I think Iggy was asked to sit on the bench and mentor the young. Granted He was trade fodder. Its very common to negotiate some form of buy out so the veteran player can find a place to play.
Memphis felt he had trade value and was not going to release him for nothing in return. Memphis is within its right to do this. That they never forced him to report either.
Both parties I think were not great about this. IN the end Memphis got value in return. Iggy got to rest his bones. Memphis was smart to use Iggy (throw him under the bus) as a way to bring the team together.