SBD/July 24, 2014/Franchises

As Testimony Wraps, Shelly Sterling's Attorneys Seek Appeal-Proof Ruling In Clippers Sale

O'Donnell (l) cited a probate code allowing the judge to approve Mrs. Sterling's (r) sale
The attorneys for Shelly Sterling yesterday said that they will "ask a judge to issue a ruling" allowing the $2B sale of the Clippers to Steve Ballmer to proceed, "despite pending lawsuits brought by Donald Sterling in both federal and civil court contesting his wife's authority to sell the franchise without his consent," according to Ramona Shelburne of ESPN L.A. Shelly Sterling's attorney Pierce O'Donnell said that he would "seek what would effectively be an emergency, appeal-proof ruling after testimony concluded in the California probate court case to determine whether she acted properly in removing her husband from the family trust, which owned the franchise before selling it to Ballmer." O'Donnell cited a section of the California probate code which "allows the judge to approve the sale if there is imminent loss of value to the trust." But such rulings "are rare," and it is "not clear whether the pending federal and civil lawsuits even would be affected by such a ruling." Testimony in the "three-week-old probate court trial concluded" yesterday. Superior Court Judge Michael Levanas "ordered attorneys from both sides to submit closing briefs by Thursday afternoon and appear back in court" Monday at 10:00am PT for closing arguments (, 7/23). Both sides said that the "key decisions for Levanas will not be on the late testimony but on a set of somewhat arcane legal questions that will turn largely on legal precedent." In L.A., Rainey & Fenno note the judge "must decide if Donald Sterling's 11th hour dismantling (or 'revocation') of the family trust can stop the Ballmer deal." If he decides the revocation cannot reverse the sale, he "must then determine whether to issue a special order that would enforce the sale, regardless of an appeal by Sterling" (L.A. TIMES, 7/24).

THE PRICE IS WRONG?'s Shelburne & Rovell cited drafts of the Clippers sale bid book as showing that Ballmer's $2.1B bid is "12.1 times the expected 2014 revenues of the team." The document, which was introduced into court on Tuesday, "reveals that the team is projected to finish the year" with $62.3M in revenues from ticket sales, $25.8M from its contract with FS Prime Ticket and $24.1M in additional team revenue. The Clippers also are "projected to receive" $52.7M on the season in shared revenue. After taking away "player payroll costs," total operating revenue for the '13-14 season is projected to be $100M. By using "extremely generous projections, including a new local TV deal" that Bank of America projects will go from $25M to $125M a year, and a 200% increase in the rights fees for a new NBA TV deal, which will begin in '16-17, an additional $160M in annual revenue is "added to the team in future years" (, 7/23).

A RIVERS RUNS THROUGH IT? Interim Clippers CEO Dick Parsons earlier in the week noted Clippers Senior VP/Basketball Operations and coach Doc Rivers could leave the team if Sterling was not removed by the start of the season. TWC SportsNet’s Chris McGee said Rivers is "legitimately frustrated and tired from going at this alone," as there is "nobody in the front office to help him when he sits with free agents, when he goes in front of the media." However, McGee does not see Rivers "leaving that team because I think Donald’s going to lose this before the season starts” ("Rome," CBSSN, 7/23). ESPN's Tony Kornheiser said, "I would not see him leaving. I would not see any players leaving. I think what happened was (NBA Commissioner) Adam Silver, in a good faith gesture, did everything that he could do to get rid of Donald Sterling. But there are courts in America and they don’t bend to the will of Adam Silver." ESPN's Michael Wilbon said Rivers and Clippers players are "really, really on-board with Adam Silver's handling" of the situation" ("PTI," ESPN, 7/23). Meanwhile, CBS Sports Network's Doug Gottlieb questioned how sincere Rivers was about his threat to leave the team. Gottlieb: "It’s a little bit of fake tough guy stuff. It’s a bluff that he has to play to earn respect in the locker room, but he is not walking away from all of that money. You want to walk away from Donald Sterling? He's going to sue you for breach of contract” ("Lead Off," CBSSN, 7/23).
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