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NATIONAL BASKETBALL ASSOCIATION MEDIA CONFERENCE

September 21, 2018

Adam Silver

New York, New York

ADAM SILVER: Thank you all for being here. So, we just finished a day and a half of our Board of Governors meeting. We had a pretty full agenda. We adopted three rule changes. The first is we now will reset the shot clock after an offensive rebound to 14 seconds instead of resetting to 24 as we have in the past. That's a rule that's been in place in FIBA for several years now, it's been a place in the WNBA and we have been experimenting in the G League, and we think it will enhance the entertainment of the game. A team that's down, because it will lead to more possessions, will give them a better chance of coming back and just overall increase pace. So -- and by the way it's something that Doug Collins has been talking about for years, so Doug, we did it. Next rule change was simplifying the clear path rule. I'm not going to go into it in detail, but in addition to making it more of a bright line in terms of when that call is made, we're hoping that it would reduce the amount of times that the officials will have the need to go to replay in order to determine what the appropriate call is. So, one, it will be simpler for fans, players, coaches to follow, but also I think that will increase pace as well. And the last is a little bit of a technicality, but we're expanding the definition of a hostile act for purposes of triggering replay. In the past there needed to be a hostile act essentially among players or between players and that if there was uncertainty what might have happened between a player and a coach or even possibly between a player and a fan, under the rules, the officials did not have the authority to go to replay to examine. And I think as you all know for the officials sometimes they have a bit of a sixth sense or they see something out of the corner of their eye or people are pointing to something and they have no, had no ability under our prior rule to then go and examine that if it didn't involve players. So we made that change as well. All those changes were adopted unanimously by Byron Spruell, our president of basketball operations presented those. They had already been discussed at the Competition Committee with the coaches and the general managers, so that was fairly straightforward. Mark Tatum, of course, the Deputy Commissioner, made a presentation on our international plans and we had here at the meeting our new CEO of NBA China, Derek Chang, who made a presentation on new media opportunities in China, the growth of the game there. And I will be traveling to China the week after next where we will be playing two games in Shenzhen and Shanghai. The Philadelphia 76ers and the Dallas Mavericks will be travelling to China. It's a continuation of the preseason games we have been playing there now since 2004. We did also address directly the Dallas Mavericks situation and the report of the independent investigators that was issued just this past Wednesday. There was a memo that I sent out to our teams earlier today in which we used it as an opportunity to remind our teams what we view as best practices in terms of how to conduct an appropriate workplace and frankly avoid the kind of issues that were discovered in the Dallas Mavericks workplace. In part, we took from the investigative report written by Anne Milgram and Evan Krutoy and what -- and it's worth looking at, it's a detailed 45-page report -- but there's about a five-page section in the report that outlines 13 workplace recommendations that the investigators made in this case specifically for the Dallas Mavericks. But we at the League Office thought it was so well done that it was, it clearly put in one place a set of rules that we think all work places should follow, frankly, in the NBA and in all industries. But we saw this as an opportunity to send those directly to our teams and say, take a look at what you're currently doing and make sure literally go down this checklist and make sure that you're doing those things as well. That's on top of some other workplace improvements that we put in place after the allegations came out back in February in the Sports Illustrated article. For example, one thing we, the NBA did not have, which I now understand is a best practice, is a company-wide hotline, employee hotline, so that you can report anonymously if you want or if you want to use your name, it's a report that goes into an independent company that takes that report and then, in the case of the NBA, that report then goes in certain cases to our general counsel at the NBA and other cases depending upon the allegations, directly to the audit committee of the NBA. And many of our teams also have their own hotlines. What else we also learned from the Anne Milgram report is that because people may not be willing to come forward, even on an anonymous basis or maybe they just don't trust hotlines, that it's necessary to do anonymous workplace surveys. For example, it's very important that you have mandatory training for all your employees. That's something that we have had instituted a while ago at the League Office but now all of our teams will be doing. The Mavericks, of course, will be required to do it and have already embarked on doing it. But those are just some of the examples outlined in the investigative report again of what we see as best practices. I mean, part of what also has come to light and the number one recommendation not surprisingly in the investigator's report is that you need women in the workplace and that in order to have a diverse point of view, in order to ensure that ultimately that women are heard in the workplace, not only do you need women, but you need to keep appropriate data, especially as your work place gets larger, so that you can make comparisons and you can see, are women on average making the same amount as men. Are people who are younger, you can, based on race, other cuts that people look at for analytical data. That's something that was not happening in the Mavericks' workplace, but that's also a best practice that we're recommending to all our teams. One of the other things that we are recommending to our teams, and this is something we're doing in the League Office and it came up at the, in the discussion with the owners, is that we feel like when there's a moment in time like this when such a detailed report has come out, when people within the NBA family know many people who work at the Mavericks, know many people who used to work at the Mavericks, many of us know some of the people named in the investigator's report, that these are traumatic moments for people and that there needs to be an opportunity to be heard and to have a full discussion about how people are feeling emotionally in these moments. So what we're recommending to our teams and we're doing the same at the League Office is that there needs to be facilitated discussions, whether community conversations, town hall, but they're really, town hall, I think, is misleading because they often need to be done in smaller groups, you need professional facilitators and sometimes they're very raw, but people need that opportunity to speak about their reactions to these kinds of moments and often it stirs up a lot of things in people's lives. Maybe things that didn't happen even in the workplace they're now in, maybe it happened in a former job, maybe it's just a moment that happened in their lives. I mean, of course their moment like that is very much in the news right now. And so we're working with our teams. I will say all the teams in the room were very receptive to those kinds of programs and I think it was a sobering moment. I don't know how else to say it for everyone there and I think there's a lot of introspection now with all our teams and as people are looking through those lists saying, can something like this happen in my workplace, whether it's the NBA or any other businesses they operate, what are the best practices preventing those things going forward. I can only say, we will redouble our efforts at the League and working with our teams to try to ensure that the kind of events that happen at the Mavericks never happen again. With that I'm happy to answer any of your questions.

Q. Obviously there was, Mark Cuban not being there was part of the report, simply not in the office. I'm sure a lot of your owners are that way, they have other businesses or they don't live in that city maybe perhaps. What's your confidence that ultimately ownership knows what's happening with their teams, not everything, but at least the big things like this?
ADAM SILVER: It's a great question and there are many different models for how these organizations can run. I mean one of the particularities in the case of the Mavericks is that the central perpetrator here carried the title of CEO at the Dallas Mavericks. And I'm sure for many of the employees at the Mavericks, that created an expectation that not only of course with that CEO always behave in appropriate behavior but that, my God, if the CEO is doing these things, what's the point in even bothering to report other people's inappropriate behavior or certainly his. And I think for our owners many of them live across the country, some who even live closer to the markets are engaged in other full-time jobs and some of them in essence do act as CEO's of their own franchises and one of the recommendations in the investigator's report is that roles be clarified for owners and then for everybody else in the organization. And this is one of the things that comes out when you read through the investigator's report, that there was a lot of ambiguity in terms of what Mark's role really was. He spent all his time at the basketball office. I mean, those of you who cover the league know that the Mavericks' business office was located a few miles away from the basketball office. Mark's office was where the basketball operations took place, not where the business office was. And when it came time to making decisions about personnel, what the investigators found after interviewing 215 people and looking through 1.6 million documents, was that it was very haphazard. Sometimes someone would e-mail Mark, other times they wouldn't. Or they would e-mail him on something, he would express a point of view, then they would never go back to him. And so lesson learned here for organizations big and small there has to be almost militaristic clarity on reporting lines. Who's in charge, who makes a decision and that has to apply to the owners. If an owner is going to be involved in their organization, everybody has to understand that, on certain personnel -- certainly what the report isn't saying is that if you own an organization you have to be involved in the day-to-day matters of that organization, but that if you're not, you certainly need a CEO, there has to be clear delineation of what that CEO is in charge of and of course, on top of that, you need checks and balances with that CEO, so there are ways, in case you have a CEO who is doing things that are inappropriate, that through anonymous surveys, hotlines, audits and other things, that through a fully functioning HR department -- something else they didn't have at the Dallas Mavericks -- there's also a check on the CEO as well.

Q. I know Mark has a 10 million dollar donation, the report was very scathing. Why is that penalty sufficient enough and maybe more directly, why was he not suspended?
ADAM SILVER: I'll begin by saying I don't know what dollar amount could possibly compensate employees over a long period of time for that type of misconduct. I would say that I had to begin with, from a financial standpoint with what my fining authority is in the NBA constitution, as you know that's two and a half million dollars. I arrived on a number that was four times that. And while I couldn't compel him to pay it, I went to him and thought, under the circumstances, that would be an appropriate number. So I accept it's arbitrary to a certain extent but my at least my beginning point was what my authority was as commissioner. I will say that now just speaking to the dollar amount, that 10 million dollars is an enormous amount of money in terms of the good it can do to help further the cause of women in industry, women in sports, education around domestic violence and other critically important issues and I also can tell you just in the last two days since we first announced the 10 million dollars payment, we in the League Office have heard from tens of organizations and many who we already have relationships with, who are saying, a hundred thousand dollars would make a huge impact to the work we're doing. So 10 million dollars is an awful lot of money and I accept that I can't sit here and say how that is going to change Mark Cuban's life, but I know I deal with lots of wealthy people, 10 million dollars is still a lot of money. But to go to the heart of your question in terms of why I did not suspend Mark Cuban, I was heavily influenced by the fact that after reading what was initially a much longer and detailed report from the investigators, that Mark Cuban was never directly implicated in the misconduct. So that was an important factor for me in making that decision. Should he have known in many cases? Absolutely. But again, from the 215 witness interviews, the over a million pages [of documents], the clear picture that was presented was Mark was absentee from the business side of the organization. So that was a critically important factor and by no means though does that absolve him from responsibility. I would then say ultimately in deciding that a suspension wasn't appropriate what I very heavily weighed was the organizational reaction from the moment the Sports Illustrated story came out. And I can only say there, I've been with this organization for 26 years, I was a practicing attorney before then, and I cannot think of any situation where somebody was more transparent and more forthcoming, more accepting of responsibility than Mark was in this situation. And, I watched Anne Milgram at her press conference and she said the same thing and the report indicates the same, that Mark said, I am responsible, the investigators that came in were completely independent, they worked hand in hand with both our general counsel, Rick Buchanan at the NBA and our outside counsel Wachtell, and even Anne Milgram said, you hear that all the time from CEO's or from owners, yes, you have complete access but then on day two they say, you know, not so fast, I'm not so sure about this and that. That was never the case in the situation of the Dallas Mavericks. And I think that where I credit him is that is what is enabling us to have the conversation that we had with our owners today. The ability to talk directly about the very specific facts about what went on in that organization, as uncomfortable as those discussions will be for a lot of people, it wouldn't have happened without the, this level of cooperation provided by Mark Cuban and the Mavericks. And then beyond even the transparency and the remorse and the acceptance of responsibility, the speed in which changes were made. And again, I would say from experience, there was no, in essence, lawyering up and saying, well, I'm going to have to do the following things before I start making changes. I think everybody's now become familiar with Cynthia Marshall, goes by Cynt, who came from with a recommendation from AT&T, someone that Mark had never met before as far as I know, someone he had no prior relationship with, Kathy Behrens at the League Office and myself met with her the moment she came in. She was given a very specific charge by Mark, in essence to fix his organization. He didn't give her a budget, he didn't give her any sacred cows and she went to work. And it's quite amazing the transformation that's happened over the last seven months. For example, as she has said, they went from an organization, again this goes back to Anne Milgram's number one recommendation, that had zero women in senior management on the business side to an organization that now has roughly 50 percent women in senior management on the business side. This is now an organization that has the training of every employee, reviews of every employee, clear delineation in terms of job descriptions, titles, reviews. So I would only say that I did heavily credit how his organization and how he responded in this situation and I would also say, too, that that to me is an example that I don't see in any other industry, where someone is willing to put themselves out that way and be that forthcoming and act and be that responsive. So given the totality of those circumstances, I ultimately decided that a suspension was not appropriate.

Q. Your league has long been committed to player movement between contracts. But in the wake of situations we have seen with Paul George, with Kawhi Leonard and from recent reports, Jimmy Butler, how do your owners feel about players pursuing freedom of movement during contracts. And I guess from the league's perspective, I know this might be a CBA thing, but is there anything that the league could do such as allowing current teams to pursue their longer extensions sooner?
ADAM SILVER: It's a good question and we're always trying to find the right balance in terms of right contract length, advantages of incumbent teams to keep teams in those markets and keeping players focused on playing under their contracts. I don't know if there's any scenario where these situations will go away completely. I mean we put in place rules I think two CBA's ago so that at least we could prevent the public requests for trades. But certainly in the most recent situation you're talking about, when no one's denying it, it's, people are accepting as fact those rumors that are being printed and we know it puts teams in very difficult positions. So it's going to be something that we're going to continue to work through. I think that it's never been a secret that in this sport in particular players have enormous leverage, but teams have leverage, too. It's something that should be in everyone's interest, frankly, teams and players, that for players to honor contracts. Because in a team sport an individual player's desire to leave that market has a huge impact on his teammates as well, many of whom have come to that market out of a desire to play with that player. So I'm sure it's something we'll continue to talk to the Players Association about. Even if I had the unilateral right to make changes in the CBA, which of course I don't, I'm not sure there are any easy fixes here. This is a relationship business and that's something that's never going to change, despite advances in analytics, scouting, technology, it's still a people business. So we'll just have to keep working at it.

Q. Given the severity and breadth of what was detailed in the report about the Mavericks, how much weight did you give to when you're coming down on these sanctions part of it. And 10 million dollars I know was a donation as much as anything, but did you consider what the precedent set would be, what the message sent would be to other teams and their responsibility and the accountability that they would have to have. As I'm sure you're aware, there are plenty of people who feel like they got off a little easy, considering how long this had been going on and again the severity of it. And stipulating, I know, that the two and a half million number and the bylaws, but feels like that's from another era when you had millionaire owners instead of billionaire owners and the perception I think, and I sympathize that this is perception, that there's not an accountability being imposed there. So how much of your decision making considered what the accountability should be, how to impose that and what that means for other owners and the organizations going forward?
ADAM SILVER: It's a great question and I would say I considered a precedent in a way that I'm not sure you intended in your question. When I look at precedent for potential discipline, no different than when I look at precedent for when dealing with players, I look at what's happened in the past. And in the past recognizing a lot has changed in the world, there are no examples where owners have been suspended for someone else's misconduct. And to your point on the relevance in this day and age of a two and a half million dollars fine limit that maybe that number's too low, but in terms of fairness and due process, then you have to change that number before the fact, not after the fact. And also in terms of precedent, what I have to look at when it comes to Draconian discipline, like a suspension or something else that people have referenced, loss of draft picks, I have to look at what the impact of that standard will be going forward. And then think, all right, this case can't stand apart, if now team ownership -- and again I also try to think what it means in a broader corporate context. If owners, shareholders, even a CEO -- and Mark was not the CEO in this case -- are going to be held accountable for the misconduct of others in their organizations, what's the standard that I'm going to be setting going forward and how many suspensions therefore am I talking about. So I did take into account all those factors and I think you raise a very good point about whether the authority in the League Office is sufficient right now, but again I would only say that's something that has to be looked at prospectively and I think that the same fundamental of fairness that I try to apply when dealing with players should deal with owners as well. And I think if I had suspended him here, again, for conduct that was not directly his, I think I would have been establishing a very new standard, not to suggest to your point that it may be appropriate in some context, I didn't think in this case, again in the totality of the circumstances and I'm acknowledging, I heavily weighed the response, that ultimately that I thought it therefore would have been appropriate to suspend him.

Q. If the bylaws had allowed for more did you have any impulse to go further? How much consideration would you have had just philosophically to going further?
ADAM SILVER: Well I went four times what the bylaws allowed. I went to 10 million and the limit was two and a half million. So, again, there's, it's hard on any scale to compare it because it's the highest, by definition, highest fine ever imposed since we historically were limited to two and a half million dollars. And again I only say that it's an enormous amount of money and I think that 10 million dollars can do, can generate a lot of goodwill with many different organizations and but I also recognize that at the end of the day that no dollar amount that I could have selected is going to make those people who existed in that culture feel any better.

Q. The memo today strongly urged the other 29 teams to implement some of the changes that the Mavericks have been forced to make in the wake of this incident. Do you have the authority to force the other 29 teams to make those changes and did you consider forcing the other 29 teams to make those changes?
ADAM SILVER: Again, it's an excellent question. I'm not even sure the extent of my authority there. I think here I had a strong desire to move very quickly and to take advantage of an otherwise ugly moment to laser like focus our teams on these issues. It is my complete expectation that every team will follow those guidelines. I mean remember that some of our teams operate as parts of other larger businesses. They already have different practices in place. But my sense is that having sent that memo out that, again, Kathy Behrens in our office, our general counsel, Rick Buchanan, others, will work directly with the teams and that to the extent they're not exactly complying, that in substance they will be because it just may be that they have a different corporate form. But there was no resistance to -- I sent it out in a memo, but we also discussed it at the owners meetings -- and I think again everyone recognizes that we are now at a point where even in some cases we're dealing with very small, sort of mom and pop size businesses still, when teams are stand alone, that given what's at stake here, and given, honestly, the values of this league, it's imperative that we follow those times of guidelines.

Q. Unrelated to the Mavericks, but I think the meeting in the spring you had mentioned that tanking was still a troubling issue for you and obviously you've changed the Lottery odds at the top of the Lottery, flattened it out to a degree. Was that a topic of conversation in this meeting with the owners and do they share some of your disappointment with the issue?
ADAM SILVER: It's interesting, rebuilding, tanking, did not come up in this meeting. It may be because the games haven't started yet and as you pointed out we have new Lottery odds beginning with this season. So we'll see what happens. But as you said, I've talked about it before, ensuring that every team is always motivated to compete night in, night out still is a very high priority for me.

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