The NBA's Options in Dealing With Donald Sterling

VIDEO: Donald Sterlings Girlfriend Leaves Home with Face Covered
ABCNews.com

What will happen to Donald Sterling, the owner of the Los Angeles Clippers who is accused of making racist remarks that have enraged everyone from the NBA Players Association to President Obama?

Michael McCann, director of the University of New Hampshire's Law Sports and Entertainment Law Institute and columnist for Sports Illustrated, said there's no precedent for kicking an owner out of the NBA, but the pressure is mounting on the league and Sterling for some unprecedented action.

Read More: Breaking Down the Donald Sterling Scandal: The Audio, The Lawsuits, the Reactions

The NBA's constitution is confidential but reportedly has language allowing owners to authorize the league to sell a team without an owner's consent, McCann said, but it's likely related to situations when an owner can't pay the bills. That doesn't seem to be the case for the billionaire Clippers owner.

Whether Sterling, who turned 80 years old on Saturday, would want to add to his already estimated $1.9 billion with the sale of the team is an unknown.

Once the NBA completes its investigation in this matter, including determining the authenticity of the recording, here are some of the options the league may have:

PHOTO: Los Angeles Clippers owner Donald Sterling sits courtside at an NBA basketball game between the New York Knicks and the Los Angeles Clippers in Los Angeles, April 4, 2010.
Danny Moloshok/AP Photo
1.
NBA could encourage Sterling to sell the team

McCann said the smoothest scenario would be if the NBA successfully persuaded Sterling to sell. Sterling bought the team in 1981 for $12.5 million, but it may be worth more than $700 million today, McCann said.

Forbes last valued the Clippers at $575 million in January -- before the playoffs and the team tied 2-2 to the Golden State Warriors in the first round. Forbes' senior editor Kurt Badenhausen calls the $575 million price tag "certainly a conservative estimate," especially considering that the Milwaukee Bucks' reported purchase price is $550 million, and the Clippers are considered a better team.

Read More: NAACP Yanks Donald Sterling's Award But Willing to 'Forgive' Him

"There’s something to be said about owning a franchise in the second biggest market in the country. These teams, particularly in LA, don’t come up for sale very often."

The other longest tenure of ownership in the league is the Buss family. Jerry Buss led the Los Angeles Lakers franchise from 1979 until he died in February 2013. His controlling interest was bequeathed to his children.

Tim Frank, a spokesman for the NBA, declined to comment to ABCNews.com until the investigation is complete.

2.
NBA could fine Sterling

NBA commissioner Adam Silver has the right to punish owners and others in the NBA for conduct detrimental to the league's best interest, McCann said. Among the largest fines levied on owners include Dallas Mavericks owner Mark Cuban's $500,000 penalty for criticizing officials and the same amount levied to Miami Heat's Micky Arison for tweeting about the NBA lockout in 2011. The league usually directs these proceeds to a charitable cause, McCann said.

"To you or I, it would be the end of the world," McCann said of the fines. But for billionaires, "It’s hard to know the impact."

Watch: NAACP: Alleged Donald Sterling Comments Are ‘Jim Crowish’

Meanwhile, a handful of companies have pulled sponsorship of the Clippers due to Sterling’s alleged remarks, including Kia Motors, Virgin America, Amtrak, Red Bull and CarMax.

The Clippers and Sterling did not respond to a request for comment from ABCNews.com.

Robert Tuchman, president of Goviva sports marketing agency, said, “Without sponsorship monies, the team would most likely be operating at a significant loss. Without fan support, tickets, or suites they might not be able to stay in business.”

3.
NBA could push Sterling to become minority owner

If the NBA and other owners did not persuade Sterling to sell the team, it's not out of the question that he could sell part of his stake, McCann said.

Read More: What We Know About V. Stiviano, Woman Accused of Leaking Racist Rant

While Sterling was not in attendance at the Clippers' game against the Golden State Warriors on Sunday, his estranged wife, Rochelle, shared a statement over the weekend saying she did not condone the alleged statements, stating, "I am not a racist."

"The team is the most important thing to my family," her statement read.

4.
Suspend Sterling

One way for the NBA to indirectly push Sterling out, McCann said, would be to suspend him, whether it's one or two years, or indefinitely.

"I think the NBA could suspend him indefinitely and wait it out until he agrees to sell the team," McCann said.

Major League Baseball twice suspended Cincinnati Reds owner Marge Schott, for one year and two years, respectively in 1993 and 1996, when she made racist remarks about African Americans and favorable comments about Adolph Hitler. She eventually sold the team in 1999. That league also suspended Yankees owner George Steinbrenner for hiring a private investigator to conduct negative research on Baseball Hall of Famer Dave Winfield.

Being suspended can mean you are barred from attending games and may require educational or life betterment classes, says Tuchman. The late Los Angeles Lakers owner Jerry Buss was suspended for two games after being found guilty of driving under the influence in 2007.

5.
Expel Sterling from the NBA

Expelling Sterling from the NBA is unlikely, McCann said, in part because it could set a precedent and create a legal nightmare for the league and the other owners.

"The NBA doesn’t want to enter a lawsuit with Donald Sterling," McCann said. "Donald Sterling has been involved in lawsuits. He’s also a lawyer. He’s not going to be afraid of the legal process."

If an owner is forced out, he or she could potentially make at least three legal arguments against the league and other NBA owners: defamation, breach of contract or that the league and its owners violated anti-trust laws, in which case, the damages would be treble.

"Someone could argue the NBA and other owners have joined hands to expel them from the league, and as a result they had to sell the team when they couldn’t get the highest bidder," McCann said. "For example, if he said he lost $300 million, that's a $900 million hit."

6.
NBA could take over the day-to-day operations of the Clippers

Major League Baseball did this with the Los Angeles Dodgers and owner Frank McCourt, when they experienced payroll problems, but there is no reason to believe the Clippers are experiencing financial issues, so this scenario is unlikely, McCann said.

Matt Dzamba, director of sports marketing at Zambezi, said the NBA will do what is best for the league, as they did for the New Orleans Hornets back in 2010. The NBA bought the Hornets to help the financially struggling franchise, eventually selling the team.

“If I was Adam Silver, I would say to Donald Sterling, ‘Let’s make this as painless as possible for you and still get strong value,’" Dzamba said. "The alternative is a cloud over this franchise for the foreseeable future, with fewer sponsors and jerseys sold and fans who stop coming to games under his ownership.”

7.
Moving forward...

The NBA could raise its emphasis on character when considering the future ownership, McCann said. Though the NBA likely has loose language like this in its constitution, an owner's character could be a conditional portion of owning an NBA team, if nothing else for public relations, he said.

"This could raise the emphasis on character when buying a team, instead of just getting the wealthiest person or highest bid," McCann said. "It’s getting a person who will be a good citizen and, at a minimum, not be racist. It’s a low bar."

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