In depth: Stern fires shot across the bow at the Maloofs, who continue to threaten the NBA’s billion dollar arena subsidy

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A meticulous planner, everything David Stern says is run through a filter of lawyerly instinct and an ever-present awareness of his surroundings.

So when David Aldridge asked him if the NBA would support the Maloofs in their desire to move the Sacramento Kings to Anaheim on Tuesday – don’t think for a second that he hadn’t weighed the legal gravity of the situation or the wishes of his 29 other bosses.

“If there was a vote now, there would be no support for a move,” Stern said.

Stern then went on to poke at the Maloofs for their current plan, which includes staying in the nearly dilapidated Power Balance Pavilion for at least one more season, despite the family threatening to leave town for years because the building is dilapidated.

“That’s their prerogative. As long as it (Power Balance) stands and passes the fire code, I think it’s been a terrific place for the fans of Sacramento,” said Stern in his typical dry wit.

This is the most recent play on the NBA’s relocation chess board, and with the Maloofs overtly implying an antitrust lawsuit against the league for well over a year now, it’s a telling one.

Antitrust suits have been the weapon of choice for owners looking to find greener pastures, and though case law provides limited guidance for courts, it has generally been a favorable area of law for relocation efforts.

On the other side of the coin lies the ‘best interest of the league’ clause found in most sports associations’ bylaws, including the NBA’s. The bylaws allow for the commissioner to take any action they deem necessary to protect the league, and the league’s preferred association status is tied to the commissioner’s ability to show that ‘due process’ has been provided during disputes amongst owners.

The best way to understand this is to know that the courts generally aren’t going to restrain the trade of an NBA owner. They’re also not going to allow an owner unilateral ability to destroy the league that it operates within as a single entity, and the tipping point is somewhere in the middle. The leagues and courts have already found mechanisms (relocation fees) that allow the individual entities impacted by a move to be indemnified to a certain degree.

In the case of the Maloofs’ attempted move to Anaheim, sources with knowledge of the situation have reported that a relocation fee would be upwards of $300 million.

In this case, there are two injured parties in L.A. that would disapprove of the Maloofs’ desire to move into their market, but the more pressing issue for all of the NBA’s owners is what the Maloofs are doing to impact the integrity of the league’s billion dollar arena subsidy.

Since 1990, the NBA and its players have enjoyed a $3 billion public subsidy toward arena costs.

In April, the family backed out of a deal that as anchor tenants required them to pay $73 million toward a $391 million facility – $67 million of which would be provided by the NBA in the form of a loan. George Maloof called it a “good deal,” Gavin Maloof cried tears of joy after the parties emerged from an Orlando hotel room heralding the deal during All Star Weekend, and both Gavin and brother Joe held Sacramento mayor Kevin Johnson’s hands in triumph at the Kings’ next home game.

All of it was a ruse, though. It became clear that the Maloofs had no intention of striking a long-term deal with Sacramento when political crisis consultant Eric Rose was brought on by the family to handle its media strategy, and their antitrust attorneys began sending threat letters to the city that were designed to disrupt its ability to deliver on a tight timeline. Then came the ridiculous requests and demands, and the confidential communications between the family and the NBA eventually were leaked to a Sacramento website that opposed the arena deal.

Eventually, the Maloofs would burn most of their bridges in Sacramento in what Stern would describe later that day as “not the weirdest press conference we’ve ever had.” They hired an economist that twisted enough facts for Stern to say he acted in “ill grace,” and their antitrust attorneys pitched against Sacramento over PowerPoint. With only the Sacramento media allowed in their New York hotel conference room, George Maloof went on a wild tirade that made their economist Chris Thornberg look like a beacon of truth.

The NBA, who was authorized by the Maloofs to represent them in negotiations, thought the deal was fair, but the Maloofs expected to pay nothing and control all of the revenue streams in Sacramento. They expected this because of Anaheim’s long-standing offer to bring the Kings down south. Billionaire Henry Samueli and Anaheim’s city council’s offer to provide cash relief to the family would theoretically allow them to continue operating the team while making big market TV money, with the fallback position of selling the team for more than they could in Sacramento due to the larger market.

But that didn’t account for the minimum $300 relocation fee that the Maloofs or any subsequent owners would have to pay to infringe upon the Lakers and Clippers’ markets, making the deal untenable for the Maloofs if they wanted to keep the team. If their plan was to sell to Samueli or another Anaheim group, the relocation fee would certainly be a big nut for the new owners to take on in addition to the price of the franchise, not to mention a huge deterrent if the new owner senses they’re not wanted by the league.

It has been theorized that this relocation fee was communicated at some point to the Maloofs, who expected to leverage (or take) Anaheim’s offer despite being near the finish line with Sacramento. In that theory, once the Maloofs realized a move to Anaheim was not in the cards they decided to officially muck up a Sacramento deal that reflected their meager contributions, while testing their leverage with antitrust threats.

Regardless of the Maloofs’ intentions, cities that negotiate with the NBA and team owners over arena subsidies will now point to the family’s apparent bad faith dealings. Now, the league will have to explain to its civic partners how and why they should expend political capital and public funds if owners are going to use the scorched earth strategy when they don’t get what they want.

Sacramento spent significant sums of money and staff time in the arena negotiations process during a budgetary crisis only to find they were spinning their wheels – all while offering to pay for 65 percent of the arena’s costs – and the NBA is going to have to wear that issue unless they make it right by keeping a team there under a workable plan.

The timing couldn’t be worse for the league, either, with the Oklahoma City Thunder in the Finals just four years after Stern, former Sonics owner Howard Schultz, and now Thunder owner Clay Bennett stole 41 years of Sonics history from Seattle because the local government wouldn’t pony up. The government there certainly shoulders some of the blame for how that went down, but as the documentary Sonicsgate so handily points out – the principals on the NBA’s side had agendas that aren’t exactly ringing endorsements for the league.

Even if the league somehow makes things right in Sacramento and Seattle, this pulling back of the curtain could shave millions, if not billions of dollars off the NBA’s bottom line if not handled correctly by the owners. Municipalities are going to have a harder time convincing voters to part with tax money as the subsidy shakedown gets exposed, and arena funding campaigns will be forced to seek lower funding amounts as local voters lose their appetite for unsavory business tactics.

Whether it’s in the best interest of the league’s balance sheet, or the best interest of the league’s PR efforts, the Maloofs are killing the association on both fronts.

With Sonicsgate discussion now creeping into the national discourse during the Finals, we saw the first signs on Tuesday that the owners aren’t going to let the Maloofs throw the baby out with the bathwater. By stating publicly that the Maloofs have “no support” for a move to Anaheim, the league has all-but invited the Maloofs to pursue their antitrust suit.

Namely, a decision to not once, but twice inform the family that they cannot move could spawn any number of antitrust damages. If monies or opportunities are lost as the result of the league’s decision to block relocation last year, or if Stern’s public statement this year causes any damages – it adds a yet another critical piece of evidence the family could use when piled on top of the rest of the evidence they’ve been compiling.

This is a decision that does not come lightly, because neither the league nor its owners truly want to face the time and expense of a massive lawsuit like that, nor do they attack their own knowing they will one day be on the other end of the subsidy discussion themselves. At a higher level, the league does not want to see any more case law put onto record that would either weaken its ability to police itself or the various antitrust protections it enjoys. At the top of that list is the ability for the NBA and other sports associations to leverage its limited, monopolistic demand (teams) against cities in the gathering of public subsidy dollars.

Perhaps the league is aware of a solid offer from Seattle billionaire Chris Hansen that nobody out of Sacramento is willing to match, and that is the source of their confidence in saying the Maloofs would have “no support” in moving to Anaheim. Seattle mayor Mike McGinn met with Stern in New York on Monday and Hansen is ready to take on most of the cost of building an NBA-ready arena, assuming of course he can buy a team. That Stern didn’t mention the city in his response to Aldridge is a huge footnote.

Hansen could conceivably justify a higher purchase price than a Sacramento buyer given his land holdings around the proposed Sodo arena site, and the fact Seattle is about 30 percent larger than Sacramento in terms of its TV market. But those advantages are somewhat mitigated by the fact that a Seattle team would have to compete with both the Seahawks and Mariners for local revenues, whereas the Kings are the only show in town in Sacramento.

That said, saying the league decided to open itself up to antitrust exposure because of a bona fide offer it knows about from Seattle assumes a lot – including Seattle’s ability to deliver on an arena while they face local opposition of their own. It’s way more likely that the league has weighed the Maloofs’ ability to impact the league now and into the future, and it has decided that it’s in their best interests to call the family’s bluff.

If the family still cannot afford to spend money on free agents, and they will be losing significant revenue after spending the last few years biting the hands that feed them in Sacramento – Tuesday’s comments suggest the league has determined that the Maloofs cannot afford to play the antitrust card.

As is the case in most legal disputes, the winner isn’t determined by a judge or jury verdict, but which side has the largest stones and deepest pockets. The Maloofs have a large holding in Wells Fargo which many sources say is untouchable, and outside of that they have a fledgling entertainment business and a partnership to sell (OMG!) cell phone cases.

If we’re buying what the NBA sold us last summer, owning a team isn’t a huge money making endeavor. In reality, it’s a complex issue magnified by being in a small market. And unless you have a way to maximize what a basketball franchise can do, there are plenty of ways to make more from the investment it takes to play in the billionaires’ playpen.

To truly justify owning an NBA basketball team, one has to maximize their various holdings through cross promotion, invest in the areas around the arena, and maximize tax breaks before selling at an appreciated gain one day. To do this it takes a minimum level of free agent spending to field a team that will generate revenues to make that work.

The Maloofs don’t have the money to be that type of owner, at least anymore.

The Maloofs once had designs on maximizing the values of their holdings in the Palms and their entertainment empire, but the entertainment empire never panned out and the Palms is no longer theirs. Sacramento gave the family some proximity to help with the promotion of both entities, but now that bridges have been burned there, the only other destination that would supplement what is left of their non-NBA holdings was just rejected during Stern’s press conference.

Elsewhere, Seattle billionaire Chris Hansen isn’t going to build an arena so ‘the boys’ can play around in it, and even if the other cities that have expressed interest in the NBA can offer a sweetheart deal to them, they can’t significantly change the Maloofs’ cash-strapped outlook.

The only plan that makes any financial sense is for them to sell the team to the highest bidder, and with billionaire Robert Pera reportedly paying approximately $350 million for the Grizzlies to keep the team in Memphis and Tom Benson paying $338 million for the Hornets, it’s possible the Maloofs can top the $400 million mark on their way out the door.

Sacramento’s TV market is double the size of both Memphis and New Orleans, and it’s certainly plausible that Pera made an offer to the Maloofs given his Northern California roots. That Pera wasn’t able to buy the team from the Maloofs (or didn’t try) could speak to any number of issues, but finding a price point that would entice the Maloofs to sell is the NBA’s best bet at ridding themselves of their billion dollar subsidy problem.

A $400 million sale would provide $172 million for the Maloofs’ 43 percent stake, and with at least $150 million owed to the city of Sacramento and the NBA, every dollar is going to count if the family is seeking a debt-free break.

By chopping off the Anaheim leg of the Maloofs’ leverage play, the NBA is one Space Needle market away from stealing away all of the family’s leverage in a potential sale. Franchise prices in Vancouver, Columbus, Louisville, or Kansas City aren’t going to top what multiple Sacramento buyers are willing to pay, and with Seattle closing in on a viable offer it will soon be time for those buyers to put their last, best offers in, as well.

Stern loves the Sacramento market, the 20th largest market in the country and one that is devoid of competition from other sports leagues. He goes out of his way to praise the city at every opportunity for the job they did getting an arena deal done. But he’ll have a hard time forcing the Maloofs to take a substantially smaller offer to stay in California’s capitol.

It’s a nasty game of relocation chess right now. Milwaukee is next up on the clock with a year-to-year lease, an aging arena, and an aging owner. The NBA will be right back at it demanding a public subsidy, assuming of course they don’t let the Maloofs cook the goose that lays the billion dollar eggs.

As for the Maloofs, they have yet to respond to Stern’s ‘call,’ and it remains to be seen if they continue their bluff all the way down the river.

Report: Kawhi Leonard and Spurs must repair ‘broken’ relationship before San Antonio offers super-max extension

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The Spurs can offer Kawhi Leonard a super-max contract extension – which projects to be worth $219 million over five years – this offseason.

Will they?

Adrian Wojnarowski on ESPN:

The relationship between Kawhi Leonard is broken, and it’s got to be put back together again before the Spurs are going to make that kind of commitment to a player. And that’s going to take a lot of talking, communication and some comprise here in the next few months before the Spurs can make that offer. But the idea that an organization like the Spurs are going to just blindly walk in and give the biggest contract in franchise history to a player who has behaved the last few months like he doesn’t want to be a part of them, it’s not going to happen that way. So, there’s a lot of repairing that’s going to be done before they even make that offer, I believe.

Leonard will reportedly meet with San Antonio for an exit interview, and that’s the next big step toward mending fences.

Remember, LaMarcus Aldridge requested a trade last summer. Then, he and Gregg Popovich talked and got on the same page. Aldridge just had an excellent season for the Spurs. Handling unhappy players is part of the job. When they’re as good as Aldridge and Leonard, it’s worth making the effort to find common ground.

If San Antonio finds enough with Leonard to offer him the super-max extension, the next question becomes: Will he sign it? He might prefer to move on.

But nobody is that far. The big benchmark in this process is the Spurs offering or not offering the super-max extension. They must determine whether or not they will.

Report: Heat to explore Hassan Whiteside trade options

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Is there much demand for Hassan Whiteside around the NBA marketplace?

The pro-Whiteside camp can point to some raw numbers: He averaged 14 points and 11.4 rebounds a game this season (and 17 and 14 a season ago), he shot 54 percent from the floor, and had a PER of 24.1.

However, his shortcomings were on full display in the playoffs. In the first two games, when Philadelphia played small, Whiteside didn’t have a place on the court and saw limited minutes. When Joel Embiid returned things got worse — in the three games matched up against Embiid, when Whiteside was on the court the Heat were outscored by 11.9 points per 100 possessions. Whiteside played just 10 minutes in Game 5, where he was 0-of-4 from the field, picked up three fouls, and was -14. All through the series, Whiteside complained about his lack of minutes.

Whiteside and Erik Spoelstra are not on the same page, and the Heat would like to move him in a trade… but good luck with that. From Barry Jackson of the Miami Herald.

The Heat is expected to explore a Whiteside trade, with the center due $24.4 million and $27.1 million in the final two years of his contract.

In a tight financial market, the Heat are going to struggle to find a team with the space (or willing to create the space) to take on $51.5 million over two seasons. Even if they do, the Heat are going to have to attach sweeteners — multiple first round picks, or a pick and young players that interest teams (Kelly Olynyk or Bam Adebayo, for example). It’s going to be a lot to give up to get out of that contract. Maybe in the summer of 2019, when the market loosens up and Whiteside is an expiring contract, they more easily can find a deal. This summer it would be difficult.

But expect the Heat (and Whiteside’s agent) to look for a trade. It’s time to part ways, it just may not be that simple to do.

PBT Podcast: What went wrong and what’s next for Trail Blazers?

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It was embarrassing, and left both fans and players of the Trail Blazers angry and frustrated — Portland was unceremoniously swept out of the playoffs by the New Orleans Pelicans.

Now what happens in Portland? Is Terry Stotts in danger as the coach? What about GM Neil Olshey? Would they consider trading C.J. McCollum? Is there any way to offload the contract of Evan Turner?

Kurt Helin and the Northeast’s own Dane Carbaugh of NBC Sports break it all down in this latest podcast, and Blazers fans may not like the answers. The pair also touch on other series around the league, like do the Pelicans have a shot against the Warriors? And, as required by NBA law, they touch on the Sixers run.

As always, you can check out the podcast below, listen and subscribe via iTunes at ApplePodcasts.com/PBTonNBC, subscribe via the fantastic Stitcher app, check us out on Google play, or check out the NBC Sports Podcast homepage and archive at Art19.

Pacers head to Cleveland looking to put pressure back on Cavaliers

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CLEVELAND, Ohio (AP) — The Indiana Pacers are in no better position to pull off a historic upset in this first-round playoff series with the Cleveland Cavaliers than when they awoke Sunday morning.

The Pacers had a chance to put the Cavs, at the time reeling with playoff inexperience and the crushing weight of expectations with LeBron James, squarely behind the eight ball in this series by winning Game 4.

But Indiana fell behind by a huge deficit in the first half for the second consecutive game, erased it in the third and early fourth quarters again, but couldn’t sustain the momentum. Kyle Korver and James made enough plays down the stretch for the Cavs to win, 104-100, tying this series at 2-2 with Game 5 on Wednesday in Cleveland.

James has never lost a first-round series in 12 previous playoffs. Now, he has two of the next three games at home to try and keep his streak alive.

“I think just tying the series up and coming back home is something we feel good about,” said Kevin Love, who like every other Cav not named James has mostly struggled in this series. “We feel like it’s a best-of-three type series and at the end of the day, if it comes to it, we have two games at home. We like our advantage and we’re going to use that to our advantage (Wednesday) night.”

The Pacers trailed by 17 at halftime of Game 3 but steamrolled the Cavs in the second half and pulled out a 92-90 win behind 30 points from Bojan Bogdanovic, a playoff career high. They were down 10 through two quarters in Game 4 but fought back and were ahead 93-91 with 3:49 remaining before Korver connected on two deep 3s.

Indiana won Game 1 behind a playoff career-high 32 points from Victor Oladipo, who has struggled since (19-of-53 shooting in the last three games). Domantas Sabonis played a big role in the Pacers’ comeback Sunday, scoring a playoff career-best 19 off the bench.

The Pacers are getting the best night of someone’s playoff career almost each game of this series, and it’s been good enough for two wins. Then again, the Cavs’ two wins were by a combined seven points, and outside of James (32.5 ppg this series) almost no one is scoring.

Love is the next closest at 12.0 points in this series and JR Smith is third with 10.0 points.

“We’re not losing confidence,” point guard Darren Collison said, according to the Indianapolis Star. “This team is the defending Eastern Conference champions. Whatever you want to say about them, this is a very good team. They’ve been through a lot over the last few years. We’re fine. There’s no need to overreact or panic. We’re going to go into their building and we’re going to give the same effort.”

The Cavaliers say point guard George Hill (back spasms) is questionable to play in Game 5. He missed Game 4 with the same injury — four injections before the game were not enough to ease the pain to the point where he could play.

Jose Calderon started for Hill on Sunday and scored five points in 19 minutes. The Cavs are 24-9 this year (regular season and playoffs) when Calderon starts.

Hill is the only player on either team listed on the injury report. But Love suffered an injury to his left thumb in Game 1 and it’s affected him. He’s shooting 17-of-47 in the series with 11 turnovers. Catching and gripping the ball have been obvious problems.

“I’ve been able to get up a lot of shots,” Love said. “I think initially it was painful and in the few days that followed, but now it’s kind of subsided and I’m just getting my feel back in my left thumb.”