In December 2022, Aspiration, a San Francisco-based environmental firm, was running out of money. Employees, including executives, were laid off. Outgoing payments were on hold, including to the firm\u2019s expensive endorsement partner, LA Clippers star Kawhi Leonard.<\/p>\n
That same month, according to the latest allegations made on the \u201cPablo Torre Finds Out\u201d podcast that aired Thursday morning<\/a>, Clippers minority owner Dennis J. Wong made an almost $2 million investment in Aspiration, which turned around and paid Leonard $1.75 million \u2014 as required through his endorsement contract with the environmental company.<\/p>\n The NBA announced last week that it is investigating the Clippers, majority owner Steve Ballmer and Leonard to determine if the league\u2019s rules governing salaries were circumvented through Leonard\u2019s business arrangement with Aspiration, allegations made by former Aspiration employees<\/a> on a Sept. 3 episode of Torre\u2019s podcast.<\/p>\n In Torre\u2019s first podcast episode examining the relationships between the Clippers, Ballmer, Leonard and Aspiration, unnamed former Aspiration officials disclosed Ballmer\u2019s $50 million investment into the company in September 2021 and Leonard\u2019s endorsement contract with the same firm.<\/p>\n The contract called for him to be paid $28 million over four years beginning in April 2022 for a contract that did not require Leonard to do any work (while there were expectations outlined in the document, there was a clause that gave Leonard final refusal on anything he didn\u2019t want to do). The Boston Sports Journal and The Athletic later reported that Aspiration gave Leonard an additional $20 million in stock from company co-founder Joe Sanberg\u2019s personal stock options.<\/p>\n Also in September 2021, the Clippers announced that Aspiration was their new jersey and arena sponsor, a deal that was worth $300 million over 23 years.<\/p>\n Ballmer and the Clippers have repeatedly denied wrongdoing<\/a>. Ballmer has stated that he was defrauded by Sanberg, who has agreed to plead guilty to federal charges of fraud (Aspiration is bankrupt). The Clippers have publicly suggested that there is evidence the team did not circumvent salary rules. The Clippers have not publicly shared this alleged proof.<\/p>\n The NBA has stated that it is seeking clear evidence before punishing the Clippers, so the latest allegations made by former Aspiration employees on the Torre podcast should be given scrutiny. It is against league rules for a team to pay its players additional salary outside of their league-approved contract.<\/p>\n If the NBA determines that Leonard\u2019s deal with Aspiration was a form of cap circumvention, it could punish the Clippers by fining them millions, stripping away future draft picks or even voiding Leonard\u2019s deal.<\/p>\n According to two former finance officials at Aspiration who appeared on the podcast, as well as company bank statements the Torre podcast obtained, Wong \u2014 who owns 1 percent of the Clippers, is the team\u2019s alternate governor and was also Ballmer\u2019s college roommate \u2014 made his first payment to Aspiration on Dec. 6, 2022, while it was clear the firm was losing money.<\/p>\n Leonard\u2019s uncle and business manager, Dennis Robertson, was reportedly upset that a quarterly payment had been missed. Aspiration paid Leonard on Dec. 15 \u2014 the same day the company laid off 20 percent of its employees, or about 100 people, according to the podcast.<\/p>\n \u201cIt is beyond shocking, and I will tell you, I knew that the board (of directors at Aspiration) had put (in) money in December to make payroll and make rent\u2026 (so) it is not a rational investment that someone (Wong) would make,\u201d one of two anonymous former Aspiration employees said on the podcast. \u201cSo it is very shocking to me that $2 million was made as an investment by Dennis Wong, who in my texts is identified as \u2026 Steve Ballmer\u2019s partner a week before $1.75 million was paid to Kawhi.\u201d<\/p>\n A second anonymous former Aspiration official, who is identified as one of the sources who made the initial allegations last week, said, \u201cThere\u2019s multiple things that are conspicuous. One, we\u2019re broke. We\u2019re broke. So to invest in a broke company is beyond me. \u2026 And then the other thing is the amount that\u2019s being invested, that\u2019s such a nominal amount if we\u2019re talking pure investment, especially in a late-stage startup that\u2019s \u2026 already raised a year earlier $300 million (sic), what does $2 million buy you?\u201d<\/p>\n Asked for comment on the latest report, NBA spokesperson Mike Bass said in a statement Thursday: \u201cThe Clippers situation is currently under investigation.\u201d The Clippers did not immediately respond to messages from The Athletic seeking comment.<\/p>\n On the podcast, Torre stated that he obtained a confidential stock purchase agreement from Aspiration, dated Dec. 9, 2022, in which DEA 88 Investments, a limited partnership owned by Wong, purchased 0.072 percent of the environmental firm. In that agreement document, it says Aspiration was \u201cin default.\u201d Its independent auditor, KPMG, had resigned, and the company was already facing lawsuits worth millions for missed payments.<\/p>\n Leonard\u2019s contract with Aspiration stipulates he was to be paid $7 million annually in quarterly installments of $1.75 million. He received his first payment on July 6, 2022, a week past the contractually set deadline of June 30. Aspiration missed a payment to Leonard in the fall before making the payment in December, following Wong\u2019s wire transfer to the firm.<\/p>\n According to a cash forecast for sponsor payments obtained by the podcast, payments to Leonard were marked \u201ccritical.\u201d<\/p>\n \u201cIn all fairness to Uncle Dennis (Robertson), he\u2019s not the only one who\u2019s calling trying to get paid,\u201d one of the former Aspiration employees said on the podcast. \u201cThere\u2019s a huge freeze because there\u2019s no money to be spent. So from the finance team\u2019s perspective, we feel like we\u2019re on the other end of collections calls. People are constantly coming in asking for their money.<\/p>\n \u201cBetween those months when all of this is missing \u2014 so September, October, November, and leading up to December, the actual certainty of the company even existing is up for grabs. At that point, are we gonna get paid as employees? Why does Uncle Dennis keep calling us? We have such bigger concerns that we\u2019re thinking about, which is our own salaries. Are we gonna have to go through layoffs? Where is the money gonna come from?<\/p>\n \u201cBut lo and behold. Uncle Dennis gets paid.\u201d<\/p>\n