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In meeting with Trump, Rockets owner details financial struggles and NBA’s return plans

Houston Rockets owner Tilman Fertitta, the chairman of Landry's Inc., speaks during a White House meeting Monday with restaurant industry executives as Trump senior adviser Jared Kushner listens. (Evan Vucci/AP)

During a White House meeting of restaurant industry executives Monday, Houston Rockets owner Tilman Fertitta expressed optimism that the NBA season will resume this summer while acknowledging that the novel coronavirus pandemic has “definitely brought [my business] back to earth.”

Fertitta, the billionaire CEO of Landry’s Inc., asked President Trump and Treasury Secretary Steven Mnuchin to “add a category” to the Paycheck Protection Program for the “larger private restaurateur” and to “do something with lease terminations” to provide his company financial relief during the pandemic. The 62-year-old explained that he had to lay off 40,000 employees from his chain of full-service restaurants in March and that he had recently borrowed “$300 million at 12 percent” interest because he “needed the liquidity to keep the company afloat.”

The comments were captured in a video posted by the Hill.

Last month, the Los Angeles Lakers applied for and received a $4.6 million loan through the PPP, which was administered by the Small Business Administration and was intended to help businesses with fewer than 500 employees. The Lakers, who were valued this year by Forbes at $4.4 billion, returned the funds but were heavily criticized for applying. Fertitta told Trump that he also had applied for and received PPP funding for Landry’s but that he “sent it back and did not spend a dollar of it” because he had been criticized for the layoffs and was worried that he would be perceived as “that billionaire who took the money from the little business.”

A sympathetic Trump referred to Fertitta as a “friend” and said the businessman’s restaurants “paid me rent for a long time.” Mnuchin said qualifying for the PPP was a “complicated issue.”

“We didn’t anticipate that the Los Angeles Lakers, who I’m a big fan of, would be taking a PPP loan,” he added. “As a result of that, there was a lot of backlash. We realize the issue, how it impacts your workers, and we’re sympathetic to that. This was a program for companies that were not necessarily quite as big.”

As Fertitta made his case, Trump interrupted with questions about the NBA’s return-to-play plans and about the Rockets, whom he called “a hell of a team” with “two great players” in Russell Westbrook and James Harden.

“I think what they’re doing is waiting to see what happens in certain states and if we’re going to be able to play,” Fertitta said when asked whether the NBA planned to resume play after indefinitely suspending the season March 11. “Making sure the virus continues to go in the right direction in the next few weeks. If things keep going the way that it’s going, I think the NBA, the commissioner, Adam Silver, who has done an unbelievable job through this, and the 30 owners will make the decision to try to start the season up again.”

Fertitta added that the league was considering playing some regular season games before proceeding to the playoffs.

“I think we would play some games to get it going again and create the interest,” he said, “then go right into the playoffs. I think it would be great for America. We’re all missing sports. Everyone wants to see these great NBA teams.”

The NBA and National Basketball Players Association announced last month that 25 percent of player salaries would be withheld during the shutdown beginning May 15, and the league is expected to lose more than $1 billion in revenue if the season can’t be resumed. Fertitta said the players “need to play to get paid” and that league owners “want that revenue” from televising games, even if they occur in empty arenas.

Under questioning from Trump, Fertitta said Westbrook and Harden each made nearly $40 million this season. The Rockets owner, who purchased the team from Leslie Alexander for $2.2 billion in 2017, then attempted to remind the panel about the financial issues facing his restaurant business.

“Russell and James both make $40 million a year and they were still getting paid, so a lot of my employees really wanted that PPP money,” he said.

Trump also showed an interest in Rockets General Manager Daryl Morey, who sparked a protracted controversy involving the NBA and China when he posted a message of support for Hong Kong protesters on his Twitter account in October. The Chinese government and Chinese businesses retaliated by taking NBA games off the air and by severing ties with the Rockets. Silver said in February that the standoff, which was fueled by the NBA’s refusal to discipline Morey, had cost the NBA as much as $400 million in revenue.

“I should have realized it was going to be a bad year for China when my general manager tweeted out ‘Freedom for Hong Kong.’ That started my year with China,” Fertitta joked.

Trump recalled the “ruckus” and inquired whether Morey, who joined the Rockets in 2006, was still employed. When Fertitta confirmed that he was, Trump said Morey “must be pretty good.”

“It’s a trick question,” Fertitta replied. “But he is.”

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