Simple question on cap and outside payments

[DatWerkk]

(Sorry if this has been discussed before. A couple of searches didn't turn up anything.)

Consider this hypothetical situation. Let's say LeBron plays out his current contract all the way until he becomes a UFA in 2016. Let's also say there are a ton of other FAs that summer (Kevin Durant, Kevin Love, Deron Williams, etc etc) that LeBron may want to play with, but given salary cap restrictions, no team is sure they can sign more than a couple of these high-dollar superstars.

So let's say the following goes down. Kevin Durant signs with the Heat for the maximum or close to it. Another FA does the same. The Heat are owned by Micky Arison, one of the richest men in the NBA and CEO of Carnival (the cruise company). Micky Arison gets LeBron to sign a hugely discounted contract. Let's just say it's only about 50% of what he could get on the open market. In exchange, Arison signs LeBron on to be a spokesperson for his OTHER company. He pays him $12-15 million a year for his spokesperson duties. The Heat stay within the cap and have enough money left over to fill out their roster.

What's to stop this from happening? I feel like this probably has a simple answer, but I don't know what it is. Any help?

[answerthink]

That’s considered circumvention, which is a violation of the collective bargaining agreement.

But your thought process, insofar as it relates to the Heat, is awesome.

[DatWerkk]

That’s considered circumvention, which is a violation of the collective bargaining agreement.

But your thought process, insofar as it relates to the Heat, is awesome.

Well I'm a Hawks fan, so this would lead me to drink heavily. But I digress...

Wouldn't you have to prove intent to accuse them of circumvention? Maybe in my example intent would be easy to prove, but what if instead LeBron only took a small paycut (but was still making big dollars from Carnival)? How could the league prove that that wasn't a legitimate non-basketball-related business transaction?

[DBoys]

How could the league prove that that wasn't a legitimate non-basketball-related business transaction?

The fact that there is an affiliation between the Heat and Carnival, all by itself, would call into question any income Lebron is offered from the cruise line. And in the situation you described, the "smoking gun" would be the heavily discounted NBA contract.

In addition, the NBA wouldn't have to go to a court and prove things to a judge or jury in order to destroy the team for such actions, so an owner would tend to steer clear of such actions to keep from putting a target on his chest. In a situation like you describe, there's an assumption of guilt because of the affiliation, and in circumvention cases Stern has the latitude (including precedent) of imposing just about any penalty he deems appropriate.

[Dunkenstein]

and in circumvention cases Stern has the latitude (including precedent) of imposing just about any penalty he deems appropriate.

Or Adam Silver, who will be the new fuhrer in 2016.

[DatWerkk]

Fair enough. I figured it might be something like that, some sort of "guilty until proven innocent" type of thing. Thanks for the responses.

[DatWerkk]

Did I say LeBron? I meant Kirilenko.