Will Kawhi Leonard Become a Free Agent? 29 NBA Teams on High Alert Amid $28M Aspiration Controversy

Salary cap circumvention, as laid out in Article XIII, Section 1(b) of the NBA’s Collective Bargaining Agreement, basically happens when a team finds a sneaky way to pay a player more than his contract allows. Usually, this involves a third party like a sponsor or business partner stepping in to cover extra payments that go beyond the legal limits.

If the money paid is way above fair market value while the player’s contract itself is below market value, that’s where the NBA steps in. One common example could be giving a player a cheap contract now but secretly planning to pay him big later using Bird Rights, or setting up endorsement deals through companies tied to the owner. The league watches this closely because it gives teams an unfair advantage, but proving it is actually pretty rare.

To understand how strict the league can be, there have been a few notable cases over the years apart from the Joe Smith situation. Back in 1993, the NBA questioned the Portland Trail Blazers over a seven-year, $11 million contract they gave Chris Dudley, which included an unusual opt-out after the first season. At that time, a player could gain full Bird Rights with a new team after just one year, meaning Dudley could’ve opted out and re-signed for way more money above the cap.

However, the deal was upheld in arbitration since Dudley got injured and never used the opt-out. Then, in 1996, David Falk, Michael Jordan’s agent, reportedly explored a plan for Jordan to sign with the New York Knicks. Since the Knicks and Sheraton Hotels were both owned by ITT Corporation, the idea was allegedly to supplement Jordan’s salary with a $15 million endorsement deal from Sheraton, bypassing the salary cap.

But no primary NBA documentation confirms the plan’s details or that it was formally investigated. Jordan re-signed with the Chicago Bulls in 1996 for a one-year, $30.1 million contract

Fast forward to today, and the penalties for salary cap circumvention depend entirely on the type of violation. For a Section 1 violation, the NBA can fine up to $4.5M for a first offense, $5.5M for later ones, void contracts, and even take away a first-round pick.

But a Section 2 violation is much harsher—fines up to $7.5M, suspensions up to a year, voided deals, and loss of draft picks with no set limit. Basically, the punishment for the Clippers will depend on what the ongoing investigation uncovers.

Speaking of the Clippers, this isn’t their first time being linked to these kinds of issues. Back in 2015, the team was fined $250,000 for offering DeAndre Jordan an unauthorized $200,000-per-year Lexus endorsement deal, just months after Steve Ballmer bought the franchise.

As for Kawhi Leonard, neither he nor the Clippers have ever been proven guilty of salary cap circumvention, but the rumors have been around since 2019, when Kawhi signed his three-year, $103M deal.

Reports claimed his uncle, Dennis Robertson, allegedly asked teams like the Lakers and Raptors for benefits well beyond league rules, things like part ownership, a private jet, a house, and guaranteed off-court endorsement money.

The NBA looked into those allegations but found no evidence linking the Clippers to any wrongdoing. Then, in 2020, a man named Johnny Wilkes even sued the Clippers and Jerry West, claiming he was promised $2.5M for helping land Kawhi. That lawsuit was eventually dismissed in 2022, but the league made it clear it would reopen investigations if new evidence ever surfaced.

The Clippers, however, have consistently maintained their innocence. In a statement to Pablo Torre, the team said that neither Steve Ballmer nor the organization engaged in salary cap circumvention or any misconduct involving Aspiration, calling all claims “provably false.”

Interestingly, former Mavericks owner Mark Cuban also weighed in on social media, siding with Ballmer and writing that he’s “Team Ballmer.” Cuban argued that Steve Ballmer is “not that dumb” and questioned why Ballmer would risk everything only to have the company go bankrupt, making everything public anyway. Kawhi Leonard, meanwhile, has not made any public comments on the situation yet.