Howard Schultz Gave Out $3.50 Starbucks Gift Cards: An Insider's Notes On The Shabby Death Of The Seattle SuperSonics

For those fans who believe that the only acceptable NBA champion is any team that's not the Miami Heat, the tempting choice is Oklahoma City. The Thunder have Kevin Durant's superlative set of skills, Russell Westbrook's freakish athleticism, and James Harden's 1840s prospector's beard. They are young and charming, and they seem like the ideal foil for the soulless South Beach superteam.

But where LeBron-loathing folks now see the forces of good on the court in Oklahoma City, I have always looked to the owners' box and seen Clay Bennett and his pals, the Oklahomans who stole the Seattle SuperSonics from a city that loved and supported NBA basketball for 41 years. The theft was the final chapter in a grim tale of arrogance, incompetence, and deceit, with the Okies spending more than a year deceiving Seattle fans, city officials, and even the team's front office about their ultimate intentions.

As a Sonics employee, I was there on the inside, living through—and sometimes participating in—the subterfuge. And I was there for what came before, as the last local owner, spineless Starbucks mogul Howard Schultz, allowed his ego and greed to ruin the team's hopes. The demise of the Sonics was a slow implosion, and I watched it up close. Maybe I was too close, because it's only now dawning on me—four years after the Sonics became the Thunder—what really happened to our team.

* * *

I grew up a Sonics fan, in the suburbs of Seattle, enraptured by the Payton-to-Kemp era of the team. But as the millennium closed, that glory waned. The Sonics' lone NBA title was receding in civic history, like the Metropolitans' 1917 Stanley Cup, and the Mariners had taken over the part of the municipal psyche previously occupied by basketball. The 1999 lockout hamstrung the team's ownership at a time when the Sonics were still paying off their mid-1990s renovation of the Seattle Center Coliseum. Finances became so tight for owner Barry Ackerley—the media mogul who'd made his fortune through billboards and radio stations across America—that he had to sell the team to a group of investors, led by Starbucks's Howard Schultz, in 2001.

I first joined the staff as an intern in 2002. With the coffee impresario at the helm, fans had reason to feel optimistic. Schultz spun tales about his hoophead youth in Brooklyn. He vowed to return the team to prominence and embraced the past, going so far as to bring back the club's classic green and gold colors. He would hold confabs with local business leaders before games at the arena, sharing his management philosophy from the court to a rapt crowd in the stands. I was the guy scrambling around with a microphone so attendees could petition Schultz for guidance on "branding" and "guest relations." Schultz would drone on about how the team and his ownership was a "public trust."

Howard Schultz Gave Out $3.50 Starbucks Gift Cards: An Insider's Notes On The Shabby Death Of The Seattle SuperSonics

He was a man accustomed to walking into a boardroom and bending it to his will, and he began his Sonics reign full of unearned bravado. On the flight home from New York after the NBA confirmed his takeover of the team, he sat with Wally Walker, the former player and Goldman Sachs man who, as the team's GM, had just brokered the deal. Schultz turned to Walker and said in all sincerity, "OK, now we need to get Garnett"—as if he could decree such a thing and it would simply be so. At the All-Star Game in 2002, he announced to an assembled group of owners that he'd have a ring when they saw him the following year. This was the uninspiring era of the Gary Payton-Vin Baker-Brent Barry Sonics, remember. Philadelphia 76ers president Pat Croce responded that in a year Schultz wouldn't have a ring and he'd be $20 million poorer.

The team struggled, and Schultz didn't get along so well with its famously mouthy leader, Payton, whom he shipped to Milwaukee in 2003 in exchange for Ray Allen. That drew the ire of many Sonics fans for whom The Glove had become a fixture of the landscape. Schultz would soon have to negotiate the local political economy as well. It was an open secret within the organization that he would eventually need a new, luxury-box-fattened, revenue-rich arena to goose the team's bottom line. But Schultz wanted to bide his time. In his mind, the wins would come, the arena would come, and he would be there, sitting courtside with a big ring on his finger.

In 2004-05, the victories arrived. Ray Allen and Rashard Lewis, led by coach Nate "Mr. Sonic" McMillan, led the team to 52 wins and a surprising division title, reigniting Seattle's passion for basketball. I watched it happen from San Diego, where I was trying to jumpstart a sports-marketing career—with little success. The season after the Sonics' seeming breakthrough, I used my connections to wangle a position with the team. I was low man on the totem pole, working in Guest Relations. I answered the phones and responded to fan email, but I was excited to be on a career path in big-league sports, working for a franchise seemingly on the upswing. Soon after I joined the club, everything there started to unravel.

* * *

A year removed from that improbable division title and playoff run, the Sonics went back in the shitter, but that didn't stop Schultz from launching his quest for an arena in 2006. His timing and tenor left much to be desired. The week of the Super Bowl, he announced in a whiny, entitled interview that the Sonics needed new digs. "It's very clear to us that the city and state officials are not showing us the kind of respect we feel we deserve," Schultz said. "It's ironic with the Seahawks going to the Super Bowl and the community, the state, so galvanized by a sports team, that here we are in a position that's so unfortunate." Angry fans wondered why one team's owner would upstage another local team during the most important week in its history.

Schultz's Super Bowl-week declaration, however, betrayed a civic truth most sports fans fail to acknowledge. If you think your hometown sports teams are all great buddies, you're wrong. The Celtics' biggest rivals aren't the Lakers; they're the Bruins. Paul Pierce and Kobe Bryant may compete for wins, but the Celtics and Bruins compete for money. There are a finite number of rich people in any given city, with a finite amount of money to spend on sports. When a team can make the same amount of money selling two courtside seats as they can selling an entire section of the upper bowl, they'll target their sales strategies accordingly. Getting the affluent to your games means pampering them the minute they walk through the doors. At Safeco and CenturyLink fields, the Mariners and Seahawks do just that; they're gleaming palaces of conspicuous consumption that ensure that fans paying top dollar are given a premium experience with food, drinks, and seatside service delivered efficiently and comfortably. The Sonics couldn't do that. KeyArena had some low-budget exclusive hangouts, but nothing compared to the city's other stadiums. So when Sonics execs saw the Seahawks reaping all the attention and getting fat off a stadium financed in part by public money, they didn't feel happy—they were jealous.

The timing of the Schultz announcement wasn't the only aspect of the arena push being mismanaged. It's one thing for a monarch to declare war; it's another to organize the troops to carry out the battle. The staff was not ready to advocate for the arena. Annoyed Sonics fans wondered why the team should get a new home a little more than a decade after KeyArena was remodeled on the back of $100 million worth of 20-year municipal bonds. I fielded irate calls from fans all day without a single talking point handed down from above. I could offer only platitudes about the Sonics needing a new arena to be competitive in the league. As to why KeyArena wasn't enough, or how taxpayers could be sure the Sonics wouldn't demand a new arena in another 10 years, I didn't have any good answers. Eventually our pleas for guidance traveled up the chain. What happened next only made things worse.

Soon, my phone rang. It was a member of the operations team: "Jeremy, you need to do something for me. You need to grab the championship trophies. Polish them until they're spotless."

Wally Walker, the team's president, gathered the minions in the bowels of the nondescript office park that housed the Sonics' headquarters. Sure, it was coming a few days late, but at least we were finally getting some clarity and marching orders.

Alas, Walker didn't have the good sense to lie to us. He went through a litany of minor reasons why the team needed a new arena: higher capacity, bigger arena footprint, more room for high-end concessions, more places for premium seat holders, a.k.a. the super rich, the people who could afford a pair of courtside season tickets for $70,000. These were the justifications he offered us to explain why we were asking for a heaping pile of taxpayer dollars. After Walker's spiel, a member of the sales staff asked the fateful question: "Wally, what will this arena upgrade do for Joe Sixpack—the regular fan?"

Dead silence.

After an uncomfortable few seconds, Walker said, "Well, nothing." The wind went out of me. It was as if he'd punched me in the stomach. Walker tried to backtrack, but the damage had been done. The battle for hearts and minds had ended before it'd even begun. I didn't see how we'd get an arena deal led by men who couldn't conceive of it as anything but a rich man's boondoggle, perpetrated on behalf of other rich people. Average people would shoulder the costs of making sure that the Puget Sound's affluent—suits at Boeing, executives at Microsoft—could be coddled at a sporting event that average people would no longer be able to afford to attend.

* * *

The arena chatter continued, with testimony in front of the state legislature. In February 2006, David Stern swooped in to give a tepid appeal on behalf of the team. Morale slipped at the office, but people held on to the belief that somehow we'd get a new arena and stay. Maybe it was a way to keep his troops in the right frame of mind, but I remember the head of season ticket sales remaining relentlessly positive about getting the deal done. The NBA season mercifully came to an end and we switched gears to the WNBA, with much of the organization now throwing its efforts behind the Storm's season. On July 18, we prepared for our annual Kids Day at the arena, the highest-attended Storm game each year. By noon that wouldn't be our focus.

I usually arrived at work before most of the staff. On some days, I could wander across the office to get my coffee without seeing anyone. But strangely, that morning, the team's communications guru, was already there. He pulled me aside. "Be prepared to have a terrible day," he said. "I can't tell you any more—you'll know soon enough. But I'm telling you as a friend, this is going to be a really rough day."

I went back to my desk trying to decipher what he meant. Soon, my phone rang. On the other end was a member of the operations team: "Jeremy, you need to do something for me. You need to grab the championship trophies. Polish them until they're spotless and bring them to the Furtado Center [the team's training facility]. I can't tell you why, you just need to do it now."

As I hung up an email arrived from Walker's secretary, telling us there would be an all-staff meeting later in the morning. I pushed away from my computer and rushed to the lobby, where showcases greeted visitors with the 1979 NBA and 2004 WNBA championship trophies. Two sales staffers stood nearby, speculating about the meeting. Still in the grip of our unwarranted optimism, they guessed that this gathering was to announce they'd hammered out an arena deal.

"I think we sold the team," I said. "That's what they're going to tell us." They looked at me like I had shit smeared on my shirt.

We kept a polishing cloth in the trophies' black carrying cases. I shined them up, packed them away, loaded them in the trunk of my car, and sped to the training facility east of the Space Needle. Outside the gates, media had already started lining up for a press conference that they didn't know much about. As I parked, I realized I'd left my team credential at my desk. There was no time to run back and get it. I went to the security guards holding the press at bay and told them I worked for the team and I needed to get in. Without the credential, they didn't believe me.

Exasperated, I went back to my car, grabbed the case and, in front of the media, pulled out the 1979 Larry O'Brien Trophy. This got me through the gates and into the gym, where employees were erecting a stage and inflating balloons as if preparing for a celebration instead the death of Seattle basketball.

The communications guru was right. The day was horrible. I sat on the phone, fielding call after call from angry fans, letting me know how pissed they were and generally taking it out on the underlings. I eventually snapped. When one caller started laying into me about losing the team and how it affected them and how awful we were, I cut him off: "Gimme a break! You may be losing the team, but I'm losing it too! And I may be losing my job on top of it! You'll still have your job!" I slammed the phone down.

* * *

In the wake of the sale, Frank Hughes, the outstanding Sonics beat writer for the Tacoma News Tribune, wrote in a column for ESPN that the optimist he saw in Schultz in 2001 was long gone. The coffee mogul "had become angry, bitter and maddeningly defiant, like a petulant child who decided to take his toy and go home." At the press conference for the sale, Schultz admitted that he had given up fighting for the arena. He said he thought another group would have more luck in brokering a deal for a new arena with city and state officials, which is why he'd sold the team to out-of-town investors for $350 million, $150 million more than his ownership group had paid Acklerley for the franchise.

Howard Schultz Gave Out $3.50 Starbucks Gift Cards: An Insider's Notes On The Shabby Death Of The Seattle SuperSonics

But he didn't want the team shipped out immediately. In a side letter accompanying the deal, Schultz demanded that Bennett and his partners make a good-faith effort for at least a year to get a new arena and keep the team in the Pacific Northwest. At the press conference and for some time after, Bennett maintained that he was committed to doing just that. And he would make a show of immersing himself in the Sonics.

Soon after the sale, Bennett decided he needed a souvenir bounty to take back to his sports-thirsty brethren in OKC. My ears were still ringing with the invective of enraged Sonics fans. Yet I was an impressionable kid in the Guest Relations department and prone to awe, so when an exec asked me to escort Bennett through the Sonics team shop, where the new owner planned to gather souvenirs, I couldn't say no.

Whoever picked me must have smelled the naiveté, because I was dumb enough to be surprised when the press started showing up. "Oh, gosh, how did these TV news cameras get here?" I thought. I shied away from the lenses, thinking they wouldn't want me seen near Bennett, that the press was here to capture Clay. But a PR person, in a clever bit of Nixonian stagecraft, motioned for me to get back into the shot. I was there for the cameras: New Owner Relates to Young Seattleite. He might as well have tousled my hair, too.

Clay and I walked through the shop, making small talk. At the time I was still in my customer-service job, but I'd lobbied for additional responsibilities, which included helping create the team's new magazine, Soniczone. For a multi-part feature, I had extensively researched the history of the Sonics, so that's what Clay and I talked about. I pointed him toward some yellow shirts that I knew were reproductions of the tees some of the players wore during the 1979 championship parade. I told him I had a picture of Sonics great Jack Sikma in his yellow shirt, riding through the streets of Seattle in a convertible. He grinned at this. What was he thinking, I wonder now. Was he picturing a parade through Oklahoma City?

The cameras left, and I wasn't needed anymore. Clay crawled into his car with a lackey, leaving me alone outside the team shop in the drizzle. I watched them pull away without offering me a ride to the office. I walked down the hill and went back to work.

* * *

On the last day of Schultz's reign as owner, we reassembled in the same conference room where Walker had addressed us months earlier. The guru who had made an empire out of overpriced caffeine stood before us. A quiet settled over the room in deference. No one was quite sure what Schultz would say; hell, no one figured he'd even want to speak to the employees he had abandoned. It seemed he had long ago lost interest in the team, in the NBA, in dealing with the players.

At Starbucks, the bulk of Schultz's employees were a commodity on the level of the coffee he sold. His automatons didn't make lattes and cappuccinos in the way of old Italian artisans; they were interchangeable cogs who pressed the buttons of machines on a drink assembly line. But NBA players aren't baristas, and NBA teams aren't cafés.

Schultz had deluded himself with the romantic ideal of the artisan. He preached that his shops were loci of community amid the American sprawl. Go into a Starbucks and you'll know that's not true. In the same way, he believed he could bend the economics and efficiencies of the NBA in his favor. For all the talk about caring, community, and investing in the team, things looked different on the inside. He nickel-and-dimed the club. He slashed bonuses to the sales staff. He made the team carry fewer players, paying to fill 12 roster spots instead of 13. He even raised prices in the office soda machine.

One story of Schultz's cheapness is famous among his former staff. The Sonics' previous owner, Barry Ackerley, had bought holiday gifts each year for the folks in the front office. When Schultz's group took over, the custom died. Rightly or wrongly, some of the employees groused that no gesture had been made to them. According to an employee at the time, another of the team's new owners, Richard Tait, the co-creator of Cranium, heard about the complaints and subsequently gave out copies of his popular board game. Not to be outdone, Schultz followed suit. He gave each employee a Starbucks gift card. One member of the staff—who wasn't a Starbucks regular—decided to use his card to get some snacks. When he went to pay for his roughly five dollars' worth of food, he asked how much money remained on the card.

"Well, you owe me money," the cashier said.

The Sonics employee asked how much had been on the card to begin with.

"$3.50," the barista replied.

At the time, we would later learn, ordinary customers couldn't buy a Starbucks card with a value of less than $5. These were custom $3.50 gift cards.

(It would happen again. It became something of franchise lore that when the Storm won the WNBA title in 2004, the players—the first team to win any sort of championship for Seattle since the 1978-79 Sonics—also got cards that could barely cover a Starbucks coffee.)

This nickel-and-diming of the team permeated Schultz's arena efforts. While the Seahawks and Mariners spent money to lobby the legislature aggressively behind the scenes, Schultz tried to make his push on the cheap, and it cost Seattle the team.

So here he was. The man whom Fortune magazine now calls the sixth-greatest entrepreneur of our time had shown up to tell us something we already knew but never expected to come out of his mouth. With shoulders sagging and with the same querulous tone he used when he complained that city officials had given the Mariners and Seahawks new stadiums but not the Sonics, he told us he was a failure as an owner; he didn't change the NBA's economic system as he had hoped.

The way he said it didn't sit right. Immediately after the speech, a member of the PR staff told me he was glad to have Schultz gone, even though the Okies might move the Sonics out. I felt much the same. The outward humility and self-effacement didn't change the underlying arrogance of the corporate titan. I wasn't the only one rolling my eyes in the speech's aftermath. Schultz spoke as if he wanted us to disagree, as if he wanted us to say, "No, no, Howard," and comfort him and let him know he was being too hard on himself. He wanted absolution for being the guy who sold the Sonics away. We weren't having any of it. He was the woman asking, "Does this outfit make me look fat?" and instead of offering reassurance, I could only think: "You? You look like a fucking whale."

* * *

Bennett and crew floated the idea of leaving Seattle early on in his ownership. No, not for Oklahoma, but for a proposed $500 million palace in a low-rent suburb south of the city. He had sketches made, lobbied the state legislature, and even opened a satellite sales office in Renton to support the pretense that he cared about staying in the area. As part of the agreement with Schultz to buy the team, Bennett had to "make a good-faith effort" for a year to keep the team in the Pacific Northwest.

On the inside, though, you could find subtle clues that the Sonics' days in Seattle were numbered. Chief among them was that when employees quit, as they began to do with greater frequency, there wasn't much effort made to replace them. My colleagues and I grew frustrated with the dissonance between what the new ownership group said publicly and what we saw internally as a series of half-hearted efforts to stay. Further complicating matters were the executives of the team, holdovers from the prior regime, who began angling for favor with their new masters. This occasioned several idiotic and unproductive moves to impress Bennett, such as a ban on casual Fridays. Wearing jeans fostered an unprofessional atmosphere, argued the execs. No, I'm serious, they did that.

Howard Schultz Gave Out $3.50 Starbucks Gift Cards: An Insider's Notes On The Shabby Death Of The Seattle SuperSonics

My response was appropriately petty: I went out and bought a black dress shirt and black slacks and wore them every Friday. And I didn't stop there. I persuaded other people to wear black on Fridays with me. I won over enough people that, one Friday, someone not wearing all black said to me, "There are a lot of people wearing black." To which I responded, "We're mourning the death of morale."

While fans weren't privy to the internal tumult, they could sense Clay inching out the door all the same. They stopped coming to the arena as Sonics attendance sagged to 27th in the league. And that's even with us actively trying to fill up the Key with deeply discounted tickets. On more than one occasion, I had friends turn down free great seats because they had something better to do. That didn't mean we didn't try to boost attendance any way we could. If I entered the building using my credential, I would make sure to go to an usher to get a ticket scanned anyway, to pad the numbers. I wasn't the only one doing this.

I felt beaten down. Whatever faith I'd had in the club's leadership was gone. They ran the team almost as if they wanted us to quit, a guy mistreating his girlfriend in the hopes that she'll break up with him so he doesn't have to go through the messy business of doing it himself. An apparent hiring freeze precluded upward mobility, and the future of the team magazine I worked on seemed tenuous at best. The malaise extended across the staff. Employees talked openly in the halls about successful job interviews they'd had the day before. I began to look toward the exit myself and landed a new job at Microsoft. I wasn't going down with the ship.

Leaving the Sonics was difficult. It remains my favorite place I've ever worked, not because of the pay (it was meager at best), not because of the day-to-day tasks (I was a glorified call-center worker for most of my tenure), and certainly not for the leadership there, but because my fellow peons were some of the best people I've ever met. In truth, many of them were overqualified for their jobs, and they've since gone on to greater things. I've remained friends with many of them to this day. On my last day, my boss, Pete, whom I'd known since I was 20, called me over to his office. When I arrived, there was a bunch of the staff, a cake, and a present waiting for me.

* * *

I could have gone to that last game, the one where fans chanted to "Save Our Sonics." That came a year after I'd left. Friends with the team offered me tickets, but I declined because I believed it would only be the last game of the season, not the last of the Seattle SuperSonics. Like the Mariners and Seahawks, which had threatened to leave before, the Sonics would find a way to stay.

And then they were gone. I still have friends, much bigger basketball fans than I am, who have totally abandoned the NBA. In that first season with no basketball in Seattle, I simply couldn't bring myself to watch the league, though I did delight in catching stories about the Thunder's ineptitude in OKC. I've slowly come back to the NBA as a basketball nomad in search of a team, and for the most part I've tried to ignore the Thunder. But now that they're on the verge of joining the league's elite, some old resentments have been rekindled. This should be our team, my heart tells me, not Clay's, not Oklahoma City's.

I wish I could really believe that. But the Thunder, the runaway Northwest Division champions, are not the Sonics. Had Howard Schultz not sold this team to Clay Bennett, the Thunder as we know them—the title contender Seattle fans so desperately wish they'd had—wouldn't exist. Under Howard Schultz and Wally Walker, the Sonics were a team and organization that aspired to adequacy. Maybe they would be good, but they would never be great. Fans could see it on the court and during the draft (Robert Swift and Mouhamed Sene?!); employees could see it in the shabby, penny-pinching way the front office was run.

In Seattle, we wanted to denigrate the Okies so much that we couldn't even keep our prejudices straight. We heard Bennett and Co.'s accents and saw their regressive politics, and we labeled them rubes and idiots. At the same time, we painted them as sinister geniuses who'd cynically orchestrated the theft of our team, with David Stern as their co-conspirator. Resentful Seattleites are like those 9/11 Truthers who simultaneously believe that the government is both totally inept and guilty of perpetrating and covering up an immense terror plot. You can't have it both ways. Either Bennett is an idiot who married into his fortune and lucked into the team, or he's a canny businessman who played the game shrewdly and won.

I have to think he's the latter. I need only look at the organization he's put together to know he's running the club better than Schultz—the media-ordained genius—ever did. It was Bennett who brought in the architect of the club, Sam Presti, based on their mutual connections with the San Antonio Spurs. It was Bennett who allowed Presti to build slowly around Durant instead of demanding wins immediately. Sure, there was plenty of bad faith on Bennett's part during the sale, but at this point it's silly to expect anything else from a sports owner. Caveat emptor applies to us as much as it does to owners. They are running revenue-maximizing operations, and a fanbase is of use to them only to the extent that it makes them money. All we can hope for is that an owner cares enough about his product to give us something worth watching every year. By all evidence Clay Bennett cares about his product. Howard Schultz never did. Maybe that's the ultimate deception in the Sonics' story: A lot of us had the wrong villain all along.

* * *

I've always remembered something Brent Barry told me. It was in a Q&A, conducted in the wake of the trade that sent Gary Payton and Desmond Mason to Milwaukee. I'd asked Barry how Mason was doing. "He's taking it hard, but this is the first time he's been traded," he told me. "Listen, the first time I was traded, I felt it right here." Barry put his finger on his heart. "The next time, I felt it right here." He pointed to the sole of his shoe. "This is a business."

Jeremy Repanich is a Brooklyn-based writer. His work has appeared in Popular Mechanics and Men's Journal, and on Wired.com and The Classical. You can follow him on Twitter @racefortheprize. Top image by Jim Cooke; source photos via Shutterstock and Getty. Other photos via AP.