Leagues Might Now Have the Formula for Removing Problematic Owners
As 2022 wraps up, SI staffers Jon Wertheim and Chris Almeida will discuss some of the themes of the year in sports. So far, they've covered sportswashing and what did (and didn't) change during a wild year in college sports. Up today: how leagues, in 2022, seemed to figure out how to push out problematic owners without a direct vote.
Chris Almeida: So this year has been quite a weird year for sports owners. Last November, ESPN published a story that revealed years of misconduct and pretty galling racist and sexist behavior on the part of Robert Sarver. And at first it seemed that maybe he would just get away with it, as the mega rich often do. The NBA spent about 10 months investigating Sarver and then announced in September that he would receive a one-year suspension and a $10 million fine.
But clearly the official punishment wasn’t the only lever that Adam Silver was using here. Because within a week of the punishment coming down, Sarver announced that he was looking for a buyer for the Suns and the Mercury. Over in football, Dan Snyder after years and years of creating a toxic workplace and antagonizing his team’s fans and just generally giving off the vibe that he’d rather die than admit wrongdoing seems to…maybe be moving toward what always seemed impossible: selling the Commanders.
I'm still not totally convinced that he's going to do it, but he hired Bank of America to explore a sale. That’s a sign that, if nothing else, the pressure is getting to him in a way that it hadn’t before. Donald Sterling getting booted in 2014 was obviously a big paradigm shift in owners (sort of!) having consequences for their actions. But these situations are a little different from that. Do you think something has changed this year?
Jon Wertheim: Yeah, I mean, fundamentally, this gets to the question of: what is a league? Is it a single entity, or is it a collection of individual teams? The Sterling case was so outrageous and untenable. It was so beyond the pale that Adam Silver could do what his predecessor chose not to and basically flex his muscles and say: You really want to challenge me? Go ahead. He basically demanded a sale. Most leagues require three quarters of the other owners to vote if they want another owner out. But these guys are sort of all in a club. And so there's a real fear of precedent. Even with Sterling, Mark Cuban said, essentially, this guy is repugnant, but we really need to be careful here. It's by the precedent we're setting if we're allowing these private businesses to be stripped of their ownership rights.
So that’s part of this. Another part is that these franchises are wildly appreciating in value. (On Tuesday, it was announced that the Suns and Mercury would sell for around $4 billion.) Robert Sarver, we may have our feelings about him, but he's gonna be fine when he sells this thing. So, yeah, I think that is a factor in this but I think what we're seeing is that these leagues have figured out levers that they can pull that don't necessarily force a sale, but can make these problematic owners want to sell.
Certainly a big part of forcing a sale is seeing the players turn against the owner in question. When Chris Paul and C.J. McCollum and LeBron and the Players Association speaks out against a particular owner, that's something that hasn't been in the marketplace. That’s something that can send a message to sponsors and create even more pressure. We see, whether it's FedEx or whether it's Footprint in Phoenix, that when the sponsors start to pull out, that becomes a problem. I think that with Sarver and Snyder, we’ve seen that these leagues have figured out how to go right up to the line of a forced sale without going over it. Three quarters of the owners having to demand a sale, that's gonna be hard because these guys are looking out for each other and also themselves. But I think this is the year leagues have perfected the fine art of making life miserable for the undesirable owner.
CA: Yeah, I mean, the Snyder situation is interesting, because obviously even compared to his peers, he's legendarily stubborn and vindictive. But what they basically did is they waived the cap on the amount of debt that he was allowed to take on and let him make the situation unsustainable for himself. They basically put the cinderblock around his leg and then let him throw himself into the river. That strategy accomplished that direct pressure may never have done.
JW: I had an owner once tell me that they don't necessarily mind these guys because it means one less team, one less franchise to worry about. Donald Sterling was a terrible person, but he also wasn’t paying lavishly. He depressed wages. His team was awful. For years and years and years, all the other owners not only could count on a win against the Clippers, they didn’t have to compete against them in free agency either. The guys the owners hate are the Steve Cohens who come in and pay players a lot and change the labor market.
Anyway, so these guys don’t want to take a vote because what was Snyder’s line? “They can’t f— with me.” And in this way, they don’t have to. They don’t have to worry about lawsuits. They don't have to worry about these scorched earth tactics. You basically pull the right levers through players associations and sponsors and changing debt limits. And any rational human being then looks at their situation and says, “You know what, I'll take my money and go.”
