Michael Beasley’s lawsuit alleges he received improper benefits


Minnesota Timberwolves' Michael Beasley stretches before playing in the Beasley Classic on OCt. 21. (Jim Mone/AP)
October 26, 2011

A Maryland-based sports agent and a youth basketball power broker conspired to foster a relationship with NBA player Michael Beasley from the time Beasley was 14 years old with the intent of securing the rights to represent him professionally, according to a civil suit filed by Beasley in Montgomery County Circuit Court.

Beasley asserts in his suit that Bell Sports Incorporated President Joel Bell bankrolled Curtis Malone’s nationally recognized DC Assault summer basketball program and that in return Malone felt obliged to steer Beasley, the No. 2 overall pick in the 2008 NBA draft, to Bell for professional representation. Beasley’s suit contends that, along the way, Bell and Malone violated NCAA rules and federal laws governing agent conduct.

Beasley’s accusations are part of a countersuit against Bell and a third-party claim against Malone filed Sept. 27 in Montgomery County Circuit Court in response to a Jan. 21 breach-of-contract suit filed by Bell Sports Inc. against Beasley. Bell’s original suit claims Beasley wrongfully terminated his representation agreement with Bell Sports Inc. just prior to signing an endorsement deal with Adidas.

Bell declined to comment and referred all questions to his attorney, Glenn C. Etelson, who did not respond to numerous requests to comment for this story.

Malone did not return a cellphone message, but his attorney, Bill Heyman, said, “Mr. Malone absolutely denies the allegations of impropriety made against him in the third-party complaint.”

The legal wranglings provide a window into the tangled world of youth basketball, in which talented teenagers become prized commodities and relationships are cultivated through unregulated third parties. Several prominent college basketball coaches, summer-league coaches and representatives of sports agencies have privately said such arrangements between agents and summer-league coaches have become commonplace over the past decade. All spoke on condition of anonymity to protect professional relationships with the other parties.

Beasley’s countersuit is the most public assertion of such an arrangement. In it, Beasley’s mother, Fatima Smith, describes Malone as Bell’s “runner,” which is a term commonly used in basketball circles to describe individuals who act as intermediaries between agents and players.

Beasley’s lawsuit contends that Bell’s relationship with Malone and payments to Beasley’s mother were “intended, ultimately, improperly to induce Beasley into executing a player agent agreement without competition from other agents.”

When asked to provide evidence that supports the allegations, Beasley’s attorney Mark A. Smith said, “I am confident that, should this matter go to trial, I will have sufficient testimonial and documentary proof of the allegations made in the counterclaim. . . .

“As of right now, I cannot produce all the evidence I expect to have.”

Asked to corroborate some of the allegations in the suit, Fatima Smith declined to comment for this story.

Barring a settlement, the court must decide whether Beasley is a 22-year-old trying to avoid paying Bell his commission by firing him after he had virtually completed his work. In the case of Beasley’s countersuit, at issue is whether the player was denied appropriate representation by people seeking to cash in on relationships built during his teenage years.

Beasley and Bell are due in court for a motion to compel discovery and show cause hearing on Monday. A pre-trial hearing and settlement conference are scheduled for Nov. 3.

Early attention

Malone consistently has attracted and produced talented players who have gone on to star for major college programs. Just in recent years, multiple DC Assault players have played for nationally renowned coaches such as Georgetown’s John Thompson III and Duke’s Mike Krzyzewski.

Between 2005 and 2009, DC Assault, which like many top summer-league programs was set up as a 501(c)(3) public charity, received a total of $598,250 in contributions and grants, according to the program’s 990 tax forms that were filed to the Internal Revenue Service. And like all top summer-league programs, DC Assault does not list any individuals who made contributions.

According to Beasley’s lawsuit, his mother first met Malone in November 2002 through Trevor Brown, Beasley’s eighth-grade coach at National Christian Academy in Fort Washington. Playing for an influential power broker such as Malone allowed players to travel the country to compete in high-profile events and, ultimately, to be seen by hundreds of college basketball coaches looking to recruit talented players.

Smith told the summer-league programs recruiting her son that she was a “struggling single mother” unable to afford the costs of Beasley’s participation, the lawsuit alleges.

According to the suit, Malone told Smith that she did not need to worry about “paying for anything” — including Smith’s transportation and lodging if she wanted to travel to games — because his program was sponsored by Adidas, a shoe and apparel company that funded many top-tier summer-league programs.

After Smith chose to have Beasley play for DC Assault, the lawsuit alleges, her travel and lodging were paid for consistently, and sometimes her children’s expenses were paid for, as well.

Dalonte Hill, Beasley’s coach with DC Assault and Kansas State and currently a Maryland assistant coach, has known Beasley since the player was 12 years old. Hill said in a telephone interview Monday that he did not recall Smith at any of Beasley’s out-of-state summer-league events.

According to the suit, Bell entered the picture in early 2003, after Smith was pulled over while driving on a suspended license. Needing money for a lawyer, she contacted Malone, who directed her to meet him at Houston’s, a restaurant in Rockville.

According to the suit, Malone was accompanied by “a man [Smith] had not met before, whom she later came to understand was Bell.” Upon departing the restaurant, the lawsuit alleges, Smith watched Bell reach into his inside pocket and pull out an envelope, which he handed to Malone then gave the envelope — which contained $2,500 in cash — to Smith, the suit alleges.

Beasley attended six high schools in five years — from Maryland to North Carolina to Florida to Virginia to Massachusetts. He acknowledged in the suit that he had behavior problems in school and struggled to focus. But throughout, he was widely regarded as one of the nation’s best teenage basketball players.

College days

When the time came to choose a college, Beasley committed to Kansas State, where Hill had been hired there as an assistant, and the countersuit depicts Malone and Bell taking measures to ensure that Beasley would remain in their hold during the year before he turned professional.

Beasley’s suit says he and Hill “were close” but said that Hill also remained a close friend of Malone.

“Mike needed a brother and a father in his life,” Hill said in an interview this summer. “Curtis was the father, and I became the big brother figure. He would feel comfortable opening up to me.”

Hill said he was surprised that Smith moved to Kansas to be near Beasley.

Malone encouraged Smith to move to Kansas with Beasley “to, among other things, keep other agents away from him,” the suit says. In June 2007, a man whom Malone had introduced to Smith — but whom the suit does not name — paid for Smith’s moving expenses to Kansas and made a “lump-sum payment to cover the first six months of her rent while she was there,” the suit alleges.

In January 2008, the suit claims, the man telephoned Smith and told her that he wanted to be Beasley’s financial adviser. Smith called Malone and informed him about the conversation. Malone said “something dismissive about him and told Ms. Smith to be at ease,” the suit says.

Shortly afterward, according to the suit, Bell called Smith and asked her the amount of her rent and her car payment and told her that both payments would be taken care of. Smith said they were paid for, and that she never made a rent or car payment during Beasley’s entire freshman year as a player for Kansas State during the 2007-08 season, the suit says.

Hill said he was unaware of Smith receiving payments from anyone.

“No, Fatima had a full-time job,” Hill said. “It was not like she moved to Kansas and stopped working. She continued to work. She had a family, so I never assumed. She didn’t buy a house. She rented a house, which later some kids rented. So I didn’t think it was extra. Normal living.”

NCAA rules prohibit student-athletes from receiving any inducement from agents. The Sports Agent Responsibility and Trust Act, a federal law passed by Congress in 2004, prohibits “providing anything of value to a student-athlete or anyone associated with the student-athlete before the student-athlete enters into an agency contract, including any consideration in the form of a loan, or acting in the capacity of a guarantor or co-guarantor for any debt.”

After Smith and Malone discussed her interaction with Bell, the suit claims, Malone told Smith that Bell had “taken care of [Malone] for years and that now that he was in the position to offer Beasley, the best player in the draft, to [Bell], he was going to do that. Malone acknowledged that Bell was not the best agent, but he stated that he was not the worst, either.”

Malone told Smith that he “felt he owed it to [Bell] to deliver Beasley,” the suit says.

Hill said he was not aware that Malone, or anyone, tried to steer Beasley to Bell. Hill recalled Beasley meeting with other agents during his selection process.

“I know Curtis runs a program,” Hill said, “and not every kid in his program expected to go to the NBA. And he makes sure every one of his kids goes to college. Sometimes he gets perceived like he is in it for the money. But if he is in it for the money, he has had enough players go to the NBA where he should reap the reward and not have these allegations be looked at like this.”

Going pro

After completing his lone season at Kansas State, one in which he tallied the third-most points and second-most rebounds among freshmen in NCAA history, Beasley declared for the NBA draft. On April 26, 2008, Beasley signed a contract that allowed Bell to serve as his player and legal representative.

The suit alleges that Malone, whom Beasley trusted, directed the player to sign with Bell.

It is common for top-tier college basketball players preparing for the NBA draft to seek and receive counsel from influential non-family members on matters such as which agent to choose. But Beasley alleges in the suit that Malone “conspired with Bell to drive Beasley to him as a client” and that Bell “improperly subsidized Malone’s DC Assault program, and paid money to Malone ‘on the side’ or ‘under the table,’ in exchange for” Malone advising players such as Beasley to sign with Bell.

One of Beasley’s first requests of Bell, the suit says, was for the agent to quickly secure Beasley a multimillion dollar endorsement contract. Beasley says in the suit that he wanted a contract with Nike, the long-standing leader in the multibillion dollar shoe and sports apparel industry the past 30 years.

But Beasley’s suit claims that Bell “failed to pursue negotiations with Nike based on pecuniary interests that would result from Adidas to [Bell] and Malone.”

Upon learning through a third party that Bell and Malone had been providing financial assistance to his mother for years, the suit says, Beasley felt “betrayed” by both men.

On Sept. 10, 2008, prior to the start of Beasley’s rookie NBA season, Beasley filed notification to the National Basketball Players’ Association that Bell no longer was his agent. Two weeks later, Beasley signed an endorsement contract with Adidas.

Unamicable split

Bell’s lawsuit, filed in January, offers a dramatically different account of how he and Beasley became estranged. Bell contends that Beasley breached the representation contract he signed in April 2008.

For roughly five months in 2008, Bell’s suit says, Bell engaged in negotiations with Adidas to procure an endorsement deal between the shoe company and Beasley. By September 2008, the negotiations were nearly complete, the suit states.

But just before the deal was finalized, the suit says, Beasley “without cause, wrongfully terminated [Bell] as his agent with the sole intent to avoid paying [Bell’s] commission.”

According to the contract Beasley initially signed with Bell — a copy of which was submitted as an exhibit in Beasley’s countersuit — Beasley was obligated to pay the agent 20 percent of all of his compensation.

Beasley, who was traded from Miami to Minnesota last summer, fired Bell two weeks before signing an endorsement contract with Adidas. The deal expired this summer, and the company chose not to renew, according to an Adidas representative.

Bell’s lawsuit describes the endorsement deal Beasley eventually signed with Adidas as “substantially similar, if not close to identical,” to the one negotiated by Bell. The only significant difference, Bell alleges, was that Bell had arranged for a smaller up-front fee with a longer overall contract term.

Bell’s lawsuit makes no mention of Beasley’s purported desire to sign an endorsement deal with Nike. It also does not address Bell’s relationship with Malone, the process by which the agent came to know Beasley or the financial assistance Bell allegedly provided to Fatima Smith, prior to Beasley agreeing to become Bell’s client.

Staff writers Dan Morse and Michael Lee contributed to this report.

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