A fresh development has emerged in the Kawhi Leonard controversy, and it paints a concerning picture for Steve Ballmer, the owner of the Los Angeles Clippers, and the team itself.
According to a report by The Athletic, Ballmer reportedly invested an additional $10 million in 2023 into Aspiration, the fintech firm alleged to have provided Leonard with a $28 million contract for promotional work he supposedly never completed. This deal is suspected to be a method of circumventing the NBA’s salary restrictions. The NBA has engaged a legal team to delve into these allegations, which could result in considerable consequences.
Ballmer had previously invested $50 million in the company when it was initially established. He has since defended his actions, asserting that he was “deceived” and denying any involvement in misconduct. Joe Sanberg, the co-founder of Aspiration, has admitted guilt to charges of fraud brought forth by the Department of Justice.
“The speculation is what it is,” Ballmer continued. “Why did they do that? I don’t know why they did what they did. And I don’t know how different it is. And frankly, any speculation would be crazy.
“These are guys who committed fraud. Look, they conned me. I made an investment in these guys thinking it was on the up and up. And they conned me. At this stage, I have no ability to predict why they might have done anything they did.”
Adding complexity to his defense is a report indicating that Leonard’s representatives sought a similar agreement from the Toronto Raptors, mirroring the one being questioned.
The situation continues to appear problematic for Steve Ballmer and the Clippers. At a minimum, it proved to be costly. (Photo by Scott Varley/MediaNews Group/Daily Breeze via Getty Images)
(MediaNews Group/Torrance Daily Breeze via Getty Images via Getty Images)
The timeline of Ballmer’s awareness regarding Aspiration’s financial stability remains unclear. However, his subsequent $10 million investment occurred when the company, which has since declared bankruptcy, was reportedly facing severe challenges, experiencing significant financial losses, employee layoffs, and operational setbacks.
Furthermore, reports surfaced on Thursday indicating that Dennis Wong, the co-owner of the Clippers, contributed an additional $1.99 million during the same period in 2023. This coincided with a $1.75 million payment to Leonard.
According to The Athletic, another co-founder of Aspiration continues to dispute the claim that Leonard’s position was a sham. He emphasizes a provision that permitted the Clippers star to decline engagements “not in line with his convictions.”
When reached by The Athletic this week, Andrei Cherny, Aspiration’s co-founder and CEO until 2022, disputed that Leonard had a no-show contract. He said the beliefs clause is standard for celebrity endorsements and that the company could end the agreement if Leonard didn’t perform on his end.
“In the months of discussion among our executives before signing the sponsorship, I don’t remember conversations about the NBA salary cap,” Cherny said. “I signed the contract shortly before I submitted my resignation, but before I left there were numerous internal conversations about the various things Aspiration was planning to do with Leonard once the 2022-23 season began, including emails from the marketing team about their plans in just the week before my last day. I can’t speak to what was done or not done after I left — or why.”
The Athletic further points out that Leonard’s endorsement agreement allocated him $20 million in equity for promotional responsibilities that he allegedly never fulfilled. This sum exceeded the investments of other celebrity investors, including Leonardo DiCaprio, Robert Downey Jr., and Drake, all of whom had investments under $5 million in the company.
