How to Get Rid of an NBA Owner

 

“I want to make it clear that I’m not going to punish [Rodman] for what he does off the court.  I’m going to let the media crucify him for that… This is still America, and my jurisdiction is still the basketball court.”  — David Stern, 1997

In case you missed the meat of what the NBA decided to do to Donald Sterling yesterday, this is Commissioner Adam Silver from the transcript:

I am banning Mr. Sterling for life from any association with the Clippers organization or the NBA. Mr. Sterling may not attend any NBA games or practices. He may not be present at any Clippers facility, and he may not participate in any business or player personnel decisions involving the team. He will also be barred from attending NBA Board of Governors meetings or participating in any other league activity.

I am also fining Mr. Sterling $2.5 million, the maximum amount allowed under the NBA constitution. These funds will be donated to organizations dedicated to anti-discrimination and tolerance efforts that will be jointly selected by the NBA and its Players Association.

As for Mr. Sterling’s ownership interest in the Clippers, I will urge the Board of Governors to exercise its authority to force a sale of the team and will do everything in my power to ensure that that happens.

I was vaguely aware of the NBA Constitution, but it had never been published anywhere before yesterday. It certainly does give the commissioner the right to fine an owner. This isn’t even the largest fine that’s been levied — the ownership of the Minnesota Timberwolves was hit for $3.5 million for violating league rules in signing free agent Joe Smith. And the NBA has fined numerous players for conduct unbecoming or detrimental to the league (Dennis Rodman’s sin in the 1997 NBA Finals was to say Mormons in Utah had put him “out of sync” — the quote includes a modifier for the noun Mormons that I’m not allowed to use. He was fined $50,000, but not suspended; it was, after all, the Finals.)

The fine will stand, though it wouldn’t have been enough of a punishment on its own given the gravity of the situation. The lifetime ban is severe, but not without precedent in other leagues. The NBA has used it as well, banning Roy Tarpley for substance abuse in 1995, and exiling Connie Hawkins and Ralph Beard for point shaving back in the dark ages.  

But force an owner to sell? There are only two precedents I could recall. Marge Schott is the one people remember, forced to sell Major League Baseball’s Cincinnati Reds after suggesting that Hitler just got carried away and wasn’t such a bad guy. The other is Eddie DeBartolo, whose fraud conviction eventually led to a suspension from the NFL and giving up control of the San Francisco 49ers to his sister. He did so under duress from the league and has since expressed regret that he gave in.

Those cases have two crucial differences from Sterling. Major League Baseball has a full antitrust exemption, so the other owners could simply tell Schott that they wouldn’t schedule games against the Reds if she didn’t give up the team. The NBA doesn’t have that kind of protection, and 29 owners conspiring against one other owner is very suspect (Ask Al Davis). Meanwhile, DeBartolo committed a federal crime and pled guilty (he paid a $1 million fine and was subject to two years of probation for a bribe in Louisiana.)

No such case exists with Sterling; what he said was disgusting but not illegal. Still, there’s that constitution, which says in Article 35A, section (d):

The Commissioner shall have the power to suspend for a definite or indefinite period, or to impose a fine not exceeding $1,000,000, or inflict both such suspension and fine upon any person who, in his opinion, shall have been guilty of conduct prejudicial or detrimental to the Association.

I still haven’t figured out the $2.5 million part, but the lifetime ban appears to be “suspend for an indefinite period.” I doubt there will be much argument over the $2.5 million.

Can the NBA do to Sterling what MLB did to Schott and what DeBartolo agreed to do with the NFL?  There will be buyers lining up (the Wall Street Journal reports tonight that David Geffen is interested) and the team Sterling bought for $12.5 million in 1981 will sell for well more than the $535 million it was last valued at by Forbes. But Sterling could decide to fight the revocation of his membership in the league and perhaps restraint of trade.  

What makes this so interesting is that NBA Commissioner Adam Silver only recently replaced David Stern. The latter was considered the most powerful sports commissioner in the world, long criticized for overstepping his authority with players. He had no problem picking new owners, pressuring old ones to sell (George Shinn in New Orleans being the best example) and generally making everyone follow his vision of the Association. And it worked; the league grew and made more money, so owners accepted his excesses as the price of getting those enormous television contracts and lucrative licensing fees. Silver doesn’t have that kind of reputation yet, and if Sterling decides to send the lawyers after him to test his mettle, it will be interesting to watch whether the other 29 owners will be there to write the checks to pay for the defense.  

There are 22 comments.

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  1. TeeGee Inactive
    TeeGee
    @TeeGee

    I must confess to something here. Of course what Sterling said was disgusting. (Can I call him a typical supporter of the Democratic Party?)
    But somehow I find my back gets up whenever the media–particularly the sports media–gets their self-righteous on.

    • #1
  2. Misthiocracy Member
    Misthiocracy
    @Misthiocracy

    TeeGee: Can I call him a typical supporter of the Democratic Party?

    The Smoking Gun says he’s a registered Republican:

    http://www.thesmokinggun.com/buster/Donald-Sterling-registered-republican-465241

    • #2
  3. Eric Hines Inactive
    Eric Hines
    @EricHines

    Part I: I’m not that bothered by Silver’s encouraging the BoG to recommend the owners force Sterling to sell.  Nor would I be bothered by the owners then forcing the sale.

    I don’t know the fine details of Sherman, as bastardized by Clayton.  My speculative view, though, is that there is no antitrust problem, even though Sterling certainly could drag things out for a few years.  The reason I think a forced sale would stand up in the courts centers on the revenue sharing aspect of the NBA: to a large extent the game revenues flowing from every game are pooled and shared out among all the owners (and their teams), regardless of the source game.  This gives all the owners a measure of property in every other team.  They’d simply be protecting their property by tossing one of their associates.

    And, where’s the harm to Sterling from the forced sale?  Certainly, there’s harm from his being forced to give up his own property.  But he’ll also make a handsome profit from the sale; financial mechanisms are a venerable mechanism for making folks whole from their losses.

    Eric Hines

    • #3
  4. Eric Hines Inactive
    Eric Hines
    @EricHines

    Part II: An interesting case could be made here, though, that no, he can’t sue the league to prevent their forcing him to sell.  The lifetime ban includes this, which seems beyond challenge in the nature of “ban:”

    he may not participate in any business or player personnel decisions involving the team. He will also be barred from attending NBA Board of Governors meetings or participating in any other league activity.

    I think it could be argued that a suit to preserve his ownership would be a violation of the bans on “business involving the team” (vis., he can’t sell it–that’s business involving, and he’s banned from that) and on “participating in any other league activity” (the suit would be a league activity…). 

    Of course, there’s that whole right of access to the courts for redress thing….

    Eric Hines

    • #4
  5. MarciN Member
    MarciN
    @MarciN

    Misthiocracy:

    TeeGee: Can I call him a typical supporter of the Democratic Party?

    The Smoking Gun says he’s a registered Republican:

    http://www.thesmokinggun.com/buster/Donald-Sterling-registered-republican-465241

     The worst news I have heard in a long time.  Ugh.  

    • #5
  6. mask Inactive
    mask
    @mask

    Misthiocracy:

    TeeGee: Can I call him a typical supporter of the Democratic Party?

    The Smoking Gun says he’s a registered Republican:

    http://www.thesmokinggun.com/buster/Donald-Sterling-registered-republican-465241

     Whose only real political donations have been to Democrats.
    He also has a history of discrimination against minorities in his real estate developments.
    So apparently you can do racist things in public but cannot speak racist things in private.

    • #6
  7. mask Inactive
    mask
    @mask

    And like any sports league there are a number of convicted and accused criminals in the player base who have gone unpunished by the league or very lightly so.

    If the NBA was really concerned about it’s image then aren’t the players more of an issue than an owner?  A casual fan will know who the players are but have no idea who the owner is.

    Seems like a big double standard.

    • #7
  8. user_6236 Member
    user_6236
    @JimChase

    Question, yes, there is a process for terminating an ownership (Articles 13 and 14) in the NBA constitution.  But Article 13 lists specific acts that may result in the BoG initiating termination proceedings.  I don’t see where Sterling’s offense fits in the list provided, even in the abstract.  Surely that’s problematic from a legal angle?

    • #8
  9. Ryan M Member
    Ryan M
    @RyanM

    TeeGee:

    I must confess to something here. Of course what Sterling said was disgusting.

    …I find my back gets up whenever the media–particularly the sports media–gets their self_righteous on.

     I totally agree.  I’d like to see Sterling fight it and win.  Frankly, I don’t care whether what he said was disgusting or not.  I don’t know the man.  I’m not offended, and I don’t think anyone else should be – even black people.  It’s rude, but no more rude than half of what Al Sharpton says on a daily basis, no more rude than Oprah Winfrey having a panel of black men on her show to discuss how they feel betrayed when a black woman dates a white man.  This double standard is ridiculous.  We pile on for the same reason we recycle, for the same reason we knee-jerkedly throw out the obligatory “well of course it’s awful,” or “of course I don’t believe that,” or any other blanket recognition of victimhood… He might be a jerk; he might be a great guy whose words were twisted out of context.  Either way, these endless PC crucifixions need to stop.

    • #9
  10. Jon Gabriel, Ed. Admin
    Jon Gabriel, Ed.
    @jon

    The NBA might be able to take away Sterling’s team, but they can never take away his good looks and personal charm.

    BmbAjQ6CQAAnjUH

    • #10
  11. PHCheese Inactive
    PHCheese
    @PHCheese

    Has anyone here at Ricochet read about events during the Cultural Revolution in China?

    • #11
  12. thelonious Member
    thelonious
    @thelonious

    Sterling added nothing to the NBA.  I would even say he was a stain on the NBA.   He was a notorious cheapskate who hardly tried to put a winning team on the court.  David Stern tried to get him to sell the team and it’s obvious the other owners don’t respect him.   If Sterling was a well respected owner I’m sure he would have received more leniency.  30 plus years of apathy and mediocrity have come home to roost.

    • #12
  13. Freesmith Inactive
    Freesmith
    @Freesmith

    PHCheese

    Yes. That was the party apparatus of the government clique using state-sanctioned violence to enforce group-think and suppress all dissent of the ruling clique.

    “Let a thousand flowers bloom,” said Mao cynically. When those flowers began innocently to blossom Mao’s friends used the opportunity to find them and pluck them.

    I don’t see much connection here.

    • #13
  14. PHCheese Inactive
    PHCheese
    @PHCheese

    Freesmith:

    PHCheese

    Yes. That was the party apparatus of the government clique using state-sanctioned violence to enforce group-think and suppress all dissent of the ruling clique.

    “Let a thousand flowers bloom,” said Mao cynically. When those flowers began innocently to blossom Mao’s friends used the opportunity to find them and pluck them.

    I don’t see much connection here.

     Keep watching.

    • #14
  15. EThompson Inactive
    EThompson
    @EThompson

    The PC police have now taken their boldest swipe yet at liberty and the free market and won. As absurd as Sterling’s remarks may have been, I find it terrifying that any institution has been anointed with the power to rob an individual of his business. Hopefully the more financially astute players in the league will help to nip this one in the bud. I am relying on pure self-interest to save the day.

    • #15
  16. King Banaian Contributor
    King Banaian
    @KingBanaian

    Jim Chase:

    Question, yes, there is a process for terminating an ownership (Articles 13 and 14) in the NBA constitution. But Article 13 lists specific acts that may result in the BoG initiating termination proceedings. I don’t see where Sterling’s offense fits in the list provided, even in the abstract. Surely that’s problematic from a legal angle?

     And I do believe this is the key question.  Please note to start, I am not a lawyer but an economist who teaches sports econ; you have to read a lot of contracts and antitrust cases to do so. 

    A private organization may sanction one of its members in a variety of ways for “conduct detrimental.”  Article 13 (the post was already too long for me to talk about this) seems to limit the board’s ability to remove an owner.  Article 14 gives the process to be followed if an owner or member is found in violation of Article 13.  No other part of the Constitution, including Article 35A (which we can agree Sterling violated), should be able to give rise to the Article 14 termination process.  So it does seem to me they are going to have to invent precedent here to get rid of Sterling.  I have no doubt they will. 

    By the way, Article 14A is used if one is found guilty under Article 14.  It puts the franchise in receivership controlled by the Commissioner, and proceeds from the sale are to repay debts first before remitting the balance to the expelled owner.  As you can see, the language is created for removing a destitute owner unable to finance his team, not a corrupt or immoral one.  And Article 15 could be used to allow Sterling to keep the team but impose some larger financial penalty, if 2/3rds of owners vote to do that.  I doubt they take this route.

    • #16
  17. user_989419 Inactive
    user_989419
    @ProbableCause

    “These funds will be donated to organizations dedicated to anti-discrimination and tolerance efforts that will be jointly selected by the NBA and its Players Association.”

    I wonder which organizations those will be.  GLAAD?  NAACP?  Sharpton, Inc.?  Is Jesse Jackson’s Raindbow/PUSH Coalition still around?

    Please let it be the United Negro College Fund.  Or (fantasizing now), the Black Alliance for Educational Options.

    • #17
  18. Freesmith Inactive
    Freesmith
    @Freesmith

    PHCheese

    “Keep watching.”

    I will. You too. Let me know when the government gets involved. 

    Also, although our ruling clique is constantly exhorting Americans to have a “conversation” about race, I don’t think that was the catalyst for Sterling’s remarks.

    • #18
  19. PHCheese Inactive
    PHCheese
    @PHCheese

    Freesmith:

    PHCheese

    “Keep watching.”

    I will. You too. Let me know when the government gets involved.

    Also, although our ruling clique is constantly exhorting Americans to have a “conversation” about race, I don’t think that was the catalyst for Sterling’s remarks.

     No ,I don’t suggest that was the catalyst for Sterling’s remarks, Its the reaction to his remarks I liken to the Cultural Revolution.

    • #19

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