Witness: Sterling May Need Sale To Cover $500M Debt, Reportedly Meets With Ballmer
LOS ANGELES (CBSLA.com) — As the Los Angeles Clippers ownership trial continued, a witness testified Monday that owner Donald Sterling’s actions may cost his family hundreds of millions of dollars.
On Monday, Shelly Sterling’s attorneys called the Sterling company’s chief financial officer, Darren Schield, to the stand.
Schield testified that Donald Sterling’s revocation of the Family Trust has prompted a default from banks for real estate loans in the amount of $500 million.
“We would have to unload $500 million in apartment buildings,” Schield testified. “I think there would be an impact on the L.A. real estate market, and I don’t know if we could sell that many properties that quickly.”
The attorney for the prospective new owner of the Clippers, former Microsoft CEO Steve Ballmer, who Shelly Sterling arranged to sell the team to in late May, argues that Donald Sterling’s actions involving the Family Trust are further evidence of truth in the opinions of two doctors who determined the embattled owner to be mentally incapacitated.
That testimony was thrown out Friday.
“It shows the madness of Donald Sterling in having revoked the trust without any ability to understand the consequences of his actions,” attorney Adam Streisand said.
Donald Sterling’s attorneys, meanwhile, suggest that with $2 billion in equity in his real estate holdings, he would not struggle finding other methods to cover the $500 million debt.
“I don’t think there’s any risk that they wont be able to get a new lender to step in, or that they’d be able to sell buildings sufficient to cover the debt,” attorney Bobby Samini said.
Donald Sterling’s attorneys continue to argue that since Sterling revoked the family trust, Shelly does not have the legal authority to sell the Clippers to Ballmer.
ESPN’s Ramona Shelburne tweeted shortly after 5 p.m. on Monday that Sterling had met with Ballmer, and possibly Shelly, to discuss the sale of the team.
While she says that a settlement had not been reached, Shelburne says that a source described the meeting as “friendly”.