Source: NBA may fast track Sterling's sale of Clippers
Tuesday's NBA owners meeting, in which a vote to oust Los Angeles Clippers owner Donald Sterling was set to take place in New York City, may not happen after all.
According to sources, if Sterling presents the NBA with a completed agreement to sell the Clippers before Tuesday's meeting, and if the NBA has a "favorable impression" of both the dollar amount and the incoming owners, the league would postpone the hearing until it can formally vet the purchase, sale agreement and pending owners. If the NBA later approves the transaction, the Clippers would be sold and Sterling, along with his wife and co-owner, Shelly Sterling, would no longer have any affiliation with the NBA.
Sources tell SI.com that the NBA's top priority is for ownership to be transferred, and the league would welcome the exchange occurring voluntarily. A voluntary transfer would avert a potentially contentious hearing next Tuesday and, more importantly, avert the potential of Sterling filing a costly and lengthy lawsuit against the NBA and its owners.
The NBA postponing Tuesday's hearing and then reviewing a bid to purchase the Clippers would be an extraordinary development. The NBA normally takes several months to approve the purchase of a team, as detailed background checks on every bidder in a group are conducted. To be clear, the NBA would not grant final approval of a Clippers sale before next Tuesday. It would only agree to postpone a hearing to oust Sterling until it can approve or reject his agreement to sell the Clippers. If the NBA ultimately rejects the agreement, Sterling's hearing would be rescheduled and he would again face ouster from the NBA. The NBA is determined to resolve the Clippers ownership before the start of the 2014-15 season.
A number of persons and groups have submitted bids to the Sterlings over the last 24 hours. Some of those bidders, sources tell SI.com, have already been vetted by the NBA when previously attempting to buy other NBA franchises. In addition, other bidders have already been approved as NBA owners, as they possess minority interests in other NBA teams. While additional vetting would be required -- including a thorough assessment of a bidder's current financial status -- the NBA is inclined to respond favorably to potential owners who have already been screened. The NBA would also consider other bidders who are positioned to buy an NBA team for what would be a record price.
Should Sterling sell the team, he would have to pay a capital gain tax of about 33 percent on the difference between what he bought the team for $12.5 million and its purchase price. While the tax is a deterrent to selling the team, it's believed that if Sterling can sell the team for a record fee -- former Microsoft CEO Steve Ballmer has reportedly offered $1.8 billion -- he would be willing to absorb the resulting tax hit.