Washing Up the Clippers' Punishment, with Henry Abbott

Pablo Torre Finds Out

Pablo Torre and former ESPN editor Henry Abbott dissect the controversial NBA investigation into the LA Clippers' financial dealings with Ka

Key takeaways

• ESPN's August 2023 article claiming 'no evidence' of Ballmer funneling money through sponsors mischaracterized the Wachtell report and was likely influenced by a targeted PR campaign from the Clippers.
• The Clippers' legal team, including high-level communications executives, actively shaped media narratives to downplay wrongdoing, even as internal documents showed clear intent to circumvent salary rules.

Main topics

• ESPN's misleading reporting on the Clippers' financial scandal
• Steve Ballmer's alleged role in circumventing NBA salary rules

Notable quotes

"When they say no evidence, Henry, this whole thing has evidence in it. We have provided evidence."

"It's very unusual that people have a secret backroom deal and that the person who gets the proceeds of that isn't in the backroom."

Conclusion

The episode reveals deep skepticism toward both media narratives and team PR efforts, arguing that the

Transcript preview

Speaker 3 (0:00) Welcome to Pablo Torre Finds Out. I am Pablo Torre, and today we're going to find out what this sound is. Does that not expose Speaker 2 (0:07) T. Ballmer as a liar? Right after this. Speaker 3 (0:17) I want to get to the whole, like, sweep of this story, but through your brain, Henry Abbott. And thank you for coming back and vibrating with a similar level of excitement. I want to have you here and have you ask me questions. And I will do my best to also pose, I think, questions that have not been said otherwise. And I don't want to call this a mailbag. It's not what this is. This is not a mailbox. Yeah. Despite it being shiny. Not a mailbox, your skull. I do also want to say that this story is unfolding in the sort of... Fun house mirror way in which I go to the newsstand this morning because I support print journalism. And I pick up a copy of the Wall Street Journal. And I flip to my favorite section personally, which is the opinion section. Because I am fiscally conservative, famously. For sure you are. And this is the headline in one of the... Oh, I love that. Pablo Torre 1, Speaker 2 (1:20) Mark Cuban 0. I just want to know. What got boxed out of the op-ed page Speaker 3 (1:27) in this morning's Wall Street Journal? No Speaker 2 (1:28) Bitcoin today. Yeah. Somewhere Scott Besson is furious. But this Speaker 3 (1:33) is the sort of strange, I would say, realignment that's happening now. Speaker 2 (1:38) It is. Well done. This is actually wrong, though, because it's for sure Mark Cuban minus one. I re-listened to it with an uncharitable heart and feeling a little prejudgy about Mark Cuban, who I found to be kind of overbearing and annoying in Speaker 3 (1:51) his Speaker 2 (1:51) conversations with you. Speaker 3 (1:52) No. Speaker 2 (1:52) There was a part where you said, yeah, but they didn't advertise any of these deals. And he just lost himself with how much you don't understand about business and activations and business to business and direct to consumer and all this just horse shit. But then in the Wachtell report, they're just like, oh, they never activated, which makes no sense. And now Mark Cuban's publicly like, hey, good job, Pablo. It's like, oh, because Wachtell said it. Now it's real. It was obvious a Speaker 3 (2:16) year ago. Speaker 2 (2:17) And that's the Speaker 3 (2:17) kernel of why we're talking. Yeah. What did we learn from the Wagtail report? What is yet to be discussed? How do we explain what is, by any reasonable metric, the largest punishment in NBA history and in contention for what is, depending on how you tally up the $30 million that Ballmer has been fined plus the year. suspension that he has from his own building, plus Gillian Zucker, president of business, a year suspension, Lawrence Frank, president of basketball, six months, five first-round draft picks, according to Ballmer's letter to Adam Silver, in which he is threatening litigation. There's a lot happening here. That's a $50 million legal fee to the aforementioned Wachtell, Lipton, Rosen, and Katz, which has helped save long-form writing, as you have the stack in front of you. That's a lot. So where should we start in the timeline here? Because people have been coming to me, and I love that they are coming to me with questions on the back of the report. But as you say, we've been at this, and there's so much more. And even Wachtel also Speaker 2 (3:20) says, Speaker 3 (3:20) there Speaker 2 (3:21) is so much more. Well, you and I spoke recently on the phone, and I was impressed by the howitzer of like... unpublished information that resides within you. And so I feel my job here is to open some of those portals and just let it go, right? As my former editor Speaker 3 (3:36) at Speaker 2 (3:37) ESPN, this Speaker 3 (3:38) is a very funny conversational dynamic that you've just described, given the larger dynamic that we're about to get into. We're good. We're going to fill the hour, no problem. This is what I'm very confident about. Speaker 2 (4:06) So first thing, let's talk about the ESPN article, right? So August 17th. Don Van Natta, Baxter Holmes, Ramona Shelburne, people that you and I used to work with and know well and respect, published a story that began, the NBA has found no evidence showing LA Clippers owner Steve Ballmer funneled money through team sponsors to pay Kawhi Leonard in order to circumvent the salary cap, according to three people with knowledge of discussions between the two sides. And then there was a later paragraph that said, talking about Boingo and Daktronics, it said, but like aspiration. There's no evidence that Balmer funneled money through these companies. And how does that sit with you now? The question that I get asked most Speaker 3 (4:47) often is along these lines. How did we go from the public interpretation being Steve Innocent, no evidence, to... There were four companies that he was doing parallel schemes with to circumvent the salary cap. And here is 35 pages of evidence in addition to our 14, then 15, now 16 part series on this thing. And I think people need to understand that when we've been reporting the story on this show, we have been interviewing lots and lots of people, human sources, who've been extraordinarily clear from the start what this was, including in a federal whistleblower complaint. filed in 2023 under penalty of perjury. And so I remember where and when I read the ESPN story, because this is embarrassing for me personally, I was in the shower. Oh, that is Speaker 2 (5:37) a little weird, yeah. Speaker 3 (5:38) I'm Speaker 2 (5:38) a Speaker 3 (5:38) guy who sometimes needs to glance at his phone for journalistic reasons while I am, I guess, cleaning myself. Speaker 2 (5:45) I'm not going to say I've never done that, but I've never talked about it in such a public forum before. I regret doing this already, but I want to be very detailed Speaker 3 (5:53) and transparent about how this article ended up cleaning the reputation, it Speaker 1 (6:01) seems, of Speaker 3 (6:02) the richest owner in American sports. And when I look at what that headline was and what is implied, I just want to say the framing of this. That's the thing that's crazy to me. What this was in retrospect, according to my reporting, as well as the Wachtell report, was the Clippers' legal case in response to these findings presented as if these were the findings. And so when they say no evidence, Henry, Speaker 2 (6:34) this whole thing. has evidence in it. We have provided evidence. Speaker 3 (6:40) From the first episode. I just feel like how could anybody say there's no evidence? The framing didn't pass the smell test to me. And I say that also because ESPN did not reach out for comment from me before they went with the story. Afterwards, I submitted a comment that said, effectively, we stand by our reporting. We look forward to the NBA's ruling. Our investigation continues. That wasn't included for whatever reason. But what I can tell you is that the Clippers, behind the scenes for a year, have been mounting an aggressive PR campaign through their head of public relations, Chris Wallace, who is the comms guy across everything who reports directly to Steve Ballmer and Gillian Zucker and Lawrence Frank. He's a C-suite level guy with relationships throughout the league. He is very active on the internet. He used to work at the league. He's a guy that people know. Yeah. And then they also, and this is important as well, hired a crisis PR person whose job was to shop around the most exculpatory version of events to reporters. And I just would like to point out that this ESPN story was not the first time they got the framing of the story wrong. This was the through line of how they saw this from the start. And they were not alone. And I want to be generous insofar as I say, I think. according to my reporting. And according to the Clipper statement, Henry, which was released within an hour of the ESPN story coming out, and the Clipper's statement was again a recitation of what in retrospect seems to be their legal case. This is about failure to supervise, which is bullshit. This is about no evidence, which is now we can tell. Bullshit. That was something that they fed to these reporters, our former colleagues at ESPN. while the Clippers themselves knew that this was not it. There was more. And I think, according to the reporting, that the ESPN story was a bit of information asymmetry. And I would imagine that if I'm one of those reporters, I would be furious. that this is how we were sold a bill of goods and it ended up being, in fact, based Speaker 2 (9:02) on the evidence, the opposite of the way it was framed. It's clever because I don't think these are reporters who would just write what they were told to write. They're reporters. Speaker 3 (9:11) And Speaker 2 (9:12) there is insidery stuff in that story, right? They had some real sourcing about these meeting between Rick Buchanan of the NBA and David Kelly, who's Ballmer's attorney. Speaker 3 (9:22) David Kelly is his attorney at O'Melveny. Ballmer's personal attorney. David Kelly, also different David Kelly, head of the NBA Speaker 2 (9:29) Players Association. And isn't one of them like a movie producer? Isn't there a movie producer, David Kelly? We're in the David Kelly universe. I'm surprised how the NBA handled this too, though. I mean, you and I have both been part of many stories where you check in with NBA PR about something sensitive, and there's a whole menu of ways they might respond. Often it involves yelling and four-letter words and belittling your personality and this kind of stuff. But this was a new one for me where they... You know, with three top known national writers. Yeah, and Sham Sharania also contributed reporting to this thing. I think it was five, Speaker 3 (10:00) really. Bobby Marks, another guy. Former Nets executive, yeah. Who worked with Lawrence Frank. Oh, good point. When he was there. The Clippers web of connections through their front office, which, by the way, their front office is massive. Yeah. It's not just the comms guy. It's not just the crisis PR guy they hired, who I will get to at some point in this series. Let's do it. Because the crisis PR guy is so fascinating to me because these are the sort of dark arts dudes who spin behind the scenes that are called in for these campaigns. But the point is, even outside of that, they have lots of friendships and relationships. You listen to all of the other ESPN reporters, and they tell you Brian Windhorst, who I also respect and have worked with for years, what he says is that Clippers officials looked him in the eye. Oh, Speaker 2 (10:47) they got him in the eye. Now we're good. Right in the... Right in the windhole, yeah. That was inappropriate. Speaker 3 (10:57) Brian, I apologize for... Your former editor. That's on me. That's on me, Ryan. Speaker 2 (11:01) But Speaker 3 (11:02) they looked in the whites of these reporters' eyes and said, there's nothing here. In fact, this dumb podcast has it backwards. That's what the implication of that story was. And so, look, why did it happen? And what does it say? It happened because there was clearly what the article, this part of the article. I think might have had the most important word in it. It was spirited. Rick Buchanan. Speaker 3 (11:36) David Kelly, Balmers David Kelly, spirited discussions, negotiations even, around what this was. And as soon as that article came out, what you discerned was that the Clippers and the NBA are in fact fighting right now. And so why do they handle it this way? Speaker 2 (11:55) It's Speaker 3 (11:55) because for the first time in public view, Henry, As I calibrate my cynicism, the Clippers and Adam Silver's league office and Wachtell Lipton were on opposite sides of this dynamic. And their incentives were not aligned. And that spilled out