Donaghy pleads guilty to two felony charges in betting probe

In one exchange, according to court papers, Donaghy provided a tip about an NBA game on Dec. 13, 2006. That same day, he worked a 76ers game in Philadelphia against the Boston Celtics.

The next day, Donaghy met with the gamblers in Pennsylvania and received a cash payment, authorities say. A person close to the investigation, speaking on condition of anonymity because the case is ongoing, said the payment was for a successful tip on the 76ers-Celtics game.

The point spread moved two points before the game went off the board -- a fairly significant swing -- with Boston going from a 1½-point favorite to a 3½-point choice. Boston won by 20.

The two alleged co-conspirators, identified by prosecutors as James Battista, a professional gambler with the nicknames "Baba" and "Sheep," and Thomas Martino, also appeared in court Wednesday. They were ordered released on $250,000 bond after their arraignment on charges of conspiracy to defraud the NBA.

Battista's lawyer, Jack McMahon, said a grand jury is expected to hear the case and, if indicted, his client intends to plead innocent.

"Mr. Donaghy walked away with a nice situation for himself. He is the linchpin and he seems to have worked his way into a nice situation," McMahon said. "I don't know if that is fair."

The betting scheme was uncovered during an investigation into the Gambino crime family in Brooklyn. None of the defendants in this case was charged with organized crime affiliation.

"He has no more association with an organized crime family than me, and I'm not associated with any organized crime," said McMahon, Battista's lawyer.

Stern said last month that the FBI first contacted the NBA on June 20 to talk about a referee alleged to be gambling on games, and Donaghy resigned July 9 after 13 years as an official. Stern said he would have fired him sooner but was told it might affect the investigation.

Stern blamed a "rogue, isolated criminal" for a scandal that threatened the credibility of every referee. But players are trying not to get too caught up in it.

"Honestly, I don't think anybody's thinking about it. Us players, we haven't discussed it," superstar Kobe Bryant said. "It's not something that's on the radar for us. We know that the commissioner and the league and whoever else is handling the situation, they're going to take care of it, so we don't have much to worry about."

Donaghy, who earned $260,000 last year, was rated in the top tier of officials, and there was nothing suspicious about the frequency of his foul calls, Stern said. He was assigned to work in the second round of the playoffs, with his last NBA game coming during the Phoenix-San Antonio Western Conference semifinal.

The NBA places huge restrictions on NBA referees when it comes to gambling. They are not allowed to enter a casino, for example.

"An unfortunate situation has taken place," New Jersey Nets guard Jason Kidd said. "But I think the NBA will definitely learn from this but move forward. Win or lose, the players control that."

Donaghy turned over his passport and must seek permission to travel anywhere other than Pennsylvania, Florida or New York.

In court, Donaghy said he is receiving psychiatric treatment for his gambling problem and is taking antidepressant and anxiety medication.