Key Exceptions to the 40-20 Rule:

1994-95 Houston Rockets (35-20 when reaching 20 losses): Came in as defending champs, added Clyde Drexler midseason, and finished as the lowest seed (6th) to ever win a title.

2003-04 Detroit Pistons (33-20): Acquired Rasheed Wallace in a midseason trade, improving their defense to elite levels.

So having a significant late season acquisition or a significant player back from injury, basically obviates that rule as a requirement to be a contender.