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Wednesday, August 15, 2007
Tim Donaghy to Plead Guilty: What Will be The Fallout?

According to the Associated Press, former NBA referee Tim Donaghy will plead guilty in federal court later today to charges that he bet on games he officiated. It's not yet clear which specific charges he will plead guilty to, or how much, if any, prison time he faces, but among related criminal offenses are mail and wire fraud; racketeering (under the Racketeer Influenced And Corrupt Organizations Act (RICO), 18 U.S.C. § 1961 et seq., which is a general law against bribery and racketeering, and normally involving organized crime); conspiracy to commit sports bribery (under 18 U.S.C. § 224); and interstate travel with the intent to commit bribery (under 18 U.S.C. § 1952).

What might a guilty plea mean? There are different possibilities.

One is that investigators enjoy an overwhelming amount of evidence against Donaghy and he feels that he is better off cutting a deal early than having the investigation continue. This would probably be the best outcome for the NBA: Donaghy as an isolated bad guy, with the league being able to go back to business as usual. Early indications, based on media leaks from investigators and/or NBA officials, are that no other officials or players will be charged, so this may be the correct explanation.

Another possible explanation is that Donaghy is worried about his safety, and that of his family, from mafia threats, and the sooner he ends the litigation, the better for him and everyone around him. Certainly, the mafia have been known to intimidate witnesses and their loved ones, but I'm not sure how often that actually happens, or whether it has happened here.

The most worrisome explanation for the NBA would be that the NBA betting ring extends beyond Donaghy, and investigators want to expose it. Maybe they are offering Donaghy lighter charges in exchange for "spilling the beans," so to speak. That is pure speculation, of course, and early indications are that other officials and players will not be charged. But what investigators leak to the media early on doesn't always prove true, and if Donaghy is indeed cooperating with investigators to expose a league-wide problem, his guilty plea could prove devastating for the NBA, and particularly for top NBA officials.

As I wrote about on and on Sports Law Blog, David Stern has attempted to portray Donaghy as the bad apple--"the rogue, isolated criminal," in Stern's words--in an otherwise good barrel. That is corporate management 101 whenever an employee is found to have done something wrong: immediately distance the employee from the organization, not only to protect the organization, but to protect those running it. We also see that same modus operandi when there is a hazing incident at a college campus, as once school administrators realize that defending the offending students will not work, they often try to place all of the blame on those students, even though the same hazing rituals had been going on at the school for years. To some extent, I suspect much of the "personal responsibility" rhetoric that we hear now-a-days is driven by the same tactic: get others to believe that fault should rest entirely with the individual (e.g., "an obese person is overweight because he or she 'chooses' to eat too much") to avoid considering more difficult questions of causation and social responsibility (e.g., prevalence of fast food restaurants, psychology of marketing, economic explanations etc.--see our series of food and drug law posts on The Situationist).

But back to Donaghy, what if, contrary to initial reports, other officials and/or players are in fact involved? What if the NBA has harbored suspicions about this for a while, and not done anything or not done enough? Indeed, as detailed by Henry Abbott on TrueHoop, numerous recent news stories discuss different angles of possible NBA corruption. If Donaghy's guilty plea indicates governmental interest in that same topic, we might, at the least, see more vehement calls for congressional hearings (which I blogged about here); at the worst, we might see other officials and players facing charges, and top league officials facing resignations.

Of course, there is no indication at this point that other officials or players will be charged. Moreover, Donaghy is not exactly the most reputable witness around, so whatever he says should be taken with caution. But investigators already know that. And they also know that none of this looks good for the NBA, which, despite its new slogan, may not feel so "amazing" by the end of the Tim Donaghy affair.


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