Saturday, May 15, 2021

Ex-Adidas Executive Gets 9-Month Sentence in Basketball Bribery Case

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A former Adidas AG executive was sentenced to nine months in federal prison Tuesday for his role in a scheme to bribe the families of top-ranked high-school basketball players to induce them to attend Adidas-sponsored universities, following a trial that detailed the corrupting role of money in college athletics.

Jim Gatto, who served as Adidas’s director of global sports marketing for basketball, was convicted in Manhattan federal court in October on three counts: wire fraud and wire-fraud conspiracy in connection with the University of Louisville, and wire fraud in connection with the University of Kansas.

Former Adidas consultant Merl Code and aspiring sports agent Christian Dawkins were also convicted in October on two counts related to Louisville. U.S. District Judge Lewis A. Kaplan sentenced Mr. Code and Mr. Dawkins to six months in prison.

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Lawyers for the three men sought leniency, saying they hadn’t intended to defraud the universities and asking Judge Kaplan to impose no prison time.

A lawyer for Mr. Code said that while he and his client were disappointed in the verdict and plan to appeal, the judge’s sentence was “very fair.” Lawyers for Messrs. Gatto and Dawkins didn’t respond to requests for comment Tuesday afternoon.

Adidas wasn’t accused of wrongdoing in the matter.

Prosecutors from the U.S. attorney’s office in Manhattan had sought a year of prison time for Mr. Gatto and eight months for Messrs. Dawkins and Code, saying their crimes had caused “significant harm.”

Robert Khuzami, the deputy U.S. attorney for the Southern District of New York, praised the sentence, saying in a statement that the scheme “not only defrauded multiple public universities but upended the lives of young student-athletes and corrupted a game cherished by so many.”

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The case grew out of a wide-ranging investigation into corruption in college sports. In September 2017, prosecutors unsealed charges related to three alleged schemes stemming from the yearslong probe, laying out allegations of backroom deals involving sports management, apparel companies and coaches that deeply rattled Division I basketball.

Messrs. Gatto, Code and Dawkins were found guilty of, among other matters, funneling tens of thousands of dollars to the family of one player to induce him to attend Louisville, in hopes that the player would ultimately sign with Adidas and Mr. Dawkins upon going pro. The player’s father testified at trial as a government witness, saying that his son hadn’t known about the payments, which ultimately sidelined his career.

A central question in the October trial was whether the men were trying to help the universities draw top talent—as the defense argued—or, as prosecutors argued, were defrauding the schools, which awarded the players athletic scholarships not knowing the payments to their families had rendered them ineligible under NCAA guidelines. The defense also argued that NCAA violations shouldn’t be treated as federal crimes.

In a victim-impact statement filed with the court, the University of Louisville wrote that the scheme had a harsh impact on the school’s students, alumni and employees, “whose beloved institution was relegated to a national scandal.” The school essentially fired its storied head basketball coach, Rick Pitino, after he was implicated (but never charged) in the scheme.

Mr. Code and Mr. Dawkins face another trial later this year related to another alleged scheme in which three assistant coaches have already pleaded guilty to soliciting bribes.

Corrections & Amplifications
Jim Gatto is a former Adidas AG executive. An earlier version of this article incorrectly referred to him as an Adidas executive. Prosecutors from the U.S. attorney’s office in Manhattan had sought a year of prison time for Mr. Gatto and eight months for Christian Dawkins and Merl Code. An earlier version of that sentence omitted Mr. Dawkins’s name and included Mr. Gatto in its place. U.S. District Judge Lewis A. Kaplan sentenced both Mr. Code and Mr. Dawkins to six months in prison on Tuesday. An earlier version incorrectly said Wednesday. (March 6, 2019)

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