There are a lot of negative things to say about the 80 year old Donald Sterling, the soon to be former owner of the LA Clipper’s basketball franchise. He is a racist. He is a slum lord who has often been sued by the state of California and his tenants for high rents and poor conditions of his properties. He is known as a womanizer who made frequent wild visits to Las Vegas to meet prostitutes.
However, the trust that was set up to own the Franchise looks like it worked perfectly. Donald and his estranged wife, Rochelle Sterling, set up a trust with the two of them as trustees and beneficiaries. The trust was revocable, which means that Donald could revoke or amend it at any time. The trust had a standard clause concerning removal of a trustee, if the trustee lacked capacity. That standard clause was called into play by Donald’s estranged wife as she tried to maximize the value of the Clippers – now that her husband was banned for life and the world knew about his infidelities. Rochelle Sterling, separately from Donald, filed for divorce, and proposed to sell the LA Clippers at the behest of the NBA and indemnified the NBA from the litigious Donald, nullifying the expense to the NBA should Donald win his lawsuit to stop the sale.
The story starts with an innocent phone call made by Donald to his supposed paramour, V. Stiviano, who was in Las Vegas partying, presumably on Donald’s dime. Although Stiviano, who was paid to be an archivist for Donald Sterling, claims she was not Donald’s girlfriend much less paramour, Donald’s wife, Rochelle, better known as Shelly, is suing Stiviano. She is seeking the return of more than $2.5 million in gifts Stiviano allegedly received from her husband, including luxury cars and a $1.8 million duplex paid for by Donald but in Stiviano’s name.
After the recording was released by TMZ with the racially charged comments, the NBA decided to ban Sterling for life as an owner of the LA Clippers. Steve Balmer, the former CEO of Microsoft, paid $2 billion to acquire the team. Donald was against the sale but his behavior seemed a bit erratic.
Shelly hired a UCLA specialist to determine Donald’s mental capacity. His doctor, J. Edward Spar, released Donald Sterling’s medical records to the court of Judge Michael Levanas. The doctors felt that there were some early signs of dementia exhibited by the irascible Donald Sterling. The judge found that Sterling’s capacity was sufficiently diminished for Sterling to lack the capacity to revoke the trust and for Shelly to be the sole trustee. Basically, Donald Sterling was removed as trustee for lack of capacity.
With this finding, Donald’s $12.5 million purchase of the Clipper’s in 1981 was transformed into a $2 billion sale by his erratic behavior which probably had more to do with his being caught being a racist than his underlying beliefs. The trust will continue and Donald’s wife, Shelly, will control it and administer it for her and her husband’s benefit. The humiliation of having someone found incapacitated is probably less a barrier when the couple is in divorce proceedings than during conjugal bliss.
