Nerlens Noel’s Lawsuit Against Rich Paul Pulls Back The Curtain

New York Knicks center Nerlens Noel is one of the most instructive recent examples of the perils of betting on oneself. During the 2017 offseason, the Dallas Mavericks offered Noel a four-year, $70 million deal, which he ultimately turned down in favor of taking a one-year qualifying offer and hoping he could play his way into an even bigger contract. Instead, injuries and suspensions limited him to 30 games played and he slogged through a series of minimum deals until the Knicks finally gave him a three-year, $32 million contract this summer. According to a lawsuit filed by Noel against his then-agent Rich Paul, Noel missed out on both his big payday with the Mavericks as well as other potentially lucrative deals due to a pattern of "malice, fraud, and conscious indifference to Noel’s rights and interests" on Paul's part. The suit was reported last night by Sports Agent Blog.

Paul is the founder and CEO of Klutch Sports, which represents several NBA superstars including, crucially, LeBron James. Paul and James have built Klutch into one of the biggest and most powerful agencies in sports, most recently flexing this power by signing Anthony Davis and then quickly engineering his move from New Orleans to Los Angeles. It's difficult to make a basketball case that Noel should have earned significantly more money over the last four seasons, though the juiciest parts of his lawsuit have less to do with the mechanics of Noel's contract negotiations and more to do with how Paul wields his power within the league.

Noel says he met Paul after getting sat next to him at Ben Simmons's birthday party in 2017. Paul told him he was a "$100 million man" and that he should turn down the $70 million offer from the Mavs, take a qualifying offer, and let Paul get him a max deal in the 2018 offseason. The recruiting ploy worked, and Noel quickly signed with Klutch. Noel's prove-it season was a disaster, as he tore a tendon in his thumb and failed to provide much value at all to a pretty grim Dallas Mavericks squad. Even then, Noel's lawsuit claims that Paul and Klutch "began to lose interest in Noel as client" and failed to bring "any real proposals to Noel in terms of strategies or ideas on how Noel might secure long-term contract or even significant contract for the following season." Sounds bad, though it's not like Noel was in demand that summer.

But everything changed ahead of the 2019 offseason. Noel had just played a critical role on an ambitious Oklahoma City Thunder team that made the playoffs, and he'd set himself up well to finally earn a real multi-year deal. However, Noel alleges that Paul and Klutch not only failed to think up a plan for him, but suppressed his value by leaking a fake contract offer to a league power broker in order to scare other teams off.

It is no secret that Wojnarowski gets a healthy amount of his transactional scoops from NBA agents (see: Woj making a point of throwing a bone to Paul's underling, Lucas Newton, this summer), or that teams can use his megaphone as leverage in trade negotiations. This is the game in access journalism. Woj will happily carry water for Paul or other power players on less significant transactions in exchange for access to more meaningful scoops. What's noteworthy in this case is the lawsuit's claim that Woj's hasty announcement of a contract for Noel was taken seriously enough that it maimed Noel's earning potential. (It's worth noting here that the Davis trade was completed just weeks earlier.) Teams stopped sniffing around after the Woj tweet, and with cap space drying up as quickly as it does, Noel was forced to sign another minimum deal. According to Noel's lawsuit, Paul actively suppressed Noel's value by refusing to talk to interested teams:

The next offseason, Noel alleges that representatives from the Rockets and Clippers had tried to get in touch with Paul about signing Noel, but Paul didn't return those calls, either. Given that Paul's two biggest clients are LeBron James and Anthony Davis, and given that both of those clients play for the Los Angeles Lakers, it is not a stretch to say that Paul has an interest in the Lakers being good. Noel's lawsuit is concerned with Noel's earnings, not the competitive balance of the NBA, though it lays out allegations that Paul got in the way of maximizing his clients earnings in a way that kept him away from two of L.A.'s biggest rivals.

Noel finally booted Klutch in December 2020, shortly after he signed a $5 million deal with the New York Knicks, a deal he says Paul "played virtually no role in." According to Noel's lawsuit, Klutch has a history of "ignoring other clients and costing them significant money. The belief was that Paul and Klutch Sports were only focused on serving their 'marquee' clients and did not have the capacity to provide competent service to other clients such as Noel." The Knicks are, famously, enmeshed with Klutch rival Creative Artists Agency, so Noel signing in New York while in a relationship with Paul was a bit of a surprise, though it makes sense if Paul was barely involved, as Noel says he was.

Taken as a whole, the lawsuit outlines two possibilities: Made explicit is the claim that Rich Paul runs an incompetent agency that only focuses on its big-time clients at the direct expense of its roster of mid-tier players; left tantalizingly hazy is an implication that they do so in order to manipulate the market in favor of those big-time clients. But even if that last part is never stated outright, the lawsuit is a fascinating peek into how power is actually wielded in the NBA.