Los Angeles Clippers owner Donald Sterling filed a federal lawsuit Friday against the NBA and Commissioner Adam Silver, alleging breach of contract and a violation of his constitutional rights after the league banned him last month for making racially charged comments in a privately recorded conversation with his female companion.
The suit seeks more than $1 billion in damages, the elimination of his ban and the elimination of his $2.5 million fine. It also seeks the reinstatement of former team president Andy Roeser, the removal of interim CEO Richard Parsons and the termination of the NBA's plan to terminate his family's ownership of the team.
But the NBA already might have rendered the latter request moot and boxed Sterling out legally.
The league announced Friday that it has a binding agreement with Sterling's wife Shelly in which the team will be sold to former Microsoft CEO Steve Ballmer, pending approval by the NBA's Board of Governors.
"The NBA will withdraw its pending charge to terminate the Sterlings' ownership of the team," the NBA said in a statement. "Because of the binding agreement to sell the team, the NBA termination hearing that had been scheduled for June 3 in New York City has now been cancelled. Mrs. Sterling and the (Sterling Family) Trust also agreed not to sue the NBA and to indemnify the NBA against lawsuits from others, including from Donald Sterling."
That means Shelly Sterling and the Sterling Family Trust might have to cover the NBA's expenses if Donald Sterling sues the league, as he did Friday. The Sterlings jointly own the trust, which owns the Clippers.
"If Mrs. Sterling and the Trust specifically agree to indemnify the NBA against lawsuits from others, including Donald Sterling, then, yes, if Donald Sterling sues the NBA over the sale (as distinguished from other types of claims), it would appear that Mrs. Sterling and the Trust would be agreeing to cover the NBA with money from the trust and/or her own personal funds," said Perrie Weiner, an attorney in Los Angeles who is not involved in the case.
Weiner cautioned that he has not reviewed the indemnity agreement, which could have provisions not publicly known.
NBA Executive Vice President and General Counsel Rick Buchanan called Donald Sterling's lawsuit predictable and "entirely baseless."
"Among other infirmities, there was no `forced sale' of his team by the NBA – which means his antitrust and conversion claims are completely invalid," Buchanan said in a statement. "Since it was his wife Shelly Sterling, and not the NBA, that has entered into an agreement to sell the Clippers, Mr. Sterling is complaining about a set of facts that doesn't even exist."
Shelly Sterling reached an agreement to sell the team to Ballmer for $2 billion and did not need approval from her husband because he was determined to be mentally unfit to serve as a trustee in the family trust, which owns the team, a person familiar with the situation told USA TODAY Sports.
The determination was made according to the provisions of the trust related to the trustees' mental capacity, leading Shelly Sterling to become sole trustee and giving her the power to make the sale herself, said the person, who requested anonymity because he was not authorized to speak publicly.
Donald Sterling's attorney, Max Blecher, told USA TODAY Sports no court made an adjudication on his client's mental capacity. However, the person said a court ruling was not required by the terms of the trust, though Donald Sterling could appeal the finding to a court if he chooses.
Sterling said his constitutional rights were violated when the NBA used an illegally recorded conversation — one in which he made racist comments — as the sole basis to ban him from the league, fine him $2.5 million and force a sale of his team, according to the suit.
Even if the recording is considered a breach of NBA bylaws and its constitution, the suit says, Silver's actions exceeded permissible punishment.
Sterling also argues he is the victim of anti-trust law violations because the forced sale of the Los Angeles Clippers threatens to produce a lower price than a non-forced sale and constrains free-market forces.
The NBA's actions are "willful, malicious, and in conscious regard of (Sterling's) property rights," the suit says.
Sterling is seeking damages "to punish their wrongful conduct and deter it from occurring again," according to the suit.