By Chris Barrett
A second team will join in Supreme Court action seeking a cache of documents from the NBL and its billionaire powerbroker, Larry Kestelman, as officials warn that a mounting feud with owners risks bringing down the league.
The case is being fronted by the Illawarra Hawks and its US owner, Jared Novelly, who have been embroiled in a dispute with the league over its ownership structure and financial transparency.
South East Melbourne Phoenix owner Romie Chaudhari. Credit: Eddie Jim
The league’s other teams have mostly kept their powder dry despite growing discontent, but according to sources with knowledge of the situation, speaking on the condition of anonymity, South East Melbourne Phoenix intends to join as a plaintiff when the discovery motion is heard in Sydney on Friday.
The club, whose ownership group is headed by US entrepreneur Romie Chaudhari and includes former Wimbledon finalist Nick Kyrgios and NBA player Dante Exum, is set to sign on despite teams being told they could be in breach of their licence agreements by taking on the league.
“We have become aware that Mr Novelly’s Crest is rallying a coalition of clubs and owners to support his campaign against the NBL and its leadership,” NBL chief executive David Stevenson said in an email to team owners.
“There is no doubt that this campaign is bringing the NBL, the league and the game of basketball into disrepute.”
Nick Kyrgios (right, pictured with Australian former NBL player Damian Martin) joined the ownership group of the Phoenix in 2023.Credit: Getty Images
Stevenson said he wanted to ensure teams were not “unwittingly induced to breach their own licence agreements for the purpose of legitimising the conduct of others”.
The Hawks are pursuing access to a trove of material from the NBL and Kestelman-owned companies linked to the competition, raising concerns about alleged conflicts of interest and the integrity of the league.
The club advised other team owners that, by law, they would need to join the discovery action to view any information secured via the court.
While warning them against that on Tuesday, the NBL suggested the current crisis posed an existential threat to the league.
Hawks owner Jared Novelly has publicly raised concerns about the running of the NBL.Credit: Dylan Coker/Australian Financial Review
“Illawarra and Mr Novelly have been on notice of the destabilising impact of their actions for over six months,” Stevenson said in his email to teams.
“The disregard for due process and breaches of legal obligations (including by improperly commencing court action rather than following the mandatory grievance process prescribed for all clubs and the NBL), have had a material impact on the NBL, its commercial opportunities and therefore all clubs.
“The matters playing out in the public arena are reminiscent of the conduct that almost resulted in the demise of the league before the league’s current ownership was asked to step in.”
Stevenson’s letter brought a sharp response from Perth Wildcats owner Mark Arena. He asked the CEO to confirm whether clubs that joined the court action would be viewed as bringing the league into disrepute and to assure teams they would not face retaliation if they shared concerns with Basketball Australia.
Larry Kestelman said this week that the “truth will prevail”.Credit: Getty
“In my view, if the NBL and basketball has been brought into disrepute, that is by the NBL’s own actions,” Arena replied, pointing to previous media reports that Novelly could be stripped of his licence.
Chaudhari, who co-owns a US Major League Pickleball team with Kyrgios and NFL superstar Patrick Mahomes, added in a further email to the NBL and team owners: “Amen … great points, Marc (sic), thanks for sharing!”
As well as Kyrgios and Dallas Mavericks guard Exum, the other co-owners of the Phoenix include five-time NBA All-Star John Wall and former NBA players Zach Randolph, Josh Childress and Al Harrington.
The NBL has called an urgent meeting of team owners and Kestelman on Thursday.
He has refused to budge so far as he has come under fire from Novelly’s company, Crest Sport and Entertainment, through which the incoming US ambassador to New Zealand and Samoa owns the Hawks.
Stevenson said a complaint made to basketball’s international federation made “unsubstantiated and baseless allegations of violations of FIBA’s code of conduct”.
FIBA has referred the matter to BA, which has asked the Hawks to reframe its complaint in line with its national integrity framework.
“The FIBA letter also sought to prevent Mr Kestelman’s involvement in the WNBL in circumstances where Crest unsuccessfully attempted to acquire the WNBL from Basketball Australia in 2024,” Stevenson told team owners.
“Ironically, Mr Kestelman has been accused of a conflict for holding interests in NBL clubs and the league (a fact publicly known prior to Mr Novelly’s investment into Illawarra) despite Crest previously holding an interest in the Bay Area Dragons and a significant interest in the East Asia Super League at the same time.
“Ultimately, clubs and owners should satisfy themselves that they are not prejudicing their own rights to pursue the personal gain of others.”
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