NEW YORK, Reuters
An arbitrator on Monday sided with the NBA and ruled that the Minnesota Timberwolves and forward Joe Smith entered into a secret agreement last year in violation of the league’s salary cap rules.
Smith, a five-year veteran, re-signed with the Timberwolves as a free agent on August 17, 1999.
The NBA believed Smith and his agent, Eric Fleisher, conspired to hide from the league a secret pact calling for future payments.
Arbitrator Kenneth Dam agreed, ruling on Monday that the parties entered into an “undisclosed agreement” in violation of NBA salary cap regulations.
The collective bargaining agreement authorises commissioner David Stern to issue sanctions against the Timberwolves, including voiding Smith’s contract for the 2000-01 season.
A spokesman for the Commissioner’s office said Stern will decide the punishment after reviewing the ruling but did not say when any action would be taken.
The NBA began an arbitration proceeding against the three parties on September 18.
“The agreement, which is set forth in writing, calls for future payments to Smith of tens of millions of dollars and was deliberately hidden from the league by the parties involved,” NBA executive vice president of legal and business affairs Joel Litvin charged at that time.