NBA announces settlement with Sterling Trust allowing Clippers sale to Ballmer. Cancels vote on Donald Sterling.
May 30, 2014, 7:26 PM EST
How confident is the NBA that Shelly Sterling has pushed aside her husband Donald Sterling in the family trust and can now sell the Clippers to Steve Ballmer?
Enough that they have cancelled the vote scheduled for next week that would have deposed Donald Sterling as an owner.
The NBA announced Friday that it has reached a settlement with the Sterling Trust (through which Donald and Shelly Sterling each own half of the Clippers). Here is the NBA’s official statement.
The NBA, Shelly Sterling and the Sterling Family Trust today resolved their dispute over the ownership of the Los Angeles Clippers. Under the agreement, the Clippers will be sold to Steve Ballmer, pending approval by the NBA Board of Governors, and the NBA will withdraw its pending charge to terminate the Sterlings’ ownership of the team.
Because of the binding agreement to sell the team, the NBA termination hearing that had been scheduled for June 3 in New York City has now been cancelled. Mrs. Sterling and the Trust also agreed not to sue the NBA and to indemnify the NBA against lawsuits from others, including from Donald Sterling.
Donald Sterling’s lawyer confirmed an NBC News report he planned to file an antitrust lawsuit against the NBA seeking $1 billion in damages due to his banishment from the league and the league forcing a sale of his team.
The interesting news from the league’s statement is not just that the deal is now official in the eyes of the league (that was expected, the league has been working hand-in-hand with Shelly Sterling through this process), nor is it just that the Board of Governors’ meeting is cancelled and the vote called off.
It is that the league believes by getting indemnity from the Trust — of which Donald Sterling is still a part, albeit one without a vote — it essentially negates Sterling’s lawsuit against the league (and likely future ones).
The indemnity likely means that any money Donald Sterling would win in his lawsuit against the NBA would be paid by the Sterling Trust — essentially Sterling is suing himself, according to sports law writer Michael McCann of Sports Illustrated.
Plus, Donald Sterling is threatening an anti-trust lawsuit based on the forced sale of his team, but the NBA can counter co-owner Shelly Sterling chose to sell the team, this was not a forced sale where the team was taken away from him.
Donald and Shelly Sterling each owned half of the Los Angeles Clippers through the Sterling Family Trust (he was the recognized primary owner by the league). However, following neurological tests in the last month she had him declared mentally incapacitated, making her the sole trustee. Donald Sterling’s lawyers have vehemently denied he is incapacitated, although that is separate from the lawsuit he filed against the NBA.
The incapacitated ruling cleared the path for the sale of the team to Ballmer for $2 billion. The NBA worked with Shelly throughout this process and the fact the league is making this announcement and canceling the vote shows how confident it is in its legal position. Also, for years the NBA has been interested in bringing Ballmer — the former Microsoft CEO worth $20 billion — in as an owner.
All of this ultimately means that by the start of next season this saga could be over — Doc Rivers and the Clippers players could be reporting to the energetic Ballmer.
Something that would be good for everyone. We’d all like to move on from this saga.
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