03:38 - Source: CNN AP
Hawks CEO 'mortified' by owner's email

Story highlights

Probe started after Hawks' general manager made remark about Luol Deng

Though the email has been dubbed racist, Bruce Levenson has his defenders

Despite 30 playoff berths since 1968, Atlanta franchise struggles to make money

Hawks valued at $425 million, but L.A. Clippers sold for four times estimate value

CNN —  

Atlanta Hawks controlling owner Bruce Levenson is on his way out after a racially charged email surfaced in which he – unintentionally, according to his mea culpa – implied white fans were more important than black ones.

But many questions remain, and answers likely will trickle in over the coming days.

Here is what we know and don’t know so far:


How did the email come to light?

Levenson and NBA Commissioner Adam Silver have said Levenson reported the 2012 email, though not until July of this year.

Apparently, Hawks general manager Danny Ferry repeated a racially insensitive remark – he did not use the n-word – while talking about a report on a free agent prospect, team CEO Steve Koonin said.

Ferry made the remark on a June conference call with the Hawks owners, a source with knowledge of the team’s internal investigation said. The free agent in question was Luol Deng, the source said.

The report on the Miami Heat forward, the source said, came from a third party who does not work for the Hawks and can’t be punished by the team.

Following the conference call, the Hawks brought in an outside law firm, which over two months, interviewed 19 people and reviewed 24,000 pieces of evidence. One of those pieces of evidence was Levenson’s email, Koonin said.

Is the email racist or just insensitive?

Well, have a read for yourself and decide.

In a nutshell, he made a lot of hackneyed assumptions about black and white people. Among them, black fans don’t have much money to spend on merchandise and concessions, whites are afraid of blacks, blacks like hip-hop and gospel and whites prefer cheerleaders of their own race.

He also said the “kiss cam” – where shots of smooching fans are beamed onto the Jumbotron during timeouts – “is too black.”

While he derided claims on fan websites that Philips Arena and its downtown environs were dangerous as “racist garbage,” he seemed to imply that it was more important to get the people who were clinging to said garbage into the arena than it was to keep the black fans who were already attending.

Several observers have written the email off as merely insensitive, and basketball icon Kareem Abdul-Jabaar said the e-mail wasn’t at all racist, though some of his assumptions were “cringe-worthy.”

“This is a business email that is pretty harmless in terms of insulting anyone — and pretty fascinating in terms of seeing how the business of running a team really works,” the Los Angeles Lakers legend wrote.

Are Hawks fans as bad as Levenson said?

Take out his assertion that white people are better or cheer louder than black people, and there is a candid assessment of Hawks fandom.

For many games, the number of empty club and upper deck seats is noticeable, and there are stragglers galore moseying to their seats well after tip-off, sometimes up until halftime.

When a huge star such as LeBron James or a popular team such as the Los Angeles Lakers or New York Knicks is in the building, there are so many people rooting for the opposing team, it can feel like an away game.

During the playoffs over the past seven years, however, it’s a markedly different atmosphere with the stands full, voices raised and every Hawks dunk and three-pointer celebrated with pumped fists and a sea of flapping towels.

That said, it’s difficult to overlook the attendance statistic. The team drew an average of 14,339 fans to each of its 41 home games last year. That put them third to last in the league.

Is Levenson the team’s only owner?

He is not. He is the controlling owner, according to his weekend apology, and the Hawks website lists him as a managing partner and alternate NBA governor, along with Michael Gearon.

The site also lists three other owners in addition to Levenson and Gearon, and the Atlanta Journal-Constitution reported earlier this year that the ownership group planned to add five small investors to its ranks.

Little information was provided about the new investors, but Levenson was quoted in the paper as saying they “must be passionate about building a championship team.” The paper further reported that the new investors “have been described as being adept in the digital-content and social-media fields and will offer access to new team sponsorships. The group will be background players and likely will not disclose their identities publicly.”

The team hasn’t divulged exactly what percent Levenson owns, but a 2012 Journal-Constitution article said that Levenson and his business partner Ed Peskowitz took control of more than 50% of the partnership after the group – formerly known as Atlanta Spirit LLC – bought out Steve Belkin’s 30% stake in the team in 2010.


What exactly did Ferry say? Will he be punished?

This isn’t clear. CNN has been told only that it was racially insensitive and that Ferry was relaying information that an outside party had provided him about Deng.

It’s common for a team, when discussing free-agent players, to gather information about those players because they could be given multimillion-dollar contracts.

As for consequences, Koonin told CNN that Ferry has been punished “in excess” for the comment, but gave no details.

“I can assure you, we listened, we reacted, and we’ve put a punishment that is appropriate. Some could say it’s too harsh. Some could say it’s not harsh enough,” Koonin said, adding that the team considers Ferry’s punishment a “private matter.”

Ferry has declined to comment on the punishment.

What are the Hawks worth?

Things are worth only what someone is willing to pay for them, the old wisdom goes.

Forbes says that the Hawks are worth $425 million, but some analysts are speculating the Hawks could command double that price.

It’s worth noting that when the then-Atlanta Spirit bought the Hawks, the NHL’s Thrashers and operating rights to Philips Arena a decade ago, the group paid about $62 million below Forbes’ estimated value of the Hawks and Thrashers combined.

On the flip side, Forbes estimates that the Los Angeles Clippers are worth $575 million.

Donald Sterling, of course, was forced to sell the Clippers after being caught making racist remarks on tape, and after a court battle, ex-Microsoft CEO Steve Ballmer stepped in to take off its hands.

The final price reportedly approved by the league? Two billion dollars, almost quadruple the Forbes valuation

Are they a bad team? Do they make money?

These questions are often asked in tandem, as the assumption is good teams sell seats and seat sales generate revenue.

Historically, the Hawks are OK. They came to Atlanta in 1968, via St. Louis, and have tallied 30 playoff berths and four division titles in that time.

They’ve made the playoffs in each of their last seven seasons. In 2010, they finished third in the Eastern Conference regular season, but they haven’t always excelled in the playoffs and they haven’t so much as sniffed an NBA title.

In the rafters, where most teams hang banners commemorating titles and retired numbers, the Hawks have their handful of division titles and four names: All-Stars Dominique Wilkins and Lou Hudson, Bob Pettit, who played for the Hawks in Milwaukee and St. Louis (but not Atlanta) and former owner Ted Turner.

Even with two Atlanta Dream banners, there’s so much space in the rafters there’s room to commemorate Widespread Panic’s sold-out shows.

And as for making money, the Hawks didn’t get it done last year, and there are reports that the team has operated in the red for some time.

Despite making the playoffs for a seventh straight time this year, the team’s revenue was $119 million, one of the lowest in the league, and they were one of four teams to post operating expenses in the negative digits, minus-$3.6 million to be exact, Forbes reported.

Are reports that Levenson was trying to offload his shares true?

There’s been grand speculation on this, fueled by sales of the Clippers, Milwaukee Bucks and Sacramento Kings fetching a good deal more than their valuations predicted they might.

The Daily Beast posed the question in a headline and cited a sports reporter who previously covered the Hawks as saying, “I can’t help but think (Levenson) saw an opportunity to get out without the backlash of bailing on the team.”

Indeed, in 2011, Levenson was set to sell the team to California developer and pizza chain owner Alex Meruelo, but the deal fell apart, reportedly because of league concerns about Meruelo’s finances.

In the aforementioned 2011 Atlanta Journal-Constitution article, Levenson said he was “extremely” fortunate that that deal collapsed and said he was focused on building up the franchise and owning the team for the long term. He pointed to Ferry as proof, saying Ferry never would’ve left the San Antonio Spurs’ front office if he wasn’t convinced the Hawks owners were stable and committed.

Still, some see Levenson’s self-reporting of the controversial email and quick willingness to sell the team as a little too convenient.

As one unnamed team executive told Sports Illustrated, “I think what happened was he saw how much teams were going for and wanted to make some money. … What he said was wrong, but to me it seems like an excuse to sell.”

Opinion: Levenson and the Hawks’ real problem

Opinion: Atlanta Hawks owner is a hypocrite

CNN’s MaryLynn Ryan, Martin Savidge, Steve Almasy and Ashley Fantz contributed to this report.