Author Topic: NHL rejects Kovalchuk's 17yr/$102mil deal  (Read 5340 times)

Offline VOLTAN

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NHL rejects Kovalchuk's 17yr/$102mil deal
« on: July 21, 2010, 03:15:04 PM »
Before the NHL can use the next collective bargaining agreement negotiation in 2012 to close the "lifetime contract" loophole, the following players will have agreed to new contracts with one team or another:

Steven Stamkos(notes), Joe Thornton(notes), Zdeno Chara(notes), Shea Weber(notes), Zach Parise(notes), Drew Doughty(notes), Brad Richards(notes), Andrei Markov(notes), Simon Gagne(notes), Jeff Carter(notes), Patrice Bergeron(notes), and Alexander Semin(notes). That's just to name a few.

So if Ilya Kovalchuk(notes) was allowed to sign a 17-year contract with a $6 million cap hit, what prevents Parise from going for 18? Or Doughty for 20?

Everyone has a theory about why the New Jersey Devils' $102 million, 17-year deal was ruled invalid by the NHL when other cap-circumventing contracts were allowed.

Here's mine: It was a political broadside against NHL general managers and the NHLPA by the league, using an absurd but ultimately legal contract (within the rules set forth by the CBA, and the NHL's own previous decisions) to say enough's enough; that the NHL has set its limits for winking acceptance of cap circumvention Marian Hossa(notes) making $1 million at 42 years old, or Roberto Luongo(notes) making $1 million at a just-as-ridiculous-as-Kovalchuk 43 years old and they're going to spike contracts if they go beyond those levels.

And now it's up to the Devils, the player, the agent and the NHLPA to figure out how to respond.

There's been a lot of debate about Kovalchuk's deal vs. those for Hossa or Chris Pronger(notes) or any player whose cap hit suddenly drops to minimum wage in his twilight years; how it's more feasible that Hossa will play at 42 than Kovalchuk will play at 44. But feasibility isn't fact; fact is that Ilya Kovalchuk said in his now-satirical press conference that he intends to play until he's 44.

We can assume that's B.S., but from a legal standpoint there would need to have been something tangible that stated the contract was structured with the intent of Kovalchuk retiring. Frankly, the Devils and Kovalchuk agreeing to have a no-trade clause to the end of the deal is more compelling evidence that he "intends" to play out the term than the NHL simply saying "we don't believe you."

Reader Andrew P. got philosophical on this aspect of the debate in an email Tuesday night:

    The issue of salary cap circumvention is a real life example of the paradox known as Kavka's Toxin Puzzle. The question posed is: Can you intend to do something, in order to receive a payout, while knowing that you are under no obligation to actually do it?

    Logically, the likelihood of Kovalchuk genuinely intending to play through the end of his contract is minimal, considering how few players have actually played to that age and he will be earning the minimum salary. But to intend requires no tangible commitment and intention is impossible to prove or disprove on a purely logical basis, as long as the intention is theoretically possible.

Thanks, Morpheus.

So here's how the thing plays out: The Devils have five days to submit a restructured contract to the NHL for approval or rejection. It's expected the team and the league would work together to find a workable solution. If they don't re-file, and the NHLPA doesn't file a grievance, then Kovalchuk's a free agent.

Or, the NHLPA files a grievance over the rejection, submitted to the NHL by the fifth day. If the PA does this, then the case goes to an arbitrator. If he or she rules for the NHLPA, the contract is valid; if the NHL wins, Kovalchuk goes UFA or the player contract is reformed by the arbitrator "such that it conforms to the requirements of this Agreement, in a manner such that the term of the SPC shall not be modified and the aggregate compensation to be paid to the Player pursuant to the SPC shall, to the extent possible, be preserved," according to Section 11.4 of the CBA.

(Ed Note: We got our subsections scrambled up, according to Jewels From The Crown. Reader Jeff G. offers more clarity:

11.6(a)(i)(C) If an SPC or Offer Sheet is rejected because it is or involves a Circumvention....

11.6(a)(i)(y) ....and the NHLPA files in time, the case will be heard and decided by the Arbitrator within 48 hours...

11.6(a)(iii) ....and the Arbitrator sustains the NHL's rejection, the contract is null and void.)

According to a source with knowledge of these cases, the NHL doesn't currently have a "systems arbitrator" in place. Both sides would submit candidates and settle on one to hear the case, but I'm still waiting on NHLPA confirmation about this facet.

In calling around Tuesday night, I got the sense that the NHLPA (and Donald Fehr) would welcome this chance to take on the league. The NHL's previous approvals of contracts that clearly circumvented the cap, and the presumed lack of evidence that the Devils and Kovalchuk conspired on a retirement age (unless one side or the other was immensely dumb and put it in writing) would make their case a difficult one to win.

That is, if the NHLPA finds these contracts worth fighting for when they do harm the rank-and-file.

Rich Chere of the Star Ledger wonders if Devils GM Lou Lamoriello's words from Tuesday, in which he basically called the Kovalchuk deal an eye-rolling farce, will haunt the team in an arbitration case. Others have wondered if Lamoriello was the cause for the rejection of the deal.

A source who has worked with the league on contracts told us Tuesday night that the Devils were aware the contract could be rejected by the NHL but went ahead with their press event anyway. Note that Darren Dreger of TSN, a plugged-in guy, warned that the NHL still needed to approve the deal on Monday.

The Devils either felt the league would rubber stamp a 17-year contract, or would announce its rejection of the deal before the press event. Because now Tuesday's fanfare at the Prudential Center might as well have had a "Mission: Accomplished" banner behind the dais.

As for Lou's comments, the more I think about them, the more I think he knew the contract would be spiked. Why else toss his owners under the bus as the driving forces behind the deal? From the Star Ledger:

    This is also a contract Lamoriello probably would not have done on his own. He surely would've offered less money for fewer years, informing the player and agent that it is a privilege to play for the Devils. But owners Jeff Vanderbeek and Mike Gilfillan have had enough of waiting for another Stanley Cup, struggling to fill the Prudential Center and being an afterthought in the metropolitan hockey market. So they told Lamoriello to spend the money and gave him a little push to do so.

Again: Hard to imagine Lou didn't know, and hard to imagine that he agreed with the deal if he went public like this.

Perhaps now that 17 for No. 17 was rejected, the contract becomes something both Lamoriello and the NHL can feel better about. Unless, of course, the NHLPA is strapping on its bullets and looking for its camouflage.

Offline miDnIghtEr20C

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Re: NHL rejects Kovalchuk's 17yr/$102mil deal
« Reply #1 on: July 21, 2010, 03:40:43 PM »
that is freaking crazy!   i heard someone talking at work about this... just didn't know it was denied!