This new revelation adds another dimension to the existing probe, which has primarily focused on a $28 million endorsement deal Leonard received from Aspiration, an environmental company that has since gone bankrupt. Clippers owner Steve Ballmer has asserted that he was defrauded by Aspiration and its co-founder, Joe Sanberg, who was recently sentenced to 14 years in prison after pleading guilty to wire fraud.
The “Pablo Torre Finds Out” podcast, citing multiple anonymous sources with knowledge of the Clippers and the Intuit Dome project, detailed the alleged Daktronics deal. Sources indicated that Leonard served as a spokesperson for Daktronics in connection with the Clippers. The exact duration and start date of this alleged contract remain unclear, but one source described it as being worth “millions of dollars.”
When approached for comment, Daktronics referred inquiries to a spokesperson for a crisis management firm. This spokesperson stated, “My understanding is Daktronics doesn’t have a deal with Kawhi right now.” Further clarification on the company’s stance was met with, “I don’t know what the company wants to say, or can say, given the Wachtell investigation and all that.”
Daktronics is a significant player in the sports venue technology market, producing video boards for numerous NBA arenas, including those of the Phoenix Suns, Charlotte Hornets, Milwaukee Bucks, Detroit Pistons, Memphis Grizzlies, and Brooklyn Nets. A search of the company’s website for “Kawhi Leonard” yielded no results.
The NBA has not yet responded to requests for comment on these latest allegations, nor have the Clippers.
The investigation, being conducted by the law firm Wachtell, Lipton, Rosen & Katz, has been ongoing since last fall. The firm is examining whether Leonard had other unreported endorsement deals, according to sources who spoke to The Athletic on the condition of anonymity.
This investigation has had tangible consequences, notably delaying a potential trade that would have sent Leonard from the Clippers to the Toronto Raptors, his former team. NBA Commissioner Adam Silver addressed the situation in July, clarifying that the trade parties themselves decided not to proceed due to the unresolved investigation and the uncertainty surrounding Leonard’s contract status. “The parties to the trade made a decision not to go forward given that the investigation remained open,” Silver stated. “And so, they chose not to live with that uncertainty.”
Silver previously indicated that the investigation was expected to conclude before the upcoming NBA season. Should the NBA find that the Clippers violated the Collective Bargaining Agreement (CBA), potential penalties are severe. These could include substantial fines, forfeiture of future draft picks, sanctions against owner Steve Ballmer, or even the voiding of Leonard’s contract.
This is not the first time Leonard’s contract negotiations have drawn scrutiny. In 2019, when Leonard became a free agent, his representatives reportedly requested several impermissible benefits from the Los Angeles Lakers, including private aircraft, a home, guaranteed off-court earnings, and an ownership stake. The Lakers reportedly informed Leonard’s team that these requests violated NBA rules and constituted salary cap circumvention.
Both Kawhi Leonard and the Clippers organization have consistently maintained their innocence throughout the investigation. Leonard himself expressed confidence after the Clippers’ season, stating, “I think we’re going to be in the clear. It’s not stressing.” Lawrence Frank, President of Basketball Operations for the Clippers, echoed this sentiment in February, saying, “We’re on the right side of this.”
The podcast “Pablo Torre Finds Out” is produced by Meadowlark Media and became part of The Athletic Podcast Network in September through a licensing agreement.
**Potential Salary Cap Circumvention Allegations**
Sources cited in the “Pablo Torre Finds Out” report explicitly suggest the Daktronics deal was designed to circumvent the salary cap. One anonymous high-level source under contract for the Intuit Dome alleged that the sponsorship was “1,000% a way to circumvent the salary cap. It was funneling money from the Clippers through Daktronics back to Kawhi.”
Another anonymous former Clippers official corroborated this, stating they were aware of the sponsorship deal and its potential purpose. The implication is that the Clippers may have used Daktronics as an intermediary to pay Leonard additional money beyond his official NBA contract, thereby exceeding the league’s strict salary cap limits.
**Daktronics’ Financial Context**
Adding another layer to the allegations, Torre and co-reporter Sam Koppelman of Hunterbrook Media noted that Daktronics was reportedly experiencing financial distress around 2023, the period during which they were working on the Intuit Dome video board. This financial strain could, in theory, make the company more amenable to lucrative deals, even if structured unusually.
Furthermore, it was reported that Daktronics utilized a crisis communications firm that has previously worked with notable figures connected to the Clippers’ ownership transition, including Shelly Sterling and an LLC owned by Steve Ballmer. This connection, while not direct evidence of wrongdoing, raises questions about the circles involved.
**NBA’s Investigation and Potential Ramifications**
The NBA’s investigation, spearheaded by Wachtell Lipton, began in September following initial reports. The focus is on whether the Clippers and Leonard engaged in practices that circumvented the salary cap, particularly concerning the Aspiration deal. The league’s response to confirmed violations can be severe. Commissioner Silver has outlined potential penalties that include substantial fines, the stripping of valuable first-round draft picks, personal sanctions against owner Steve Ballmer, and, in the most extreme cases, the voiding of Leonard’s contract. The outcome of this investigation holds significant implications for the Clippers’ future roster construction, financial standing, and overall integrity within the league.
The fact that the trade to the Raptors was paused underscores the seriousness with which the NBA and the involved parties are treating the investigation. The league aims to resolve such matters before the start of each season to ensure competitive balance and adherence to its financial regulations.
**Broader Context of Player Sponsorships and Cap Rules**
NBA salary cap rules are designed to promote competitive balance among teams by limiting the amount of money franchises can spend on player salaries. Sponsorship deals are a common way for players to earn additional income, but these must be conducted independently of the team and adhere to league regulations. When team affiliations or indirect payments blur these lines, it triggers investigations into potential cap circumvention. The Aspiration deal, involving an investment from Ballmer’s LLC and a subsequent endorsement deal with Leonard, was the initial trigger. The alleged Daktronics deal suggests a potential pattern of such arrangements, which, if proven, could lead to significant penalties for the Clippers.