The Donald Sterling Dilemma

By Anthony R. Caruso, Special forUSDR

Recent comments made by NBA team owner Donald Sterling has left many wondering what could
be next in this media nightmare. Serious questions have been raised regarding whether or not the
NBA possesses the legal authority to force a sale of the team now that Donald Sterling has been
banned from any involvement with Los Angeles Clippers.

Despite reports to the contrary, as a private, self-governing organization, the NBA has every right
to take action to force the ownership to sell the Clippers. Following the affirmative vote of three
quarters of all owners, the NBA can in fact force Sterling to sell the team and need not allow his
spouse to remain an owner. If Sterling chooses to fight the NBA’s actions, he will likely have a
lengthy legal battle ahead of him. While Sterling will be entitled to receive fair value for the team,
he would, nevertheless, eventually be ousted from ownership.

Perhaps one of the most hotly debated topics amidst this controversy is whether the NBA
Constitution supersedes local law. As a condition of owning a team, NBA owners must agree to
the rules set forth in the NBA Constitution and By Laws. Sterling agreed to each of the league’s
terms and conditions, including the right of the Commissioner to punish team owners for
violations, and the right of owners to vote a colleague out of ownership should the situation at
hand justify such action.

Article 13 of the NBA Constitution allows for termination if the League was somehow “adversely
affected” by the individual owner’s actions. With players threatening to boycott and sponsors
dropping their support, it would be difficult to argue that the NBA and its members have not been
adversely affected by Sterling’s actions. As a result, fining and subsequently banning him is likely
within the League’s authority.

While Sterling made a number of crucial mistakes in his crisis management approach, his recent
interview with Anderson Cooper on CNN was perhaps the most fatal blow thus far. Although
Sterling’s initial intentions may have been sincere, his delivery had an entirely opposite effect.

As attorneys in a crisis management situation, we would first advise our clients to act immediately
in offering a public apology for their actions. During that apology, we would recommend that
counsel be present, in order to prevent any self-incrimination from occurring. Lastly, we would
ensure that our client, before appearing on national television, was better prepared to address the
situation at hand.

Had Sterling taken the appropriate steps necessary in attempting to salvage the situation, he likely
would have found himself in a better position.

Anthony R. Caruso is a partner at Scarinci Hollenbeck with offices in New York City, New Jersey
and Washington DC. He serves as Chair of the Sports and Entertainment Department and is on
the adjunct faculty at NYU. Brianne Kovach is a second year law student at the University Of
South Carolina School Of Law.

All opinions expressed on USDR are those of the author and not necessarily those of US Daily Review.

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