The NBA’s investigation into the Los Angeles Clippers’ alleged salary-cap circumvention involving Kawhi Leonard appears to be moving toward a negotiated resolution, with the most likely outcome being a settlement that allows Leonard to join the Toronto Raptors.
Sportsnet’s Michael Grange reported Friday that league sources believe the investigation has moved beyond its fact-finding stage. The NBA, Clippers and National Basketball Players Association are now believed to be focused on determining the consequences and resolving the matter before training camps open on Sept. 28.
The NBA is investigating allegations that the Clippers used third-party endorsement arrangements as a way to provide Leonard with compensation beyond what was permitted under the collective bargaining agreement. The latest report from Pablo Torre involving a potential endorsement arrangement with scoreboard manufacturer Daktronics has added to the scrutiny surrounding the Clippers.
However, Grange reported that the latest information may not materially change the next phase of the investigation. A report from The Athletic previously indicated that another alleged no-show endorsement arrangement was already being examined by the league.
NBA commissioner Adam Silver said last month that the independent investigation, being conducted by Wachtell Lipton, was reviewing the information it had gathered and drawing conclusions. Silver also said he believed the investigation could and should be completed before the start of the 2026-27 season.
“That’s just finding that right balance,” Silver said when discussing the need to conduct a thorough investigation while allowing the league to continue operating.
That balance could lead to a negotiated settlement rather than a prolonged legal battle. The Clippers and owner Steve Ballmer would avoid an extended dispute, while the NBA could impose meaningful penalties without forcing the issue into years of litigation or arbitration.
The situation has kept Toronto’s blockbuster trade for Leonard on hold. The proposed deal would send Brandon Ingram, Gradey Dick, unprotected first-round picks in 2031 and 2033, a 2027 first-round pick swap and two second-round selections to Los Angeles for the seven-time All-NBA forward.
Toronto has declined to complete the trade because it does not want to inherit potential penalties connected to conduct that allegedly occurred before Leonard would arrive. ESPN reported that the NBA told both teams any discipline imposed on Leonard after the trade could become Toronto’s responsibility.
The collective bargaining agreement also limits the potential consequences for Leonard personally. While penalties for a confirmed circumvention violation can include team fines, draft-pick forfeitures, contract voiding and suspensions of team personnel, a player suspension is not listed as a penalty for salary-cap circumvention.
Leonard averaged a career-high 27.9 points per game in 2025-26, giving Toronto a significant incentive to complete the transaction. The Raptors went 46-36 and pushed the Cleveland Cavaliers to seven games in the first round, while Leonard would join a core featuring Scottie Barnes, Immanuel Quickley and RJ Barrett.
If arbitration becomes necessary, Leonard could continue playing while the process unfolds, according to Grange. That further reduces the likelihood that the investigation itself prevents him from taking the court.
