Almost four years after agreeing to buy the Minnesota Timberwolves from Glen Taylor, Alex Rodriguez and Diapers.com tycoon Marc Lore have won an arbitration case that will allow them to finally take control of the team. A three-person arbitration panel issued its ruling on Monday, voting 2-1 to let them advance to the final steps of seeing out a contract they agreed to, which Taylor was trying to wriggle out of. The mechanics of that vote, and the process it guaranteed, are far more arcane than simply and immediately transferring ownership, but the upshot is that Taylor is out and the Business Boys are in. It's the story of NBA ownership over the past two decades in miniature.
Taylor has always been a bad owner. This is not always the simplest thing to judge, as a team's performance in the short and even medium term can exceed the willingness of its ownership group to do the two things that distinguish a "good" owner: pay the luxury tax for a good team and, most importantly, shut up and get out of the way. You can't always get both, and many fans would settle for one or the other. Marc Cuban, former Dallas Mavericks majority owner and now Mavericks minority owner, was never willing to abide by the latter clause, though he regularly paid the tax when his teams were in contention. Memphis Grizzlies owner Robert Pera has learned to keep himself out of the public eye—after Sports Illustrated reported that he wanted then-coach Dave Joerger to wear a headset so Pera could personally call in plays—though he is staunchly unwilling to pay the luxury tax.
Taylor was both a cheapskate and a meddler, someone who was so nasty to Kevin Garnett that the greatest-ever Timberwolf only has his Celtics jersey retired. He talked shit about star players as they left; oversaw and got suspended by the NBA for the ruinous Joe Smith disaster; big-timed Andrew Wiggins and made a stink about looking him in the eye before signing him to a 2017 contract extension; routinely undermined the few competent front office people and coaches he lucked into hiring; and treated his franchise like a country club, where he would simply keep hiring his buddies into jobs they were hilariously unqualified for. His greatest accomplishment as an owner was being in the right place at the right time to buy the Wolves in 1994 for $94 million, which is 1/16th of their present-day purchase price.
Over the nearly three decades since Taylor bought the team, franchise valuations soared—at a far greater rate than the salary cap—and a new ownership class moved into the NBA. The old, miserly, and cantankerous Taylor fell increasingly out of place with each successive decade, as relatively young and rich owners bought teams for billions of dollars and then (again, for the most part) followed more modern tenets of team-building. I would argue that the increasingly financialized way the NBA and its franchises are run, smartly articulated by our old friend Jordan Sargent, is downstream of owners becoming more internally competitive as a class.
Taylor is not cut out for this world, where engaged, wealthy ownership is the most significant structural competitive advantage in the game. Lore and Rodriguez, on the other hand, seem engaged and far closer to the right way of thinking, though they are also the clearest representatives of the hedge-fundization of NBA ownership. When they agreed to buy the team in 2021 for $1.5 billion, they did not have the cash on hand and negotiated to pay the sum in three tranches, which would see them buy equity in chunks over time.
This is the seed of the conflict that brought the two groups to court: Taylor tried to wriggle out from under the contract because in the time between the A-Rod group agreeing to buy the team and Monday's ruling, the Wolves got good and the franchise's theoretical valuation doubled. Taylor wanted more money; when literally the Carlyle Group dropped out of the A-Rod group's bid at the last minute and left Lore and Rodriguez scrambling to fill the hole, Taylor tried to invoke an obscure bit of language in the agreement around payment timings to void the deal. Lore and Rodriguez say they did have the money, a claim that has gained credibility now that Michael Bloomberg and Eric Schmidt are on board.
It is odd that an NBA ownership transfer would involve two would-be money guys having to assemble a consortium of money people to finance the transaction. It smacks of private equity, borrowing against the asset they are purchasing with the asset itself as the collateral. The franchise could easily be saddled with servicing the new ownership group's debts. The Wolves fans I know are thrilled with the sale, for what it's worth, and Lore has talked a lot about building a privately financed new arena in Minneapolis.
"We are extremely pleased with today's decision," Lore and Rodriguez said in a statement on Monday. "We look forward to working with the NBA to complete the approval process and close this transaction so that we can turn our attention to winning championships in Minnesota for our incredible fans and the Twin Cities community." Taylor expressed his disappointment, and said, ominously, "We will review the decision thoroughly prior to making any further comment."
According to the Athletic, Taylor will not try to hinder the last step of the process, which is getting approval for the sale from at least 23 of the 30 NBA owners, whose class politics are an interesting factor to consider. What the owners as a class care about are: raising franchise valuations across the board and bringing in owners who will help squeeze labor as tightly as possible.
Here we see why Lore and A-Rod are such good fits. Individually wealthy guys whose first priority is winning, like Steve Ballmer and Mat Ishbia, will fight hard for their side of the collective bargaining agreement and reliably act in solidarity with other owners (well, only 28 other owners, in Ishbia's case), though they've also shown they will spend lavishly to pursue a championship. By all appearances Lore and A-Rod want to win on the court, too, though the structure of their ownership consortium necessarily requires them to be more shrewd about the way they operate their team. The other owners will surely be happy to welcome another group that is financially motivated to depress player salaries as much as possible.
