Donald Sterling’s dramatic month was capped off with a fittingly tumultuous final week. Let’s review: Sterling authorized his wife to sell his beloved basketball team, then disavowed that plan. He received an offer for $2 billion to buy the team, then was deemed mentally unfit to make authorizations on behalf of his family trust. He then filed a lawsuit against the NBA for $1 billion, only to have the NBA approve the $2 billion sale of the Clippers and forego the now unnecessary forced sale process. Got it?

The flurry of events would be hard enough to understand were they to make sense, but they don’t seem to do that. Why would you authorize your wife to sell the team then sue after she fields a great offer? Maybe there is another motive at work? Maybe Donald Sterling is mentally incapacitated . . . like a fox.

Make no mistake, Donald Sterling was a shrewd attorney and businessman in his day. His ability to navigate the greater Los Angeles real estate market made him millions of dollars and gave him the means to buy the Clippers in the first place. But if the average shrewd businessman felt he were being unfairly forced to sell his largest asset, he might try to halt the sale by requesting injunctive relief from a court. At the very least, he might request a temporary injunction to slow the process. Sterling hasn’t done that. In fact, in the complaint filed by his attorneys on May 30, Sterling asks only for money damages.

Perhaps Sterling believes the value of his basketball team has been artificially inflated. Upon hearing whispers regarding what his team could sell for, he instructs his attorney to draft a letter ceding all selling responsibility to his wife, Shelly. After his instinct regarding his team’s worth is seemingly validated upon Steve Ballmer offering to buy the Clippers for $2 billion, Sterling decides to let the sale proceed. He instructs his attorneys to remove from their suit any provision requesting temporary or injunctive relief.

Ostensibly approving of a sale could make him appear feckless and get his lawsuit against the NBA thrown out of court, so next he agreed to undergo a mental evaluation knowing he would be diagnosed with Alzheimer’s. This diagnosis would leave Shelly alone to approve the sale, while Donald could still carry on his lawsuit against the NBA while still projecting the image of an angry, dangerously litigious man. After the sale is completed, Donald would remove his assets from the Sterling family trust. This way, if Donald Sterling was to successfully sue the NBA, the latter could only collect reimbursement from Shelly Sterling. Donald meanwhile, would be resting comfortably with his recently improved pile of money, and a newer, possibly even more vapid young lady to spend it on.

Possible? Maybe. Probable? Maybe not. The flurry of chess-like moves may only appear strategic considering the wealth and profiles of the parties involved. The truth may be that Donald Sterling is a spiteful man who no longer possesses the abundance of fluid intelligence he once had, but maintains the wealth to fire various shots via high priced attorneys. But even that would seem to make too much sense, and really nothing in this saga is as it appears.

Andrew Blancato

The post A Donald Sterling Conspiracy Theory appeared first on Law Street.

As those of us who don’t live under a rock know, an audio recording was leaked to the media last weekend of Clippers owner Donald Sterling making racist remarks. Last Tuesday, NBA Commissioner Adam Silver addressed the comments and levied historic punishment against Sterling, which included a $2.5-million fine, a lifetime ban from the NBA, and a forced sale of the basketball team that Sterling has owned since 1981. The punishment has earned Commissioner Silver the praise of basically everyone, but the envy of none. That’s because forcing Donald Sterling to sell his basketball team will be fraught with legal difficulties.

The greatest legal obstacle to overcome before finding the Clippers a new owner may be the antitrust hurdle. Several attorneys have opined that there’s little precedent beyond financial instability that permits a commissioner to force an owner to surrender ownership rights. The NBA Constitution, made public last week, is also arguably overbroad with regard to the behavior that can earn an owner the boot. Section 13(a) states that ownership stakes may be terminated if an owner “willfully violate(s) any of the provisions of the Constitution and by-laws, resolutions, or agreements of the Association.” That could include almost anything.

Leagues have been taken to court over similar antitrust issues. In 1994, former New England Patriots owner Billy Sullivan sued the NFL for antitrust violations after the league refused to let Sullivan sell a portion of the Patriots through a public stock offering.  The NFL settled the case with Sullivan for $11.5 million.

A potential antitrust case is also possible considering the domain Silver would exercise over potential buyers. Silver, like other sports commissioners, is likely to veto any buyer who plans to relocate the team to Las Vegas, due to the omnipresence of gambling in Nevada.

Sterling, on the other hand, would likely fight if the team was to be sold for anything less than $1 billion. The Milwaukee Bucks, ranked as the least valuable NBA franchise, sold this year for $550 million, $45 million more than their Forbes valuation. Considering the Clippers are in a bigger market and will soon be signing a lucrative media deal, Sterling could demand at least a $1 billion price tag.

There’s also the antitrust complication posed if NBA Hall of Famer Magic Johnson were to buy the team. Having one of the all-time affable NBA legends purchase a franchise in a city that adores him seems like the perfect fit, but consider the issue this way: Can someone force a businessman to sell his most lucrative asset to the guy he spoke disparagingly of in a private message, especially if that guy has unparalleled clout and is most likely to leverage power in writing contracts with area media networks? Sterling’s lawyers would say no, and they could be right.

Beyond antitrust issues, forcing Sterling to sell his team could be complicated by marital issues. The team is currently owned by a family trust, which could be liquidated or divided if Sterling initiated divorce proceedings against his wife, Rochelle Stein. Generally, property acquired during marriage in California is considered community property and subject to equitable distribution. Were Sterling to seek court intervention for a divorce proceeding, a California family court would halt any sale of the Clippers — absent mutual assent of the parties — in order to equitably distribute the community property of the marriage.  A court could potentially even award the Clippers to Stein (unlikely, but stranger things have happened in LA).

There’s also the possibility that probate court could complicate a Clippers sale. That’s right, in what would be filed in the “be careful what you wish for” hall of fame, Donald Sterling could die and totally screw things up for the Clippers. Like in family court, a probate court judge would presumably halt any sale of the team subject to the terms of the family trust and/or Sterling’s will. If Sterling died before a sale date was set (not a ridiculous scenario), the NBA would have the displeasure of convincing a judge that the owner-approved complaint against Donald Sterling stripping him of his ownership rights also applies to the heirs and wife of Sterling despite them not having violated NBA policy.

There you have it. If he can’t go to the games, then Donald Sterling will see you in hell.

—

Andrew Blancato (@BigDogBlancato) holds a J.D. from New York Law School, and is a graduate of the University of Massachusetts, Amherst. When he’s not writing, he is either clerking at a trial court in Connecticut, or obsessing over Boston sports.

Andrew Blancato

The post Punishing Donald Sterling Is About to Get a Lot Harder appeared first on Law Street.

It’s no secret that many Americans feel there are too many lawsuits in this country. If you’ve ever been selected for jury duty, then you know that one of the most common questions asked before sitting on a civil case is whether or not people sue too often. The answer back to the attorney is often “yes,” not just because the panelist is seeking to avoid jury service, but because that’s the view espoused by many when reflecting on the American zeitgeist.

This sentiment is caused, or at least reinforced, by the media’s reporting of lawsuits. The headlines that make the largest waves are often based on huge, seven-digit verdicts. Laura Beth Nielsen and Aaron Beim alluded to this correlation in a recent paper claiming the courts are not as favorable to plaintiffs as the media often portrays, yet the media’s reports are what the public absorbs. Neilsen and Beim’s chief example is a Boston Globe report of an MBTA worker who was awarded a $5.5 million discrimination verdict. The verdict was later reduced by 80 percent on remittitur, an important detail the Globe did not feature as prominently as the original verdict. It seems that cases alleging discrimination in the workplace carry a stigma with the public and media.

Just as the figures of a verdict can be lost on the average American, so too can the merits of the underlying discrimination case. In 2009, former Los Angeles Clippers executive Elgin Baylor sued team owner Donald Sterling alleging racial discrimination. A jury of 12 unanimously rejected Baylor’s suit, and many called the hall of famer’s action frivolous.

Cases alleging tales of sexual discrimination are no different. This year alone, cheerleaders from three different NFL teams have sued their employers, often alleging sexual harassment among a variety of different wage claims. Knee-jerk reactions to such suits are often negative, as evidenced in the comments section of ESPN articles covering the matter.

A closer look at both situations may evoke a more tolerant response. Since his lawsuit, Elgin Baylor’s former employer has allegedly been caught on tape making racist comments against African Americans, and some former Clippers aren’t surprised by his discriminatory tendencies. Details have also emerged in the cheerleading case of the Buffalo Jills, whose employer allegedly instructed them on how to control their menstrual cycles and how to wash their “intimate areas.”

In sum, it’s never a bad idea to reserve judgment on a lawsuit that appears in the news or on TV, even one alleging discrimination. In fact, suits alleging workplace discrimination often already have safeguards in place against frivolous litigation, like the EEOC’s Right-To-Sue-Letter. But even absent an EEOC investigation, plaintiffs should be afforded a blank slate. Few things in this country are as ubiquitously opposed as prejudice and discrimination. Those who decide to sacrifice time, money, and privacy to personally combat these evils in a public court should be heard with an open mind.

____

Andrew Blancato (@BigDogBlancato) holds a J.D. from New York Law School, and is a graduate of the University of Massachusetts, Amherst. When he’s not writing, he is either clerking at a trial court in Connecticut, or obsessing over Boston sports.

Featured image courtesy of [BuffaloProCheer via Wikipedia]

Andrew Blancato

The post Rethinking Discrimination Suits in Light of Buffalo Jills, Donald Sterling appeared first on Law Street.