The SEC and the NBA have requested information from Daktronics regarding Kawhi Leonard and the Los Angeles Clippers, as outlined by the company's chief financial officer during Wednesday's earnings call, where he said the business is cooperating with both processes and will not comment further out of respect for the ongoing reviews, a point detailed by CBS Sports — NBA and RealGM — Basketball Wiretap.
Request to Daktronics
Chief financial officer Howard Atkins said the company had received information requests from the league and the securities regulator concerning the company and the player. He added that Daktronics takes the requests seriously and is cooperating, declining additional comment while the respective processes continue.
Background to the NBA review
The outreach forms part of the NBA's ongoing review into whether sponsorship arrangements linked to Kawhi Leonard complied with the collective bargaining agreement and salary-cap rules. Opened last September, the inquiry examines whether no-work sponsorship contracts may have been used to circumvent cap restrictions. Cited background includes a sponsorship deal with Aspiration, a former jersey patch partner of the Clippers that later entered bankruptcy, and prior investment by owner Steve Ballmer in that company.
Recent development and competitive scope
Recent reporting pointed to an undisclosed sponsorship arrangement between the player and Daktronics, the manufacturer of the Halo video board at the Clippers' Intuit Dome. The NBA retained an outside law firm to lead the examination and no public findings have been released, so any assessment of a collective bargaining agreement breach remains pending.
