Category:Contracts
Circumventing the Salary Cap: The Regulatory Gaps within the NBA
In the National Basketball Association (NBA), competition is fierce and success is often decided by razor-thin margins. NBA franchises are consistently looking for ways to gain a competitive edge, prioritizing player acquisitions to increase ticket sales, sponsorships, and franchise value to ultimately improve their chances of winning a championship. Most teams aim to build their roster through the annual NBA draft or the annual NBA free agency period. However, with growing competitive pressure, the line between strategic edge and rule circumvention becomes increasingly blurred. In September 2025, allegations surfaced that the Los Angeles Clippers circumvented the NBA salary cap when reporter Pablo Torre asserted that star player Kawhi Leonard received a $28 million no-show endorsement from Aspiration, a company with financial ties to Clippers owner Steve Ballmer. These allegations have led to the increased examination of current NBA policies and raised questions as to whether the NBA can take a more proactive approach to compliance.
The ACC’s Anti-Competition Contracts: Why Schools Continue to Fight the Conference’s Exit Regulations
In December 2023, Florida State University’s Board of Trustees filed suit against the Atlantic Coast Conference (ACC) challenging the ACC’s grant of rights and “draconian” exit penalties. About three months later in March 2024, Clemson University filed a complaint against the conference challenging those same exit penalties and grant of rights issues. In response, the ACC filed legal challenges against both schools, arguing they agreed to the contract terms and were not allowed to leave the conference or challenge those agreements. Courts will have to look to the ACC’s grant of rights agreement, Article 2 of the Uniform Commercial Code, and State antitrust laws in determining who will succeed in this lawsuit. Several other schools have gotten around their conference’s grant of rights agreements in the Big 10, and Pac-12. However, unlike those conferences’ grants of rights agreements expiring in 2024 and 2025, the ACC’s agreement lasts until June 2036. Regardless, it is going to be difficult for these schools to succeed in challenging the agreements in court.
FTC Proposes Rule Banning Non-Compete Clauses Nationwide
On January 5, 2023, the Federal Trade Commission (FTC) proposed a ban on the use of non-compete provisions in employment contracts. The ban would also require employers to nullify any existing non-compete clauses within six months of activation. The proposed rule applies to all employees and independent contractors, paid and unpaid workers, and businesses of all sizes and location. This is a far-reaching move that has the potential to raise wages and increase competition among businesses.
Proposing to Ban Noncompete Agreements, the FTC Plays its Strongest Hand
On January 5, 2023, the Federal Trade Commission (FTC) published a proposed rule that would categorically ban noncompete agreements between employers and a broad class of “workers,” including independent contractors, volunteers, apprentices, and even sole proprietors who provide services to clients. By pushing for markedly extensive change, the FTC has played its strongest hand. Consequently, the federal government should anticipate that an abundance of litigation will be initiated by the corporate sector’s major players, who will fight for middle-ground legislation.