The potential legal fallout from Donald Sterling's CNN interview

Donald Sterling stands to lose a lot of money in taxes if he's forced to sell the Clippers.
Ronald Martinez/Getty Images

In an exclusive interview with CNN's Anderson Cooper that aired Monday night, Los Angeles Clippers owner Donald Sterling spoke publicly for the first time since the NBA banned him for life. Sterling apologized for making racist remarks and insisted that he is not a racist.

Sterling also repeatedly insulted Magic Johnson, whose photograph with V. Stiviano prompted Sterling's infamous remarks two weeks ago. At other times, Sterling shared scattered thoughts. Sterling's occasional incoherence may signal legal trouble ahead for the NBA: Could the 80-year-old billionaire argue he is less blameworthy because of advanced age and associated mental limitations? Keep in mind, Sterling's wife, Shelly Sterling, recently told ABC's Barbara Walters that she believes her husband is afflicted with early dementia.

To be clear, there has been no reporting that Donald Sterling suffers from any cognitive impairment, let alone dementia, and he made no such acknowledgment during the interview. Cooper, for his part, addressed this issue and said he found no signs of dementia in Sterling, instead regarding Sterling as "very present" during their conversation.

Sterling has also been embroiled in race and other controversies for decades, which suggests his latest controversy is more about who he is than his age.

Still, Sterling gave several odd responses to Anderson which, when coupled with his wife's suspicions, may cause the NBA anxiety. Consider this small sample of questions and answers from the interview:

COOPER: So, you're saying that African-Americans don't contribute to their -- to African-American communities as much as Jewish people do?

D. STERLING: There's no African-American -- never mind. I'm sorry. You know, I -- they all want to play golf with me. They -- everybody wants to be with me.


COOPER: [Magic Johnson's] opened a lot of businesses in inner-city neighborhoods.

D. STERLING: The Jewish people -- the Jewish people have a company, and it's for people who want to borrow money and no interest. They want to give them a fish pole -- a fishing pole. We want to help people. If they don't have money, we will loan to it you. You don't have interest. One day, you will pay us back.

GOLLIVER: Sterling blasts Magic Johnson for having 'AIDS'

While these responses may reveal a man who makes sweeping generalizations about groups of people -- especially African-Americans and Jewish people—they may also signal a man who no longer processes information as effectively as he once did. Along those lines, would some owners feel uncomfortable ousting an elderly owner whose mind may not be what it was? Would they feel even more unease if Sterling is diagnosed by a physician with an actual cognitive impairment? Remember, a supermajority of NBA owners -- 22 out of 29 -- will be needed to oust Sterling. If Sterling, the longest serving owner, can find eight sympathetic colleagues, he won't be kicked out of the league.

The NBA's legal case against Sterling is premised mainly on Article 13(d) of the league constitution. This article states that an owner cannot "fail or refuse to fulfill ... contractual obligations to the Association, its Members, Players, or any other third party in such a way as to affect the Association or its Members adversely."

As learned by last Friday, the NBA plans to argue Sterling failed to meet contractual obligations in his franchise and joint venture agreements with the league. Relevant obligations in those agreements compel owners to avoid unethical conduct and taking positions that damage the league. Benefiting the NBA, 13(d) does not require intent or willful conduct, only that the owner didn't meet contractual obligations. As a result, NBA owners could find Sterling violated 13(d) even if he suffers from cognitive impairment. In response, Sterling could in theory argue that he is protected from ouster by the federal Age Discrimination in Employment Act, but the Act likely would not apply since, among other reasons, Sterling is not an employee of the NBA. Nonetheless, the moral case for ousting Sterling would be weakened if he can prove or suggest his racist remarks reflected a lesser mental state.

Three other impressions from the interview and their legal impact

1. It's stunning Sterling's lawyers and public relations advisers would green light this interview

Cooper surprisingly revealed that Sterling was without legal counsel and public relations advisers for the interview. While "Sterling unscripted" may have been the real deal, genuineness was probably the wrong approach for someone with Sterling's cantankerous style and cringeworthy worldview. Indeed, Sterling used the interview as much to apologize as to savagely attack Johnson and offer archaic and ignorant generalizations about race. He also referred to the 31-year-old Stiviano as a "girl" rather than a woman. This was not a man who seemed "coached" by his handlers at all. Unfortunately for Sterling, he likely scored no points with the scorers: the other 29 controlling owners of NBA teams.

GOLLIVER: Sterling says he may cooperate with the NBA to avoid suit

Sterling's responses to Cooper can also be used by the NBA as evidence when owners conduct a hearing about him. They can also be used in court should Sterling later file a lawsuit. This is why legal counsel likely would have strongly discouraged Sterling from speaking with Cooper: it created a transcript of admissible answers to a difficult questions asked by a skilled interviewer.

2. Sterling says he has no plans to sue ... yet

Sterling appeared to make a concerted effort to speak to other owners -- "partners" as he called them. He did so by directly apologizing to them and emphasizing that he "loves" every one of them. Sterling added that he doesn't want to fight his partners in court, although he didn't rule it out. Sterling is undoubtedly aware that he would avoid paying hundreds of millions in capital gain taxes if he can hold onto the team (a benefit first raised by Robert Raiola, senior manager in the Sports & Entertainment Group of the accounting firm O'Connor Davies, LLP, for Sterling has perhaps reasoned that it is better to first try pleading to the friendship and loyalty of fellow owners than to threaten them. But if he's voted out, his tone may change swiftly and dramatically.

3. Adam Silver's apology to Magic Johnson sends a message to NBA owners

Sterling took sharp aim at Johnson during the interview, at one point saying of Johnson:

"Well, what kind of a guy goes to every city, he has sex with every girl, then he catches HIV and -- is that someone we want to respect and tell our kids about? I think he should be ashamed of himself. I think he should go into the background ... But what does he do for the black people? Doesn't do anything." Silver apologized to Johnson on behalf of the NBA for Sterling's remarks. Silver expressed outrage that Johnson "continues to be dragged into this situation and be degraded by such a malicious and personal attack." Silver's apology was as much a statement to Johnson as it was an advisory to the 29 owners that they need rid the NBA of Sterling.v

Michael McCann is a Massachusetts attorney and the founding director of the Sports and Entertainment Law Institute at the University of New Hampshire School of Law. He is also the distinguished visiting Hall of Fame Professor of Law at Mississippi College School of Law.

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