An alleged $40,000 payment to former basketball star Dennis Smith Jr. is at the center of the NCAA's case against N.C. State.
In its 66-page response to the Notice of Allegations the NCAA sent in July, N.C. State questioned the evidence of the payment by T.J. Gassnola, a former Adidas associate, and the veracity of Gassnola's testimony during a federal fraud trial in New York in 2018.
N.C. State submitted its response, prepared by the Bond, Schoeneck & King law firm, to the NCAA on Monday. The NCAA has 60 days to respond. Scheduling a hearing with NCAA's Committee on Infractions will be the subsequent step. That could happen as soon as March.
"When this process started, we promised accountability where appropriate and vigorous defense where necessary, and our response does exactly that," Chancellor Randy Woodson said in a statement released by the school on Monday. "We look forward to a thorough and accurate review by the panel of the committee on infractions and a fair resolution of this case for the university and the NCAA."
As a part of N.C. State's response, it has suggested self-imposed sanctions of:
- The loss of one scholarship for the 2021-22 recruiting class (or if one comes open before then).
- The reduction in the number of official recruiting visits during the 2019-20 academic year.
- The prohibition of unofficial visits during a two-week period during the 2019-20 academic year.
- A $5,000 fine.
The NCAA will rule after the hearing. A postseason ban, scholarship reductions, vacating the 15 wins from the 2016-17 season and a fine are all possible punishments. The most severe violations in the NOA are tied to former head coach Mark Gottfried and former assistant coach Orlando Early, while the lesser violations concerning ticket distribution, are tied specifically to the school.
Of the four violations - all connected to Smith's recruitment and tenure from 2015 to '17 - outlined by the NCAA in the NOA, the alleged $40,000 payment is the most serious. As a categorized "Level I" violation, it would carry the most severe punishment.
Smith, who was a first-round NBA draft pick after his lone season for the Wolfpack in 2016-17, has since denied that he was paid during his recruitment. In an interview with N.C. State's compliance office in April 2019, Smith said he did not know who Gassnola was and that "he nor his family ever received any cash from anyone at N.C. State."
N.C. State is disputing the facts surrounding the payment and the motivation of the payment and has rebutted the NCAA's assertion that it should qualify as a Level I violation.
Gassnola, a grassroots coach for Adidas, testified during the federal trial of former Adidas executive Jim Gatto in Oct. 2018 that he provided $40,000 to Early in Oct. 2015.
The NCAA's primary evidence in the case is Gassnola's testimony. During the trial, Gassnola provided receipts from a trip to Raleigh to deliver the $40,000 to Early and a bank statement that showed he withdrew the matching cash amount.
Gassnola testified that he gave the money to Early, who was supposed to deliver it to Shawn Farmer, a former trainer for Smith. In turn, Farmer was supposed to deliver the money to Smith's father, Dennis Smith Sr.
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But in its response, N.C. State argued:
"There is no evidence in the trial record, including Gassnola's testimony, nor evidence developed by the NCAA enforcement staff, that: Early provided the money to Farmer or that Farmer provided the money to the Smith family."
N.C. State also wrote the veracity of Gassnola's testimony must be "stringently evaluated" and cannot be accepted without independent corroboration."
The school characterized Gassnola, who pleaded guilty to conspiracy to commit wire fraud in connection to the Gatto case, as "not a credible witness" and one with a "long history of dishonest and criminal conduct."
In addition to the issues connected to the evidence and Gassnola's testimony, N.C. State has highlighted the source of money for the payment and also the motivation for the payment.
Gassnola testified that he received the $40,000 from Martin Fox, a middle man for agents and financial advisors. Fox has been connected to agent Andy Miller but is not an associate or employee of Adidas.
Hence, N.C. State argues that Adidas didn't pay Smith as an inducement to go N.C. State (which has a multi-million contract with the sneaker company), rather that Fox was trying to help Smith so that once Smith went pro, he would potentially sign as a client for Miller.
Under NCAA rules, there's a difference between being paid as a "recruiting inducement" by a booster or affiliate of the school (in this case, Adidas) and an "impermissible benefit" from a third-party not related to the school.
"N.C. State strenuously disputes and is contesting the NCAA's most serious Level I allegation based on a lack of evidence of a recruiting violation, combined with the improper use of information from a criminal trial," Fred Demarest, a senior associate athletic director, said in a statement released by the school. "As a result, we assert that this infractions case should be viewed as, at most, a potential Level II case."
In 2012, N.C. State sent a disassociation letter to Miller for his ties to a former AAU coach in Georgia.
There were two lesser "Level II" violations connected to Smith and his family receiving an excess of complimentary N.C. State basketball tickets and the failure to monitor the ticket distribution process.
The school wrote the former basketball staff ignored rules and "well-established processes" with the ticket distribution protocol.
The athletic administration has since "implemented corrective actions to ensure the same or similar conduct will not occur now or in the future."
Among the ticket problems, which the NCAA totaled as $2,119 in impermissible benefits specifically for Farmer and $4,562 to Smith's family, was how the tickets were assigned.
There are separate lists for players and coaches and Early's list went over certain NCAA limits. If some of the names had been put on Smith's list, it would not have constituted an NCAA issue.
The school wrote in its response that of the 160 ticket-related issues, only 10 could not otherwise have been permissibly provided."
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