Sports
NBA Agent Sues Klutch Sports, Rich Paul Over LeBron Fees – Sportico
By Michael McCann
Legal Analyst and Senior Sports Legal Reporter
Longtime NBA agent and sports attorney Mark Termini and his company, Mark Termini Associates, sued Klutch Sports Group and its founder, Rich Paul, Tuesday in an Ohio federal district for breach of contract. Termini claims he is owed more than $4.9 million for unpaid fees and related harms.
A Klutch spokesperson told Sportico, “This lawsuit is inaccurate and misguided and will be addressed in the proper forum.”
Termini says Paul recruited him to run contract negotiations in 2012, by which point Termini had negotiated over $400 million in contracts. Over the years, Termini’s clients have included Ron Harper, Pau Gasol, Rod Strickland, Jim Jackson and Kosta Koufos. In contrast, at least as Termini tells it, Paul in 2012 was a novice, having “not previously negotiated a player contract as a player agent.”
Termini and Klutch agreed to a three-year contract, later extended to 2020. Klutch agreed to pay Termini 25% of Klutch and Paul’s gross fee on NBA contracts and marketing deals. As depicted in the complaint, the contract contemplated fees being earned even if a contract between Klutch and an NBA player ended. Termini would also be the “exclusive provider” of contract negotiation services to Klutch.
Termini estimates he negotiated “in excess of $1.4 billion in contracts” for Klutch through the free agency period preceding the 2019-2020 season. His services were used for deals with Draymond Green, Ben Simmons, Eric Bledsoe, Tristan Thompson, J.R. Smith and, most notably, LeBron James. Termini says it was his idea to implement a “one plus one” contract strategy for James in which James earned more than $19 million over the course of three short Cavaliers contracts—instead of one longer deal—when he returned to the Cavs in 2014.
Termini adds that not only did he negotiate contract terms but he “decided the structure and amount of all contract proposals, when to reject an offer, and when to impose a holdout.” Termini allegedly guided Paul on when to advise clients about signing, “at which time Termini would set up a verbal handshake call between the Team, the player, Termini, and Paul.”
While Termini says he was “substantively the only” negotiator of these contracts, “[Klutch] and Paul] individually and collectively took public credit in the media for the contracts negotiated by Termini.”
While Paul became famous and influential, Termini’s role appeared secondary and often without accompanying fanfare.
Termini contends that after Paul had established himself as an industry leader, Klutch and Paul began to pay Termini less than what they owed. Termini contends he “refused to accept the reduced rates.” Termini also charges that Klutch and Paul hired third-party agents to perform the work for which he allegedly had an exclusive right to perform.
A complaint, of course, is not a neutral retelling of events. It is an advocacy document. In the coming weeks, Klutch and Paul will answer Termini’s complaint, deny allegations and motion for dismissal. Expect them to offer a different narrative and offer information that disputes the claims. It is also possible Klutch will argue the dispute is subject to arbitration and thus should be dismissed from court.
Kurt Badenhausen contributed to this story.
(This story has been updated in the last paragraph to add additional information about Klutch’s possible argument.)
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