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Up and Down in Beverly Hills

Eccentric multimillionaire Donald Sterling has been a flaming success as an L.A. real estate mogul and a dismal failure as the owner of the Clippers

In the eerie silence of the empty foyer of Sterling Plaza, you can almost hear the grunts of the Hollywood tycoons who made and broke stars as casually as they lit and crushed out their cigars. MGM cofounder Louis B. Mayer built this Art Deco landmark in Beverly Hills 70 years ago, when the silents were turning to talkies.

The seven-story edifice, which boasts bronze-plated elevators, marble-lined corridors and formal parlors, could have been created by the set designer of Top Hat.

For more than a decade, the most opulent office space in 90210 has remained virtually unoccupied. The building's sole tenant is its landlord, Donald Sterling, whose billion-dollar real estate empire occupies the sixth and seventh floors. "Some people think I'm eccentric for keeping Sterling Plaza to myself," Sterling says. "I like riding up and down the elevators alone. It's a luxury I've earned."

With its sleek, gold-trimmed exterior and mostly vacant interior, Sterling Plaza neatly parallels another of Sterling's trophy properties: the Los Angeles Clippers. During his 18 years as owner--the first three in San Diego and the last 15 in glimmering L.A.--the franchise has been little more than a punch line for Sunset Strip comics. Under Sterling the Paper Clips have had exactly one winning season and have lost more than twice as many games as they have won. In the 1997-98 and '98-99 seasons the perennial cellar dwellers won a combined 26 games, and this season, despite a snazzy new arena (the Staples Center) and a snazzy new rookie (forward Lamar Odom), they haven't done much better (14-62 at week's end). So hapless is Sterling's team that after it beat the Toronto Raptors in an October exhibition game, Raptors forward Antonio Davis called a team meeting. "When you lose to the Clippers," he explained later, "it's time to stand up and say something."

Sterling, a spectacularly successful real estate baron who owns the Malibu Yacht Club, the Beverly Comstock Hotel and nearly half the apartments in Beverly Hills, speaks plaintively of his spectacularly unsuccessful team. "How do I handle losing year after year?" he says. "How do I cope with the ridicule? Let me ask you something: How would you cope with the ridicule?" Sterling has a way of lobbing people's questions back at them. He seems to do it not so much because he wants to elude hard questions but because he wants to know other people's answers.

"How do I cope?" he repeats. "It's very hard. I've suffered. Oh, how I've suffered. Do you know what it is to truly suffer?"

Do you?

"Yes, I suppose I do," says the 63-year-old Sterling. "The pain, the torment, the absolute torture! How do the owners of the Chicago Cubs get through it? How does anyone get through a difficult experience? I'll tell you how. You just keep going, keep fighting, keep living. Life goes on, and you hope it will improve."

It's fitting that Sterling set up shop in the House That Mayer Built. He seems benign and avuncular, but he has the furtive, feral charm of an old-time movie mogul. "I try to be warm and ingratiating with people and make them feel important," he says. "I never met anyone I didn't like. I'm very open, very honest, very caring."

Of course, the moguls of yesteryear were neither open nor caring. They were difficult, and Sterling has a similar reputation. Few Sterling hirelings utter a word--much less a discouraging one--about their boss. Chris Ford, who coached the Clippers from 1998 until he was fired in February, declines to comment on Sterling. Jim Todd, the man who replaced Ford, says only, "Elgin [Baylor] and Mr. Sterling have always been very supportive of me." Baylor, the Clippers' general manager, who as known Sterling for 15 years, limits his remarks to a terse, "He's always treated me great." Even Bill Walton, the team's outspoken TV color man, is mute on the subject of Sterling. About the only Sterling employee willing to go public is Lynn Lewis. "As an employer, he's tremendously loyal, magnanimous and compassionate," says Lewis, a Sterling assistant since 1994. "He's always ready to talk to you, to hear you out, to stand behind you. He treats everyone like family." Lewis ought to know. She is Sterling's kid sister.

For all his loyalty and magnanimity, Sterling is as eccentric as the next multimillionaire. (When Sterling moved the Clippers to L.A. in 1984, Alan Rothenberg, then the team president, said about his boss, "You're going to call him the Howard Hughes of the NBA.") In the living room of his Greco-American-South mansion in Beverly Hills, Sterling once conducted a get-acquainted meeting with a top draft pick and his agent Bob Guccione-style, wearing nothing but a bathrobe open to his navel. While entertaining friends at restaurants, he sometimes suggests entrees for others to order but doesn't get anything for himself. "The idea," says Michael Selsman, his former publicist, "is to make his guests share with him."

When it comes to pinching pennies, Sterling is an embarrassment of riches. Old NBA hands still talk about how he reportedly tried to cut costs during his first season by asking coach Paul Silas if the players really needed a trainer and if Silas would mind taping them before games. Sterling is also said to have proposed to trim the team budget for his second season by slashing training-camp expenses from more than $50,000 to about $100, scouting from more than $20,000 to about $1,000, advertising from more than $200,000 to less than $9,000 and medical expenses from about $10,000 to $100. (Sterling says he doesn't remember this, but Clippers executive vice president Andy Roeser, who wasn't around at the time, says, "None of these cuts were ever proposed.") Sterling saved money last season by not hiring a new coach until the six-month lockout was over. "Let's put it this way," says Ray Melchiorre, the team trainer from '96 to '99. "Going without a coach didn't make the Clippers any worse."

Sterling played his quintessential cheap trick in San Diego in 1981, just after he bought the team. As a goodwill gesture, he invited prominent lawyers and real estate agents to have lunch, meet the players and enter a foul-shooting contest: Win and take home a $1,000 prize. Among the attendees was lawyer Michael Spilger, captain of San Diego State's 1969-70 basketball team. Spilger made nine of 10, only to be told the offer had been rescinded. The new prize was five days and four nights in Puerto Rico. "There was one catch," says Spilger. "The deal didn't include airfare, transportation or food. I'd have to pay my own way." So Spilger told Sterling he'd take the $1,000. He remembers Sterling countering, "How about double or nothing?"

"No thanks, I'll take the $1,000."

Next, according to Spilger, Sterling asked if he'd settle for two season tickets, and Spilger said, "I already have some." So Sterling promised him that the team's promotions department would work things out. Two weeks later, Spilger got a letter congratulating him for winning the top prize: Three days and two nights in Las Vegas. Unpaid but unbowed, Spilger sued the Clippers for fraud. At the home opener in '82, a team official tracked him down and offered a compromise: a $1,000 donation to his favorite charity. "I'll see you in court," said Spilger. Two days later--and more than a year after he sank his free throws--he got his money.

The Clippers' rebuilding program is in its third decade. They are lottery regulars, and Sterling has held at least two lottery parties at his Beverly Hills estate. The galas were the highlight of the Clippers' season. Sterling has often prepped for his parties by placing newspaper ads for "hostesses" interested in meeting "celebrities and sports stars." Prospective hostesses have been interviewed in the owner's office suite. One former Clippers coach recalls dropping in on Sterling during a cattle call. "The whole floor reeked of perfume," he says. "There were about 50 women all dolled up and waiting outside Donald's office, and another 50 waiting outside the building. The chosen few got to dress scantily, mingle with C-list actors and serve wine in plastic cups."

Sterling has been the one constant through the years, so it's easy to blame the team's failure on him. "The truth is," says Carl Scheer, the team's general manager from 1984 to '86, "there have been a lot of bad decisions by people who've worked for him, including me."

Those decisions have ranged from bad draft picks to bad trades to bad contract negotiations that radiated bad vibes. "Being a Clipper can be real tough," says retired point guard Pooh Richardson, who toughed it out with the Clippers from 1994 to '99. "It's almost a given that you won't win and that the team won't hold on to its best players." Indeed, not one of Sterling's nine lottery picks before 1998 re-signed with the team. Typically, the Clippers draft a promising player, nurture him and then watch him bail as soon as he's a free agent, spreading their lottery legacy throughout the league.

"To have a decent team you need to keep a core of players together and let them grow," says Los Angeles Lakers guard Ron Harper, a survivor of five Clippers campaigns. "Sterling doesn't do that. He's not a builder, he's a meddler."

Actually, Sterling doesn't so much meddle as delay. He hedges. He vacillates. He agonizes. "Most NBA owners are distant and aloof and give only the pretense of being in control," says player agent Arn Tellem, general counsel of the Clippers from 1983 to '89. "Donald is so angst-ridden and vulnerable, you just want to hug him. He's constantly seeking the advice of others."

He hardly ever follows it, however. He tends to throw everything into committee, where there's rarely a consensus. "Front-office meetings are like the Israeli Knesset," Tellem reports. "There are usually more opinions than people in the room."

To Scheer, "the most frustrating part of being G.M. was the lost opportunities. Sterling didn't trust his own basketball judgment and wasn't prepared to accept mine. I'd call him about a trade I wanted to pursue, and he'd say, 'Let me get back to you.' He'd never get back to me. So nothing would happen."

In the NBA success on the court demands a readiness to pounce and a willingness to spend. The Clippers payroll--$26.3 million--is the third-lowest in the league and roughly half that of the Lakers. "If you've got a bad team, you'd better have a low payroll, so you'll be able to sign free agents under the cap and get better," says Chicago Bulls owner Jerry Reinsdorf. "Donald is in a great position if he spends wisely."

So far Sterling has shown no interest in spending, period. "Cash is the root of all evil, and Sterling likes to hold on to his," says Harper. "He won't hand it out to a player unless he thinks the player has earned it. Well, that's not how things work in today's NBA. Like it or not, an owner has to overcompensate his players."

Harper was the Clippers' second-highest scorer during the semiglory years of 1990-91 and '92-93, the only seasons besides 1996-97 that the team has made the playoffs. Even if all the star power the Clippers could muster at courtside was Billy Crystal, they seemed to be turning a corner. Then the other starters and coach Larry Brown left. "Suddenly it was just me," Harper says. "I was the last man standing on a ship that was going down."

Harper signed for one year at $4 million in '93, becoming one of the few big-ticket free agents in Clippers history to re-up. In a league rife with eight-figure salaries, $4 million--a sum that some teams dole out to a backup center--remains the most Sterling has paid a player. The Clippers tried to re-re-up Harper in '94 by offering him a five-year deal for $16 million. The Bulls offered him five years at $20 million. "Sterling's people tried to convince me their offer was better," Harper says. "I told them, 'It sounds $4 million worse.' Finally they told me, 'O.K., go ahead, have fun.' And I told them, 'I will.'" Harper laughs raucously and says, "I got three championship rings in Chicago, so I can't be mad."

Many people believe that Sterling is playing a different game from the rest of the NBA owners. "I don't know how important winning is to Donald," says Scheer. "He seems more concerned that his books are balanced, that he runs one of the few NBA franchises with no debt, that he can bring his friends to games." Those friends--a mix of Friars Clubbers and Merv Era celebs--show up en masse at Sterling's Malibu White Party, the extravagant tented barbecue-and-bubbly beach bash he often throws at his second home, a neo-Tudor oceanfront bungalow. The party is so named because guests are encouraged to dress all in white, as in The Great Gatsby. "Sterling's agenda is as much social as professional," says Los Angeles Times sportswriter Mark Heisler. "He loves the status that owning even a bad team confers."

He also enjoys the publicity he's received as a philanthropist. Southern California charities routinely fete Sterling as their Humanitarian of the Year. Since 1997, the title has been accorded him by the Vista Del Mar Orphanage, the Special Olympics, the Los Angeles Yeshiva, the Asthma and Allergy Foundation and the L.A. Police Historical Society. Not that every charity has found it easy to separate Sterling from his swag. Linda McCoy-Murray recognized that last summer when she phoned him to help sponsor a golf tournament in honor of her late husband, venerated L.A. Times sports columnist Jim Murray. Every pro franchise in California, according to McCoy-Murray, had forked over at least $5,000 to her foundation, which provides journalism scholarships. Every pro franchise, that is, except the Clippers, which had memorialized Murray on the final page of last season's media guide. Sterling offered McCoy-Murray two season passes. "You know, that's wonderful," she remembers telling him, "but we're trying to endow a college scholarship fund. We could really use cash."

Sterling, she says, replied, "Those two tickets have a face value of $4,000!"

"Fine," she said. "We can use the tickets for our silent auction. But would you also consider donating $5,000?"

Sterling said he would mull it over and call her the following week. He never did. Nor did he send over the season passes. "I decided against calling Donald back," says McCoy-Murray. "I wasn't going to go chasing after the almighty dollar. I feel bad for the [Clippers] organization. I think everybody in L.A. does."

Selsman thinks that Sterling's retentive streak is rooted in the poverty of his youth. "As a kid, Donald never had enough of anything," says Selsman. "With him, acquiring great wealth is a crusade. He's psychologically predisposed to hoarding."

Born Donald Tokowitz, Sterling is the only son of an immigrant produce peddler. When Donald was two, he and his parents, Mickey and Susan, left Chicago for Boyle Heights, then a poor Jewish enclave in East L.A. Every day at 2 a.m., Mickey would go to a farmer's market to buy vegetables wholesale and truck them to restaurants. Young Donald worked as a grocery-store box boy, investing his meager wages in toy soldiers and comic books. His mother wasn't impressed. Unlike property, she reasoned, education can never be taken away. "You will go to college!" she would tell her boy, pounding her fist on the dinner table. "You will be a professional. You will be a lawyer."

The ever-dutiful Donald obeyed Mom's will. In his senior year at Roosevelt High he was elected class president and went to the city finals as a gymnast. "My brother was very popular," says Lynn Lewis. "He could win you over any way he wanted." He went to the people's colleges--Cal State L.A. and Southwestern University School of Law, graduating from the latter cum laude in 1961, at age 23. To help pay his way through, he moonlighted as a salesman at a furniture store. It was then that he changed his name to Sterling. "I asked him why," a fellow salesman told Los Angeles magazine in 1999. "He said, 'You have to name yourself after something that's really good, that people have confidence in. People want to know that you're the best.'" Sterling made Tokowitz his middle name and Shelly, the boss's daughter, his wife. The couple, who are still married, would raise three children.

Sterling did not ascend unfettered in the legal profession. Back then big L.A. law firms rarely hired Jews, especially penniless ones with degrees from Southwestern. So Sterling hung out a shingle in Boyle Heights and became a tireless advocate for his old neighbors, handling everything from divorces to personal injury cases. Ten thousand cases by his count. He was so successful that within a couple of years he shifted his shingle to Beverly Hills.

At the precocious age of 27, Sterling represented Selsman in a headline-grabbing divorce from actress Carol Lynley. "Donald took on the top legal talent at the Music Corporation of America," says Selsman, "and wouldn't back down." (Selsman and Lynley wound up splitting their assets equally.) Bigger clients and bigger judgments followed, and soon Sterling had parlayed his fees into a handsome real estate portfolio. He made his bundle in two ways: gradually and then suddenly. Eschewing brokers, he stuck to a few affluent areas, invested when the market was soft, refinanced as the properties appreciated, and reinvested. He got tax breaks for reinvesting and reduced his capital gains taxes and transaction fees by never selling. His simple credo: Buy it, improve it, keep it forever.

Improving it--at least cosmetically--allowed Sterling to jack up the lease. In 1986 he hiked rents on his Beverly Hills properties so dramatically that outraged tenants marched on City Hall. "These days Sterling keeps up his buildings, but it's almost impossible to get a security deposit back," says tenant-rights activist Herm Shultz. "He was a very cunning and ruthless businessperson, and he hasn't changed his stripes any. We're talking about the Humanitarian of the Year."

As a tenant, Sterling is just as cunning. He doesn't own the land on which Sterling Plaza stands; rather, he has a 99-year lease with the Mayer estate that requires him to pay a relatively small annual fee and 15% of any rental income. But he won't rent to anyone. With no other tenant, the Mayer estate faces another 75 years with virtually no income from its Sterling Plaza property. By sitting and waiting, Sterling may force a fire sale.

Twenty years ago Sterling bought 11 Santa Monica apartment complexes from real estate magnate Jerry Buss, who used the money to buy the Lakers. Buss pitched pro basketball as the great investment of the '80s and encouraged Sterling to go after the Clippers, a full-court mess entropying in San Diego. The asking price was $13.5 million, but Sterling got the team on a layaway plan by assuming nearly $10 million in debts and deferred compensation. Sterling tried to remake the Clippers in his own image, plastering pictures of himself on billboards all over town. "It's the start of a new era!" he promised in an open letter to fans. "I'm in San Diego to stay and committed to making the city proud of the Clippers. I'll build the Clippers through the draft, free agency, trades, spending whatever it takes to make a winner."

Fans started wondering about Sterling's new era at his first home opener, in 1981. The Clippers won the game, but Sterling outperformed his players. He cheered wildly from his courtside seat, his shirt unbuttoned to the waist. As the game ended, he sprinted across the floor with his wine glass in hand and jumped into the arms of coach Silas. Then he high-fived his players, telling each, "I love you." During that '81-82 season, as the Clippers went 17-65, Sterling's antics were more entertaining than those of his woebegone team. Silas returned from a goodwill trip to China in the summer of '82 to find his files stacked up in the hallway outside his office. Sitting at the coach's desk was Sterling's close friend Patricia Simmons. The former model had been appointed assistant general manager, though the Clippers say she had no basketball duties.

Sterling's reign of error soon got costly. The league fined him $10,000 for publicly suggesting that the Clippers lose games to enhance their draft position. He did his part by refusing to add players when injuries reduced the roster to the league-minimum eight. The Clippers came close to forfeiting a game after forward Michael Brooks had oral surgery. Brooks had to suit up, and he actually played, though his jaw was as swollen as Sterling's ego.

No draft choice could right the Clippers, and in 1984 Sterling moved them to L.A. But he failed to seek the NBA's approval for the relocation, and the league fined him $25 million. Sterling sued the league for $100 million and withdrew the suit when the league agreed to reduce his fine to $6 million.

During their first season in L.A. the Clippers won only one more game than they had in their last season in San Diego, but they averaged almost 4,000 more fans at the Sports Arena, where the Lakers had played before moving to the Forum. That still put them near the bottom of the league in home attendance. Things haven't improved; the Clippers have had the league's lowest attendance each of the last six seasons and rank 28th out of 29 teams this season. "The one thing you have to admire about Donald is that he's loyal to Los Angeles," says Tellem. "He's passed up many opportunities to sell the team or move elsewhere for a lot more money." In the mid-'90s Sterling turned down a $95 million offer to move 35 miles southeast to Anaheim, partly because he hates traffic. Not long after that an ownership group in Nashville reportedly made an overture worth almost $200 million, which Sterling also rebuffed. "I never sell anything," he says. "I'd prefer to stay in L.A. and lose money than move and make a fortune."

Ticket prices seem to confirm this. An end zone loge seat at the Staples Center for a Clippers game goes for $40; the same seat at a Lakers game fetches $60. Sitting courtside with Crystal will cost you $350; the identical seat in Jack Nicholson's row will set you back $1,150. "The Clippers are the people's team," says Steve Soboroff, who as senior adviser to Mayor Richard J. Riordan played a role in bringing them to the new arena. "Sterling has given fans who can't afford Lakers tickets a chance to see NBA basketball at a reasonable price."

Other observers aren't so charitable. Sterling's formula, according to one critic, is to inspire fans' dreams without ever fulfilling them. "At some level Sterling must be content being the losingest NBA owner ever," says David Falk, agent for Clippers power forward Maurice Taylor. "All the criticism he has gotten hasn't changed the way he runs the team one degree."

Whether because of Baylor's poor judgment or Sterling's meddling, or both, the team's draft choices have been disastrous. In 1987 the Clippers selected Reggie Williams with the fourth pick. Think they'd have been better off if they'd chosen Scottie Pippen or Reggie Miller instead? Or how about 1989, when the Clippers had the second draw and chose Danny Ferry, passing on Glen Rice? Ferry bailed immediately for Italy, and Rice became an All-Star Game MVP. One more: In 1990 the Clippers looked past Jayson Williams, Dee Brown, Tyrone Hill and Toni Kukoc and got Bo Kimble out of nearby Loyola Marymount.

Last year, when the draft didn't have enough marquee players to excite Sterling into ignorant interference, Baylor snagged the 19-year-old Odom with the fourth selection. It was the kind of thought-out risk that makes teams winners. "Donald Sterling had absolutely nothing to do with getting Odom," Baylor says testily. "That pick was mine and mine alone."

Baylor has reason to be testy. Sterling has a history of Clipping his wings, most famously in 1993 when Baylor tried to make a trade with Miami. Danny Manning, then the Clippers' star forward, had a year left on his contract and was angling to get out. Baylor made a deal with the Heat: Manning for Rice and Willie Burton. Sterling, certain he could sway Manning to stay, showed up at training camp and pleaded with him. Manning listened politely. "He's softening!" Sterling told team officials and called off the trade. Four months later, with Manning no softer, Sterling relented. The 27-year-old was swapped to Atlanta for free-agent-to-be Dominique Wilkins, who was 34. Wilkins carried the Clippers over the last half of another dismal season, then rejected Sterling's new contract offer, which was half of what Dominique had demanded. Wilkins left, and the team was left with nothing.

From a penthouse window in Sterling Plaza, the five-time Humanitarian of the Year gazes out at Los Angeles with mournful, drooping eyes that seem to have witnessed all human sadness. "Basketball is the only aspect of my life in which I haven't been a winner," he says. "I want to win badly, I really do. It hasn't happened yet, but it will. Don't you think it will?" You tell him you have no idea. "Yes, well, I think it will," he says. "It must. It simply must."

He settles into a chair behind a cluttered Louis XIV desk on which a bronze placard sits: may we always laugh, dance and sing our way through life. He meets your stare, his eyes less menacing than searching, and tells you he'd rather discuss the bright Clippers future than the blighted Clippers past. You mention Taylor--whose contract Sterling has refused to extend for six years at $71 million, the maximum allowable--and ask if Sterling thinks the player will follow through on a recent promise to bolt. "Taylor will only bolt if we want him to bolt," Sterling says without much conviction. "No player ever left the Clippers that we didn't want to." Still, you say, the Clippers again stand to get nothing for something. "I only pay superstar prices for superstar players," Sterling says, wincing at this unhappy thought. "You don't think Taylor is a superstar, do you? He's not a superstar."

What about Odom?

"He's going to be a superstar," Sterling says, "and when he becomes one, I won't let him get away." What if you realize too late that he has become one?

Sterling's shoulders shift. An awkward silence follows. You bring up Buss, who has won five NBA titles by paying superstar prices for everyday players. Sterling says he admires Buss but doesn't measure his team against the Lakers. "Let's say you take your child to see Shirley Temple onstage," he says. "And let's say you tell yourself, Wouldn't it be nice if that was my child up there? And you think, My child will never be Shirley Temple, but I love her all the same. So you send her for dancing and singing lessons and hope that one day she'll have all the qualities you admire in Shirley Temple. But she'll never be Shirley Temple." He leans back in his chair trying to relax, looking slightly pained. "I'm only as good as my advisers," he says.

So why not hire new ones? "Part of the reason is loyalty to my G.M.," he says. "I like Elgin, I respect him and trust him. I want to give him a chance. I want to see him succeed. Some people think the solution to everything is change. I like continuity." He gives a dry smile. "Have we made the right decisions in drafting? Presumably not. Have we made a lot of mistakes? Yes, we've made a lot. Have we learned from our mistakes? I hope so. At times, I feel as if I were a scientist making progress toward the cure of a disease, yet the lab mice keep dying of cancer."

Earlier that day, in the lobby of a Beverly Hills hotel, Barry Dean, an old friend of Sterling's, had tried to solve the riddle of the NBA's greatest tale of futility. "After all these years as an owner, Donald still doesn't know how to run a team," Dean said. "His problem is he doesn't know that he doesn't know, and won't hire someone who does know. You know when the Clippers will be successful? When Donald finds out what he doesn't know."