NBA Players’ Union Under Investigation by U.S. Attorney

The National Basketball Players Association, already in turmoil after President Derek Fisher asked for independent reviews of its finances and business practices, is being investigated by the U.S. Attorney’s Office in Manhattan, the union said in a statement.

Union Executive Director Billy Hunter was notified of the investigation by subpoena for documents on April 25, according to two people with direct knowledge of the situation. The people were granted anonymity because they weren’t authorized to discuss the investigation.

“The NBPA will cooperate fully with the government’s investigation,” the union statement said.

The association has appointed a six-member special committee that consists of player representatives and executive committee members to oversee an internal inquiry that will include a financial audit. The statement didn’t say which players would serve on the committee.

The committee has retained Theodore V. Wells, Jr. and the New York law firm of Paul, Weiss, Rifkind, Wharton & Garrison to conduct the inquiry.

News of the investigation comes a week after the union’s executive committee asked Fisher, an Oklahoma City Thunder guard, to resign following his request for an audit and review of how the organization runs its business. The committee, with the support of Hunter, declined to conduct the reviews and two days later voted unanimously to ask for Fisher’s resignation. He refused.

Bloomberg News reported this week that the New York-based union paid $4.8 million to Hunter’s family members and their professional firms since 2001, according to public records.

Family Members

Hunter, 69, has a daughter and a daughter-in-law on staff at the New York-based association. Another daughter is special counsel at a law firm used by the union, and Hunter’s son is a principal at a financial planning and investment firm that advises the organization on investments and runs its financial awareness program for players.

“The mere fact that there may be nepotism is not going to in and of itself draw the interest of investigators,” William Gould, an emeritus professor at Stanford Law School and a former chairman of the National Labor Relations Board, said in a telephone interview.

Jamie Wior, a spokeswoman for Fisher, declined to comment. Carly Sullivan, a spokeswoman for Manhattan U.S. Attorney Preet Bharara said the office doesn’t confirm nor deny the existence of investigations.

Leadership of the 450-member union, which agreed to a new collective bargaining agreement with NBA owners in November, has been roiled over Fisher’s demand for independent reviews.

Fisher’s Dispute

The executive committee first agreed with Fisher’s call for an outside examination of the union. Hunter then met with the committee via conference call and discussed his family’s role in the union and the organization’s finances, said Washington Wizards guard-forward Maurice Evans, a member of the group. After it concluded, the committee asked for Fisher’s resignation, saying he failed to uphold his duties as president. Fisher didn’t participate in the call.

Fisher in an April 20 statement said he was “extremely disappointed” with the executive committee.

Hunter is formerly the U.S. Attorney for the Northern District of California and took over the union in 1996. Owners shut down the league in labor disputes twice during his tenure, in 1998 and last year, when players and owners reached an impasse over a collective bargaining agreement.

The two sides agreed to a 10-year labor contract in November, allowing for a Christmas Day start to a 66-game season, down from the usual 82.

The playoffs begin tomorrow.

To contact the reporter on this story: Scott Soshnick in New York at ssoshnick@bloomberg.net.

Mason Levinson in New York at mlevinson@bloomberg.net.

To contact the editor responsible for this story: Michael Sillup at msillup@bloomberg.net.

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