The Donald Sterling Saga 

A Memphis lawyer breaks down some of the legal issues.

We all know the story by now. The mistress of Los Angeles Clippers owner Donald Sterling recorded a conversation with Sterling in which he made racist comments. This led the NBA to ban Sterling for life, fine him $2.5 million, and announce efforts to get him to divest from the Clippers. This whirlwind drama has led people to ask a lot of legal questions.

Did the NBA violate Sterling's First Amendment rights?

No. Public figures have routinely been smacked for making ill-advised comments. And every time a Paula Deen, a Phil Robertson, or a Donald Sterling is dealt consequences for their comments, people argue their right to free speech has been abridged. The First Amendment states that "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press." The amendment applies to the government, not to private entities such as the Food Network, A&E, or the NBA.

How can the NBA get rid of an owner?

Until the Sterling brouhaha emerged, the NBA had kept its constitution and by-laws "secret." However, the league has since made the document public. Relevant to the Sterling situation is Article 13, titled "Termination of Ownership or Membership." It sets out a number of reasons the league can terminate ownership interests, including an owner's failure or refusal to fulfill contractual obligations with the league. So, if Sterling breached a contract with the league, then there'd be grounds to terminate his ownership interest.

ESPN reported Sterling signed documents when he acquired the Clippers that include a clause indicating owners cannot take positions that could materially adversely affect a team or the league. Presumably, the NBA will say that Sterling's comments fall into this category. Is this argument a slam dunk? (Sorry.) Probably not. Sterling will likely claim that a private conversation should not be considered "taking a position." It was not a public declaration, after all. Will this argument carry the day? Stay tuned.

Does Sterling expose the Clippers to discrimination claims?

I am not going to argue whether or not Sterling is a racist. The recording speaks for itself. Draw your own conclusions. But if Donald Sterling is a racist and if his employees know it, is that a problem?

Well, sure. The Clippers organization employs African Americans and other minorities, and not just those on the court. Apart from the players and coaching staff, there's marketing, administration, and so on. What, if any, effect does having someone who is publicly deemed to be a racist have on a workplace?

Let's take the obvious path first. If Sterling were to fire Clippers Coach Doc Rivers (who is African American), could Rivers allege he was terminated due to his race and file a claim under Title VII of the Civil Rights Act or state law? Sure, he could. Part of the evidence could include that the man who fired him had demonstrated racial animus and that whatever reason he gave for the termination was a pretext for discrimination. Does this mean he'd win the case? Not necessarily. But it could make defending it more difficult.

But let's say that Sterling didn't fire anyone and has never said a racist word to any Clippers employees. Could an employee somehow claim that Sterling has created a "hostile work environment" due to his private comments?

To establish a claim of a racially based hostile work environment, a plaintiff must show, among other things, that race-based harassment unreasonably interfered with an individual's work performance by creating an intimidating, hostile, or offensive work environment.

So could the mere fact that a known racist is in charge lead to an actionable claim? As long as the individual leaves their racism at home and doesn't spread those thoughts in a work setting, absent action, liability seems unlikely. Is every employment decision Sterling made in relation to an African American now subject to attack based on his comments? Possibly.

The key take-away here is that if you own a business or work in management, it's probably a good idea to avoid spouting racist comments, even privately. You never know who is recording you and when. After all, if you can't count on your mistress who is about a half-century younger than you to be discreet, who can you trust?

R. Joseph Leibovich is a member of the law firm of Shuttleworth Williams, PLLC.

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