Knicks seek $10M+ in damages from Raptors, say Silver shouldn't arbitrate

In a court filing Monday, the New York Knicks said they're seeking more than $10 million in damages from the Toronto Raptors as part of a lawsuit alleging the theft of thousands of confidential files, and argued that NBA commissioner Adam Silver shouldn't arbitrate the dispute in part because of his close relationship with Raptors governor Larry Tanenbaum.

The Knicks' filing, which was obtained by ESPN, came in response to the Raptors' Oct. 16 motion to dismiss the Knicks' initial complaint and have Silver arbitrate the dispute.

In Monday's filing, the Knicks also argued Tanenbaum's position as the chairman of the NBA's board of governors would create a conflict of interest, as "Tanenbaum serves as Silver's boss and exercises control over and heavily influences Silver's continued employment and salary." Further, the Knicks pointed to a friendship between Silver and Tanenbaum.

"Among other things, Tanenbaum has been described as 'a close ally of Commissioner Adam Silver,'" the Knicks wrote. "Silver himself described Tanenbaum as 'not just my boss as the chairman of the board of governors, but he's very much a role model in my life.' If Silver were to preside over the instant dispute, he would be arbitrating a case for his boss and ally."

The Raptors declined comment.

Monday's filing marked the first instance of the Knicks describing potential monetary damages since they filed their initial complaint in August in the U.S. District Court in Manhattan.

That complaint accused former Knicks employee Ikechukwu Azotam, who worked for the Knicks from 2020 to 2023, of sending the Raptors thousands of confidential files -- including play frequency reports, a prep book for the 2022-23 season, video scouting files, opposition research and more -- after the team began recruiting him to join their organization in summer 2023.

The Knicks also accused Azotam -- who worked for the Knicks as an assistant video coordinator, then as a director of video/analytics/player development assistant -- of violating a confidentiality clause in an employment agreement and alleged that members of the Raptors "directed Azotam's actions and/or knowingly benefited from Azotam's wrongful acts."

Further, the Knicks alleged that the Raptors "conspired to use Azotam's position as a current Knicks insider to funnel proprietary information to the Raptors to help them organize, plan, and structure the new coaching and video operations staff," the lawsuit states.

Raptors coach Darko Rajaković, player development coach Noah Lewis and 10 "unknown" Raptors employees were also listed as defendants in the Knicks' lawsuit.

During Raptors media day Oct. 2, Raptors president Masai Ujiri addressed the lawsuit, saying, "There has been one time a team has sued a team in the NBA. One time. Go figure."

In an Oct. 16 filing, the Raptors called the Knicks' lawsuit "baseless" and a "public relations stunt" while also calling for Silver to arbitrate the dispute. The Raptors have made that request multiple times dating back to August.

In fact, roughly one week after the Knicks filed the initial complaint, the Raptors emailed NBA general counsel Rick Buchanan asking for Silver to assert jurisdiction over the dispute between the teams, pursuant to bylaw "d" in Article 24 of the NBA's constitution. That bylaw states: "The Commissioner shall have exclusive, full, complete, and final jurisdiction of any dispute involving two (2) or more Members of the Association."

But the Knicks -- then and even more forcefully in Monday's filing -- have objected to Silver adjudicating the dispute. In a Sept. 9 email to legal counsel representing both teams, Buchanan stated that the league would abide by further proceedings in the Southern District Court in Manhattan "for a determination of whether this dispute should be adjudicated in federal court or before [Silver]."

In another email Sept. 19, Buchanan repeated the league's stance to legal representatives from both teams.

In their filing Monday that opposed any arbitration by Silver in the matter, the Knicks said there are no provisions in the NBA constitution that address the theft of intellectual property or the protection of a team's intellectual property.

"Contrary to Defendants' claims, this is not a dispute about basketball operations," the Knicks wrote. "There is no nexus between the claims and the NBA Constitution -- it is a dispute about the theft of trade secrets by a disloyal employee, a scenario not contemplated by the NBA Constitution. Trade secret misappropriation, breaches of contract, and tort claims are the types of issues routinely appearing before federal judges. We are unaware of the NBA Commissioner ever having handled something similar. As a matter of contract formation, the arbitration provision cannot be applied to Plaintiff's claims."

The Knicks pointed to the limits on Silver's power for monetary penalties under Article 24 of the NBA's constitution, which states that the commissioner cannot issue a penalty of more than $10 million. Further, the Knicks pointed out the league's constitution does not authorize Silver to award legal fees in disputes between two teams.

"As the Knicks intend to prove at trial, damages exceed $10 million," the Knicks said in Monday's filing, adding that they also intend to seek attorneys' fees.

An MSG spokesperson issued the following statement to ESPN on Monday: "We were the victim of a theft of proprietary and confidential files, which is a clear violation of criminal and civil law, and we remain confident that the Court will decide in our favor in this matter."