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


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.

Chris Paul’s game-winning miss helps Rockets end Blazers’ 13-game streak

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Tuesday night at Moda Center was electric. It was a game of switches, both between opposing big men on the pick-and-roll and as the lead batted between the Houston Rockets and the Portland Trail Blazers.

It was all we could have asked for between two of the best teams in the NBA.

The Blazers were aided by a hot start from Al-Farouq Aminu from beyond the arc. The defensive stalwart hit four threes in the first quarter alone for Portland as the Blazers took a four point lead into the second period. Houston, accustomed to playing in Rip City when their arena is at its loudest, wasn’t phased by the atmosphere.

James Harden went off — he finished with 42 points and seven assists — and looked unstoppable. At one point, after nailing a 3-pointer in the first half, Harden turned around and gave the Portland sideline a look. The leading MVP candidate was there to play, and the rain of boos that came down from the 300 level at the Moda only fueled his fire.

On the other side of the court, Portland’s star point guard seemed just off of center. Perhaps it was anticipating the soon-to-be birth of his child or just the stress that comes with upholding a 13-game winning streak, but Damian Lillard‘s aim was poor and he wasn’t as large a factor as he’s been all winter. In fact, both Lillard and C.J. McCollum were quiet on the night. McCollum, the other half of the second-highest scoring duo since the All-Star Break, had just eight points on a night where he shot 4-of-15 from the field.

But the story of these two teams, and why they remain top playoff contenders, is their defense. That showed all night, with the margin between the two staying razor thin until the final seconds. The Blazers’ strategy was to force switches, often getting Moe Harkless, Jusuf Nurkic, or Evan Turner on smaller Rockets players while hoping to either attack the basket or swing the ball after the Rockets’ excellent help defense reacted.

Houston countered brilliantly, often guarding Nurkic with either Luc Mbah a Moute or PJ Tucker as they forced the issue of small ball on Portland. Much of the game rode on the offensive decision-making from Blazers in the post or the ability of the Rockets guards to burn past the likes of Nurkic and Ed Davis off the switch.

Chris Paul was the other factor for Houston — no shock as he loves going against Lillard — especially from beyond the 3-point line. Five of Paul’s six made field goals were from beyond the arc, and he dismantled slower Portland defenders as he snaked, shaked, and flailed his way around pick-and-rolls.

Despite the close play, Houston appeared to have struck a defiant blow when Harden hit a step-back 3-pointer with 1:55 to go, giving the Rockets a nine-point lead. But Portland rallied, with Lillard quickly drawing a three-shot foul to push the Blazers closer. Portland scored twice more in quick succession, and they were once again within striking distance for the win.

The game came down to a final Houston possession with five seconds left as Paul missed long on a floater in the middle of the lane. Miraculously, the ball hit off the back of the iron, out of reach of any Blazers rebounder (although a crafty hold by Paul on Aminu certainly helped).

Houston recovered the rebound, and closed against a heated rival.

Meanwhile the story for both teams at the end of the game was clear: both are for real.

The Rockets, leaders of the West even before the Golden State Warriors were bitten by the injury bug, showed they could come into a hostile environment against a team that badly wanted to win in Portland. Houston’s resolve was clear; while the Blazers never looked unfocused, the Rockets did feel like the senior team and the leadership from Harden and Paul was a preview for what we should expect come playoff time. That’s big, especially when you consider Paul’s playoff demons and the hovering expectation that the Warriors are somehow going to come charging back and blow everyone out come spring.

For the Blazers, the sadness of the 13-game streak will linger but for a moment. Portland, who was essentially a .500 team until Christmas, looked like they were ready for the big moment. Many of the Blazers’ players, including Nurkic, Aminu, and Harkless, have struggled with inconsistency all season long. But as they took on the Rockets, all three were the ones keeping Portland in it when Lillard and McCollum struggled. I had my doubts about the Blazers perhaps longer than most, but even in defeat Portland’s showing against Houston makes them look like a solid favorite in any first round playoff series they draw, and not just because of seeding.

Houston beat the Blazers, 115-111.

Let’s do this again sometime soon. Say, in mid-May?

It’ll make sense when you watch it: Steven Adams uses Al Horford to scratch his head

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Look, Steven Adams is a weird guy. He’s always answering questions with weird, unrelated scientific terms or calling former teammates “dicks” with a smirk on his face. Adams has a subtle and fun personality.

This? This isn’t so subtle.

As the Boston Celtics took on the Oklahoma City Thunder on Tuesday night, it was time for a regular old free throw. The kind that happens all the time during NBA games. But Adams, apparently bored with how they usually go, wanted to mix up his routine on the lane line for this one.

That’s when he apparently decided to use Al Horford‘s right forearm as a means to scratch his own head.

Just … just watch the video:


I don’t know either.

Meanwhile, Marcus Morris beat the Thunder with 1.8 seconds to go. Oof.

Marcus Morris hits game-winning shot to send Celtics over Thunder (VIDEO)

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On a night without Kyrie Irving, the Boston Celtics still found a way to grind out a win.

As the rising Oklahoma City Thunder came to Massachusetts, a slow-scoring game evolved as a game of the NBA’s best defenses came together. Still, the Thunder were in the lead and looked to be on their way to their 44th win of the season.

But despite having a six-point lead with 24 seconds left, Oklahoma City choked an important game away late down the stretch.

It started with Jayson Tatum hitting a quick bucket with 17.6 seconds to go. Russell Westbrook was fouled, but missed one of his two free throws. That set the stage for Terry Rozier to hit a 3-pointer with 12.7 seconds left.

Then, astonishingly, Carmelo Anthony missed two straight free throws.

That’s when Marcus Morris stepped in:

Oof. You don’t expect Oklahoma City to come out flat like that against a depleted Celtics squad, and you certainly wouldn’t think they could clunk away the victory from the free-throw line.

It was a gutsy win for Boston and one of the worst losses of the season for the Thunder since the righted the ship around Christmas.

Royce White critical of how Rockets handled his mental health situation


Royce White had an NBA story that was up-and-down, and complex. White, drafted by the Houston Rockets 16th overall in the 2012 NBA Draft, has a well-documented anxiety condition that disallowed him from flying with the team to games.

Things didn’t work out in Houston, and the last time White was in the NBA was during the 2013-14 season. He played a total of nine minutes in three games for the Sacramento Kings, and then White’s career was over.

Now, with the sudden influx of players making public their owns struggles with mental healthDeMar DeRozan and Kevin Love most recently — White has suddenly been thrust back into the conversation. While Ron Artest might be one of the first players of the modern era to openly speak about mental health, White is the go-to guy for comparative statements these days.

And, what White has to say isn’t all that great for the NBA or the Houston Rockets.

Speaking to Yahoo! Sports’ Dan Devine, White said recently that he doesn’t believe the NBA truly cares about mental health just yet. Even further, White said he felt the Rockets and GM Daryl Morey were trying to guard themselves from a liability standpoint when the player and the team negotiated a deal to try to make things work with the Rockets.

Via Yahoo! Sports:

White says that Rockets personnel told him in 2012 that establishing a comprehensive written plan for managing his anxiety disorder would be “impossible,” because doing so would set a precedent “for any league-wide issue regarding mental health.” He says that, after negotiating with the Rockets and the NBA over allowing White to take a bus to certain games to reduce the number of flights he’d have to take in a season — a compromise he was told the league initially rejected because it would constitute an illegal circumvention of the salary cap — Houston deactivated him for the first preseason game he took a bus to, as a punishment for pressing the issue.

White says that, in a later meeting in which he and a team of medical professionals planned to present a draft of a mental health policy to be added to his contract, Houston general manager Daryl Morey said he didn’t know that White suffered from generalized anxiety disorder before drafting him.

It also made him feel like the Rockets might be trying to set up a way to void his guaranteed contract if he didn’t comply with their requirements.

“[Morey] was in a mode where he thought that he could bully me,” White said.

According to Devine, White also says he doesn’t think the most recent stories of mental health awareness will be the triggering factor in a new wave for the league. “White expressed skepticism that revelations by DeRozan, Kevin Love, Kelly Oubre and others would really lead to a sea change in the way the NBA addresses issues of mental health,” wrote Devine.