The Illawarra Hawks, owned by Jared Novelly, have initiated legal action against the National Basketball League (NBL), raising concerns about its management. This action has caused significant disruption within the league.
The South East Melbourne Phoenix, co-owned by notable figures like Nick Kyrgios, has decided to join the Hawks' court action, further escalating the conflict.
The NBL CEO, in an email to team owners, warned of the potentially devastating consequences of the ongoing legal battle, stating it could lead to the league's collapse. He highlighted the disregard for due process and the breaches of legal obligations by the Hawks.
Mark Arena, owner of the Perth Wildcats, responded critically to the NBL's email, questioning the league's own actions and raising concerns about potential retaliation against clubs joining the lawsuit.
The conflict extends to international basketball authorities, with FIBA referring a complaint to Basketball Australia. The complaint made unsubstantiated allegations and included attempts to prevent Larry Kestelman's involvement in the WNBL.
An urgent meeting is scheduled between NBL team owners and Larry Kestelman to address the ongoing crisis. The future of the league hangs in the balance as this legal battle unfolds.
The club advised other team owners that, by law, they would need to join the discovery action to view any information secured via the court.
While warning them against that on Tuesday, the NBL suggested the current crisis posed an existential threat to the league.
“Illawarra and Mr Novelly have been on notice of the destabilising impact of their actions for over six months,” Stevenson said in his email to teams.
“The disregard for due process and breaches of legal obligations (including by improperly commencing court action rather than following the mandatory grievance process prescribed for all clubs and the NBL), have had a material impact on the NBL, its commercial opportunities and therefore all clubs.
“The matters playing out in the public arena are reminiscent of the conduct that almost resulted in the demise of the league before the league’s current ownership was asked to step in.”
Stevenson’s letter brought a sharp response from Perth Wildcats owner Mark Arena. He asked the CEO to confirm whether clubs that joined the court action would be viewed as bringing the league into disrepute and to assure teams they would not face retaliation if they shared concerns with Basketball Australia.
“In my view, if the NBL and basketball has been brought into disrepute, that is by the NBL’s own actions,” Arena replied, pointing to previous media reports that Novelly could be stripped of his licence.
Chaudhari, who co-owns a US Major League Pickleball team with Kyrgios and NFL superstar Patrick Mahomes, added in a further email to the NBL and team owners: “Amen … great points, Marc (sic), thanks for sharing!”
As well as Kyrgios and Dallas Mavericks guard Exum, the other co-owners of the Phoenix include five-time NBA All-Star John Wall and former NBA players Zach Randolph, Josh Childress and Al Harrington.
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The NBL has called an urgent meeting of team owners and Kestelman on Thursday.
He has refused to budge so far as he has come under fire from Novelly’s company, Crest Sport and Entertainment, through which the incoming US ambassador to New Zealand and Samoa owns the Hawks.
Stevenson said a complaint made to basketball’s international federation made “unsubstantiated and baseless allegations of violations of FIBA’s code of conduct”.
FIBA has referred the matter to BA, which has asked the Hawks to reframe its complaint in line with its national integrity framework.
“The FIBA letter also sought to prevent Mr Kestelman’s involvement in the WNBL in circumstances where Crest unsuccessfully attempted to acquire the WNBL from Basketball Australia in 2024,” Stevenson told team owners.
“Ironically, Mr Kestelman has been accused of a conflict for holding interests in NBL clubs and the league (a fact publicly known prior to Mr Novelly’s investment into Illawarra) despite Crest previously holding an interest in the Bay Area Dragons and a significant interest in the East Asia Super League at the same time.
“Ultimately, clubs and owners should satisfy themselves that they are not prejudicing their own rights to pursue the personal gain of others.”
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