The Los Angeles Lakers’ $12.5 billion ownership change has created a separate problem that reaches far beyond the sale itself. Five of the six Buss siblings want to immediately sell the family’s remaining 17.8% stake to Bob Iger and Joshua Kushner, but Jeanie Buss has publicly opposed the move. Why?
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Jeanie’s objection is tied to a 2017 LA Superior Court order that, according to her attorney, requires the Buss Family Trust’s co-trustees to protect her position as the Lakers’ Controlling Owner. Selling the entire stake would leave Jeanie without the equity she needs to meet the NBA’s governor threshold. Here’s where the deadlock situation could demand divine intervention.
By that, we don’t mean God, but the NBA’s highest authority figure, Commissioner Adam Silver. A Sports Business Journal report by Tom Friend says there is an expectation that Silver “will try to help smooth over” the issues among the Buss family.
It puts the Commissioner in a difficult position given his relationship with Jeanie and his longstanding relationship with incoming owner Bob Iger as well. Silver previously backed Jeanie’s Lakers leadership in 2017 when Jim Buss backed out as a trustee.
“We are pleased that this matter has been resolved,” Silver said of a potential Buss family court case being avoided. “Jeanie is as knowledgeable and experienced as any owner in sports and the Lakers are in great hands.”
On the other hand, Silver reportedly has a good bond with Iger after working together for years. The NBA’s largest contract with ABC and ESPN televising the games since 2002, and the 2020 season resuming inside the Walt Disney World Resort are the biggest examples. Further, a league office source told ESPN that “they’re not just business close, they’re vacation-together close.”
But Silver has not formally intervened in the current dispute yet, nor has the NBA issued a public directive on the Buss family’s fight. For now, the majority sale from Mark Walter to Iger and Kushner is awaiting NBA Board of Governors approval, while the dispute over the Buss family’s 17.8% stake is unresolved.
This issue has created two separate tracks in the same ownership transition! Iger and Kushner are working to complete the purchase, while Jeanie’s legal team is challenging her siblings’ attempt to sell the family’s remaining shares. The conflict began after Walter agreed to sell his Lakers controlling stake for $12.5 billion, less than 12 months after acquiring it at a $10 billion valuation.
The deal triggered the Buss family’s “tag-along” rights, allowing the trust to sell its minority stake on the same terms. Five of the six Buss siblings: Jim, Johnny, Janie, Joey and Jesse voted to sell the family’s 17.8% stake, which is worth about $2.2 billion. But whatever they tried didn’t matter for a legal reason.
Jeanie was the only sibling to oppose the sale. Through her lawyer, Adam Streisand, she challenged the vote by citing a 2017 order that forces the Buss Family Trust to keep a sufficient stake in the Lakers so that Jeanie can remain in charge. Any attempt to do otherwise “would constitute a breach of trust, breach of fiduciary duty and be in contempt of court,” Streisand wrote.
Now, NBA bylaws require a team governor to maintain at least a 15% ownership stake. So, logically, Jeanie will need to retain her stake by either repurchasing the shares herself or obtaining a special league waiver. Meanwhile, new owner Iger publicly assured everyone that Jeanie’s position as Governor will remain intact.
“We have enormous respect and appreciation for Jeanie, her father and what they’ve contributed to this franchise,” Iger told the California Post. “We have every intention to honor the agreement that was made between Mark and Jeanie. If things change, they’ll change, but we’re going into this with enormous respect and appreciation for who she is and what she represents in the organization.”
Iger mentioned Walter’s agreement that crucially keeps Jeanie in charge through 2030 (at least five years). However, Jeanie’s path to maintaining the required equity recently became narrower on August 20, when Patrick Soon-Shiong’s attorney confirmed that the Lakers minority owner has no plans to sell his 4% stake.
It removes one potential block of shares Jeanie could’ve pursued, although even Soon-Shiong’s entire stake would fall well short of the 15% threshold on its own.
“Bob Iger and Josh Kushner are good friends, and we will be joining them as supportive, active and engaged partners once they close the transaction with Mr. Walter. [Dr. Soon-Shiong is] absolutely not selling,” Soon-Shiong’s attorney, Chuck “Tiger” Kenworthy, said.
Meanwhile, NBA analyst Andy Kamenetzky sees the dispute as a major test for Adam Silver to confront a super-uncomfortable ownership situation.
“Like his willingness to twist arms and make things uncomfortable for everyone, including himself, because confrontation is not his wheelhouse,” Kamenetzky said on Locked On Lakers. “Adam Silver has to choose between siding with the incoming majority owners of the Tiffany franchise of the league, one of which, Bob Iger, is a personal friend of his… or the one member of a minority owner contingency, where the other five want to get out, I can, again, promise you, I know which side he would prefer.”
Kamenetzky drew a parallel with former Commissioner David Stern, claiming that he had his set of “faults” during his NBA tenure, but he would have never hesitated to be confrontational with anyone, especially when the league’s financial and reputational interests are at stake.
The league’s reputation is at stake also because of Walter’s rapid exit, adding another layer to the story. He negotiated the sale of his majority stake over 72 hours, with reporting linking the speed of the transaction to liquidity needs and federal Department of Justice scrutiny involving entities connected to Guggenheim Partners.
For now, however, the two sides remain on separate tracks. Silver has not formally intervened, but now it seems more a matter of when than if.