors required it, and it was in the best interest of the NBA to do so.
They do have the right to fine him according to Article 24 (1) but I didn’t see anything in there that gives them a right to confiscate his team out from under him.
Magic Johnson paid a hooker to undermine Donald Sterling who was to stupid to see what was coming.
Exactly. It can't be Sterling's fault that his remarks garnered lots of attention. Silver had the universe of options available to him, and chose the most aggressive one. Rather than tone down the rhetoric and emotions, he ratcheted them up. He picked the stakes too, and set them at the house limit! Max fine and kick you out for life.
I don't think the incident has an effect on the NBA as a business, other than the cash diverted to legal offense and defense. The players play, the press makes it exciting, and the sports franchise goes on.
I haven't looked at reports of franchise income, ticket sales, etc. I highly doubt Silver can show a cause-effect linkage between Sterling's remarks and any loss to the NBA, because there hasn't been any financial loss!!
Doesn't matter. It doesn't even matter if it turns out that releasing the tape was illegal and his bimbo goes to jail as a result. The fact is that Sterling's comments did get out, they caused an uproar, and Silver decided the only way to prevent damage to the league was to ban and fine him. And Silver was within his authority to do so. We can argue all day whether it was fair or not, or whether the punishment fit the crime. But life isn't always fair, and Sterling agreed to the NBA Constitution and bylaws.
Every one of these contracts has some variation of “conduct unbecoming”. Making the main corporate body look bad is always against the rules.
I never said the franchisees always lose. Though that is a complete inverse of the situation Sterling is in. In that suit he’s claiming that corporate is driving down the value of the logo. That’s going to be the NBA’s defense if Sterling actually sues.
He should blow up the arena and fire all the players.
Why not?
All he did was to tell his supposed GF not to embarrass him (make him jealous) by bringing her other misters to the games.
If the bylaws specifically spell out what sorts of things he can demand of his mistresses, then by all means... I'm completely in agreement that he is in violation.
Otherwise, things get a little less black and white.
RE: The only person in all this who says anything about Sterling selling at less than market value is you.
I’m not saying he will sell it at a loss, but I’m talking PRINCIPLE, not what he would do IN PRACTICE.
Given that he does not own the franchise and the franchise does not want him associated with it, The effect is either to take the Clippers out of the NBA ( Which means A LOSS. who’s going to want to use or buy or watch your team when it is not part of the NBA?), or to SELL the team.
So the question is this — what if some financial wolf comes in and tells Sterling — “Hey, the NBA does not want you using their name with your team., and without the NBA name attached to your Clippers, your team is worth almost nothing. You have no choice but to sell it. Here’s X amount for the team ( where X is significantly lower than the market value had he not opened his big fat mouth.”
Can Sterling do a damn thing about it?
That's going to be the hard one. My predicition is that the owners will strip him of his team for show, knowing that Sterling will take it to court and probably win, but as a sop to the players. The hope is that they can drag it out long enough that dies in the interim and the heirs sell the team.
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