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NBA Commissioner Adam Silver announced that the league has banned Los Angeles Clippers owner Donald Sterling for life and fined him $2.5 million — the maximum fine under the NBA’s constitution — due to racist statements made by the 81-yr-old owner.

As you may know by now, Sterling told a former mistress not to associate with blacks and admonished her for bringing blacks to NBA games and fraternizing with Magic Johnson.     

The question now is: does Sterling have any legal rights, will he file suit and did the NBA have the power to suspend or terminate him in the first place.

The quick answers: Sterling does have a legal right to file suit; and probably will file, but it is an uphill battle and he will most likely lose.

Whether the NBA has the power in what’s being called a slippery slope by many, including Dallas Mavericks owner Mark Cuban, is yet to be determined by a court.

It is a very complex situation, but look carefully at the process.

Under the NBA’s constitution, Silver does have the power to fine (and he did to the tune of $2.5 million maximum) and he can push for the ouster of anyone who is damaging the brand of the NBA or engaging in conduct detrimental to the league.  His decisions are also binding similar to an arbitrator and would end up in court in New York if challenged, under the constitution.

Article 13 of the NBA constitution deals with “The Termination of Ownership or Membership” of an owner like Sterling.

While it doesn’t specifically deal with racism, it does have a catch-all section that arguably could apply to Sterling, including a reference for termination if an owner willfully violated the bylaws and constitution.

But, even more relevant to this battle is Article 24, subsection (a) which sets forth the full power of the Commissioner:

(a) A Commissioner shall be elected by the affirmative vote of three-fourths (3/4) of all the Governors. The Commissioner shall serve as the Chief Executive Officer of the League and shall be charged with protecting the integrity of the game of professional basketball and preserving public confidence in the League.  (Emphasis added).

Silver can argue that the termination of Sterling falls under this language and it was necessary given the imminent boycott and strike by the players, the national outrage and the potential for billions lost in revenue for the league if he did not move swiftly in ousting Sterling.

Additionally, by publicly urging the other owners to give him the 75% vote threshold that he needs to oust Sterling, he invoked the opening paragraph of Section 13 of the NBA constitution which allows the owners to unite in the event someone threatens the overall good of the NBA brand and slam dunk them.

But, even as thorough as Silver was in his swift movement just 90 days on the job, I believe there will still be a legal case brought by Sterling challenging this power, authority and interpretation of the Constitution.

Sterling is not afraid of lawsuits or legal battles.  As an owner of thousands of condos, he has been sued and lost some and won some.  He also has dealt with suits involving racism and discrimination, including one filed by former Clippers exec and NBA great Elgin Baylor.

 

So, I imagine today he is huddling up the best lawyers money can buy to prepare his war chest and assault on the NBA; and most likely, he will look at a few considerations for his legal challenge.

 

First, is the power granted to Silver, too broad and whether or not there is antitrust violation.  He will ask a court to grant a temporary injunction for purposes of keeping him in the ownership chair, pending a full hearing and evidence and witnesses.

 

An injunction ordered by a court, would be tragic for the NBA as it could leave Sterling on the sidelines, courtside at games, while awaiting a full legal review in court.

 

Secondly, Sterling will argue that the financial consequence –estimated tax bill of over $300 million if he sold for a billion today as experts predict – far outweighs any damage he could do to the league, if he agrees to certain conditions, including allowing an appointed trustee to run the day-to-day, an agreement to not speak on the issue and to give his full cooperation to the league.

And, lastly, as a long stretch and difficult one, he may invoke a 1st Amendment freedom of speech argument and challenge on constitutional grounds.  This is a very hard argument to make, but he will definitely throw it in as a point of contention and legal argument.

If nothing else, a legal challenge by Sterling will force the NBA to negotiate with him and allow him to leave on his own terms.

Let’s just hope he leaves!

About the Author – James L. Walker, Jr., is an attorney based in Atlanta, GA.  He is a sports and entertainment lawyer for dozens of artists, athletes and businesses around the country. He can be found at www.walkerandassoc.com or emailed at jjwalker@walkerandassoc.com