The federal government and the NBA are investigating Brookings, South Dakota based video display and scoreboard manufacturer Daktronics a in connection with a scandal involving the Los Angeles Clippers in which the club allegedly circumvented the league’s salary cap to sign star player Kawhi Leonard.
During Daktronics’s first-quarter earnings call, chief financial officer Howard Atkins confirmed the company had received requests for information from the NBA and the Securities and Exchange Commission “seeking information from us concerning the company and Mr. Leonard.”
“We take these requests seriously and are cooperating,” Atkins said, according to Dallas Business Journal. “At this point, out of respect for the respective processes, we will not be providing further comment.”
Daktronics was the center of controversy after a story was published earlier this year by independent sports journalist Pablo Torre laying out how Leonard was allegedly paid millions by Daktronics using money that was funneled in from the Clippers, which have a video board designed by Daktronics in their arena.
Leonard’s extension with the Clippers came in 2024 and was worth nearly $150 million.
Torre first reported on the Clippers and billionaire owner Steve Ballmer’s attempts to circumvent the NBA salary cap last fall, with the group vehemently denying the allegations and arguing it was defrauded by investors.
ESPN reported last month the NBA has no evidence to suggest Ballmer funneled money through team sponsors to pay Leonard directly, but rather, the league is focused on “whether the team’s introduction of Leonard to team sponsors constitutes a violation of the league’s rules prohibiting salary cap circumvention.”
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