Donald Sterling to drop lawsuit against NBA, agree to sale of Clippers

Author:
Rob Mahoney
Publish date:
Jun 4, 2014

Donald Sterling has owned the Clippers for 33 years. (Juan Ocampo/NBAE via Getty Images)

At long last the Donald Sterling saga comes to a close.

After threatening to file a $1 billion lawsuit against the NBA last week, Sterling has agreed to forego legal action against the league and has consented to the sale of the Clippers to former Microsoft CEO Steve Ballmer, according to Ramona Shelburne of ESPN.com.

The likelihood of Sterling following through on the threat of a lawsuit took a hit last Friday, when Sterling's wife, Shelly -- as part of the formal sale agreement with Ballmer -- agreed to "indemnify the NBA against lawsuits from others, including from Donald Sterling," according to an official release. That Sterling himself is cooperating with that claim, however, is a significant development that will facilitate his impending removal from the NBA. According to Sterling's attorney, Max Blecher, the decision to drop the lawsuit against the NBA was part of a larger deal in which the NBA also agreed not to sue Sterling in return, per Shelburne.

The charges of Sterling's planned lawsuit's charges would have included an invasion of Sterling’s constitutional rights, violation of anti-trust laws and breach of fiduciary duty associated with the NBA’s lifetime ban and termination charges. Blecher also clarified that the prospective suit had nothing to do with the sale of the Clippers.

Under the agreement announced last Friday, Ballmer will purchase the Clippers from the Sterlings for $2 billion, pending a vote from the NBA's Board of Governors. The NBA then terminated its charge to remove Donald and Shelly Sterling from ownership and canceled its June 3 meeting to oust the Sterlings from ownership.

Earlier that day, TMZ.com reported Donald Sterling had recently been diagnosed with Alzheimer’s disease. Sterling was diagnosed by doctors in early May, which led him to be declared “mentally incapacitated” – a determination that removed him from power over the Sterling family trust and, by extension, the Clippers. That left Shelly Sterling as the sole functional trustee, a status which fully empowered her to carry out the sale of the team.

Ballmer, 58, served as CEO of Microsoft from 2000 until Feb. 2014. He had a preexisting relationship with the NBA after putting in a bid in 2013 to purchase the Sacramento Kings, which smoothed over the vetting process involved in this transaction. Although Ballmer intended to move the Kings to Seattle and rebrand them as the Supersonics, he told the Wall Street Journal in May that he would not attempt to relocate the Clippers in the event that he purchased the team.

“I love basketball and I intend to do everything in my power to ensure that the Clippers continue to win – and win big – in Los Angeles,” Ballmer said. “L.A. is one of the world’s great cities – a city that embraces inclusiveness, in exactly the same way that the NBA and I embrace inclusiveness. I am confident that the Clippers will in the coming years become an even bigger part of the community.”

Ballmer’s net worth has been pegged at more than $20 billion by Forbes, which would make him the richest owner in American professional sports. The $2 billion sale price would set a record for an NBA team, obliterating the $550 million sale price for the Milwaukee Bucks. Only Major League Baseball’s Los Angeles Dodgers, which sold recently for $2.1 billion, have been sold for a higher price.

“I will be honored to have my name submitted to the NBA Board of Governors for approval as the next owner of the Los Angeles Clippers,” Ballmer said in a statement. “I thank Shelly Sterling for her willingness to entrust the Clippers franchise to me, and I am grateful to NBA Commissioner Adam Silver and his colleagues for working collaboratively with me throughout this process.”

SI.com's Ben Golliver contributed to this report.