Probe: Union execs broke no laws, but need to change policies

By Ken Berger | NBA Insider
Jan. 3, 2013 9:25 PM ET
Derek Fisher's (right) mistrust of Billy Hunter (left) has caused some turmoil within the union. (Getty Images)
NEW YORK -- Players briefed on the exhaustive, eight-month review of the National Basketball Players Association's finances and business practices have been told it uncovered no illegalities, but the final report is expected to include painstaking detail and numerous recommendations for changes to union policies and governance, has learned.
The review by law firm Paul, Weiss, Rifkind, Wharton & Garrison is all but over and the report -- believed to be more than 100 pages long -- is being finalized, multiple people briefed on the matter said. Investigators combed through more than a decade's worth of union business transactions, conducted dozens of interviews and reviewed approximately 100,000 documents and emails, the people said.
The review, spearheaded by noted white-collar criminal defense lawyer Theodore V. Wells Jr., will be reviewed by the U.S. Attorney's office before it concludes its own criminal probe, one of the people familiar with the joint investigations said. In addition, Paul, Weiss has indicated to those interviewed as part of the review that it has "several open items" that it is following up on before the report can be released.
Union officials have met with 15 of the 30 teams during the past several weeks and informed players that the law firm uncovered no illegal activity or violations of the NBPA's constitution, sources said. But the final report is expected to contain numerous recommendations for NBPA governance, including changes to the union's constitution and bylaws, two of the people briefed on the matter said.
The report will include significant detail about how the union conducted business during executive director Billy Hunter's tenure and could directly cite internal union emails. While some players are said to be upset with the price tag of the probe -- which sources say could exceed $2 million -- others are concerned that some of the findings could reveal inappropriate behavior and raise questions about judgment at the highest levels of the union.
Among the most anticipated aspects of the report, which is expected to be released within two weeks, is whether Paul, Weiss will recommend changes to union hiring practices. Hunter's family members receiving money from the union -- either as staff members, in the case of his daughter and daughter-in-law, or in the form of contracted business, as with his son's financial company, Prim Capital -- was one of many aspects of union policy that the law firm investigated in exhaustive detail.
The law firm also will make recommendations for addressing what it found to be a lack of player involvement in union practices and business. Among the procedural changes to be recommended will be that each team must have at least one player representative and an alternate, and that no player without a current NBA contract will be permitted to serve on the executive committee, has learned. Of the nine current members of the executive committee, only four -- Chris Paul, James Jones, Matt Bonner and Roger Mason -- are in the NBA.
"That could be one of the positives that comes out of this," one of the people briefed on the outcome said. "The players will be more involved."
The NBPA retained Paul, Weiss after union president Derek Fisher raised concerns about union finances and business practices in the wake of last season's lockout. In April, the rest of the committee rejected Fisher's recommendation that Washington, D.C., law firm Patton Boggs conduct the review and voted 8-0 that Fisher should resign. Fisher has publicly defended his motives and did not abdicate his position as union president.
Last week, Fisher requested and received his release from the Dallas Mavericks. Though he is not retired, Fisher presumably would have to sign with another NBA team in order to remain president if the union adopts the law firm's recommendation that only current players may serve on the executive committee. That could mean that only Matt Bonner's spot on the executive committee will be secure when the union holds elections during All-Star weekend in Houston. The only other player on the committee whose term isn't up is Keyon Dooling, who has retired and moved into a front-office position with the Celtics.
As the NBPA announced it would be conducting the review in April, the U.S. Attorney's office simultaneously opened a criminal investigation and subpoenaed union documents. Federal prosecutors have not commented publicly on their findings or even stated whether their investigation has concluded.