Dino-Might wrote:When I am preparing for a file, I often have a working theory of the case that I adjust based on any new information I get. Some of it starts out as speculation without evidence, just based on inferences and my gut. I focus my research on those areas to see if I can find evidence to support or rule out my theory.
I would like to share my current working theory of the Kawhi situation. Disclaimer: much of it is wild speculation on my part with no evidentiary foundation; just a theory worth exploring and testing.
Back in 2019 when Kawhi was a free agent, he and Uncle Dennis were talking to three teams, Lakers, Raptors and the Lakers. Based on the reporting out there, it sounded like Kawhi was trying to get the teams into a bidding war. He was asking the Raptors for at least $10 million per year in endorsements where he wouldn't have to do anything, part ownership in the Toronto Maple Leafs, and other improper benefits (use of company jet, etc.). He also asked them to trade for Paul George. The reporting from the Lakers was not as detailed but it was suggested Kawhi had also made similar improper demands from Jeannie Buss as well, including ownership stake in the Lakers, guaranteed endorsement $ and a house.
Given Kawhi's reputation for being a miser, it would be difficult to imagine that he and Uncle Dennis did not also ask Clippers and the NBA's wealthiest owner Ballmer for similar extras back in 2019. Coming off a Finals MVP and Championship, Kawhi had all the leverage in the world and Ballmer was desperate to get him. The Clippers did meet Kawhi's demand for Paul George, at great cost to the team. Why wouldn't Uncle Dennis be asking for extra endorsement dollars and investment opportunities? In fact, Kawhi would be leaving extra money on the table by leaving the Raptors, who had the ability to give him a longer, more lucrative deal. Would Kawhi not at least ask Ballmer to make up that difference?
Here, there are two possibilities of what happened next. The first possibility is that the Clippers did in fact give him extra money through endorsements and secret side deals that was never discovered, despite the NBA's investigation. In fact, the only reason we found out about the Aspiration deal was because it went bankrupt, basically through sheer luck (not to take anything away from Pablo's great work).
I have some questions with this first option. If the Clippers had a secret arrangement that worked in 2019, why would they need to recruit Aspiration, two years later to facilitate the cap circumvention? Couldn't they continue using what was working? Secondly, if Kawhi was happy with his arrangement in 2019, where he was getting the extra $ and investments he had asked for, why did he ONLY sign a 2+1 deal in 2019? Given his injury history, it was widely expected that he would sign a 4-year deal $141 million deal with the Clippers and everyone was shocked when he only signed a 3 year deal for $103 million with a player option in the third year.
My primary theory here is that there was a handshake agreement made in 2019 when Kawhi signed, for such extra benefits. However, it takes time to enlist a shady, unrelated company to secretly funnel money for you. So the arrangement was not in place when Kawhi signed. This may explain why Kawhi took a 2 +1 year deal, instead of the longer 4 year deal that everyone expected. This would allow Kawhi to keep Ballmer's feet to the fire to make sure Ballmer kept his word within 2 years.
Once NBA launch an investigation in or around the Summer of 2019 about the circumstances of the Clippers deal, there as too much heat for the parties to proceed. They waited until after the investigation closed without finding any wrongdoing. By the time he opted out of his contract in 2021, he would have expected Ballmer and the Clippers to fulfill their end of the bargain by delivering the extra benefits that had already been discussed.
By 2021, after two injury plagued seasons, Kawhi had far less leverage than he had back in 2019 so it made less sense for Ballmer to offer him such benefits for the first time. Kawhi didn't have anywhere else he could go for the max.
However, the Aspiration deal makes sense if Ballmer was simply honouring an agreement that was already made back in 2019.
And they would have gotten away with it, except for the little fact that the type of companies that are willing to take money to help you illicitly and secretly funnel money are also the same type of companies that may defraud their investors, end up under government investigation and end up going bankrupt. Ballmer's defence seems to be that he was a victim, that he was defrauded. Sounds like this is true. Ballmer gave Aspiration $50 million from his personal LLC, presumably on the basis of a promise that they would divert $48 million of it to Kawhi.
What Ballmer did not know at the time was that Aspiration was not a viable company, had no real revenue source, and was simply borrowing money against its own equity in order to create the illusion of revenue and investments.
When Aspiration stopped being able to pay Kawhi the money Ballmer had provided for such purpose, Kawhi and Uncle Dennis were likely pissed. All they knew was that they had been promised this money by Ballmer as a condition of Kawhi joining the Clippers and it was not being honored. At that time, in 2022, Kawhi was coming back from injury. I have seen the speculation that Kawhi and Uncle Dennis were shaking down the Clippers and refusing to play games unless they were paid what was owed to them. The Clippers minority owner Dennis Wong had to invest $2 million in Aspiration, at a time when they were on the verge of bankruptcy, so that Kawhi could get paid his 1.75 million installment.
The latest report was that Ballmer then had to put in an addition $10 million in March 2023 to try to keep Aspiration afloat.
So it is true that Ballmer was defrauded. He gave them $50 million to pay Kawhi but had to put in extra millions more just to keep the payments flowing, until the company finally went under, leaving him to deal with the aftermath when their list of creditors went public.
Thoughts? Weaknesses? I'm open to feedback.
I got to a similar conclusion, but I am not ruling out that the possibility that the Aspiration deal was there to replace another under the table deal, reached in 2019, that in the meantime expired.
Moreover, the 2+1 was not that weird of contract, Kawhi could opt out as a 10 year veteran, demanding 35% of the cap. Given how much the Clippers had to invest on him, it did make sense to think they were pot committed anyway.
