Devils 1st round draft pick forfeiture

[njdevil26]

njdevils26, why are you bringing up those contracts after Kovalchuk? After the Kovalchuk fiasco, they made the "Kovalchuk rule," which allowed that drop-off.

It's just a grand spectrum. Luongo, Pronger, and Hossa were before Kovalchuk. Parise, Suter, and Weber are a big deal because it's not the drop off that is the biggest problem... the signing bonuses are the circumvention pieces.

 

[Fugu]

Devils fans agree the contract was ridiculous. The problem we have is that many teams have gotten away with their own form of circumvention beforehand and the league decided to come down on the Devils... and no other team since. Something that everyone needs to remember is that the Devils did not violate any written rules. Bettman and Daly maintained that the Devils violated the "spirit" of the salary cap.

Since then, the contracts of Brad Richards, Zach Parise, and Ryan Suter could be considered as a "spirit" violation as well.

<snip>

I generally agree with this sentiment. It seems the NHL took exception to the degree of the circumvention, that it was obviously the most blatant in all aspects of how you could accomplish the circumvention, and thus possibly the easiest to convict. Technically, everyone found the loophole but the NHL did leave itself the out that they could not predict every circumstance that they could review a contract even after it was registered. The fact that an independent arbitrator made the ruling also supports the conclusion about intent.

It may also be possible that in investigating this contract, they were able to find evidence that wasn't made public?

Keep in mind as well that the PA was involved and part of the agreement was to drop the investigation of several earlier contracts. There must have been something much more compelling in the NJD case.

 

[Captain Mittens*]

So did many other teams. That's what everyone is forgetting here.

The Devils pushed the limits AFTER the NHL warned the teams that these contracts weren't going to be allowed any more. They pretty much gave Bettman the finger with that contract.

That is why there was a penalty and why it was severe.

 

[Crede777]

Does this whole debate ignore the fact that the NHL made a decision and (right or wrong) they should stick to it?

 

[Fugu]

The Devils pushed the limits AFTER the NHL warned the teams that these contracts weren't going to be allowed any more. They pretty much gave Bettman the finger with that contract.

That is why there was a penalty and why it was severe.

That shouldn't be a factor. Either all the contracts were circumvention (intent) or none of them were since they all used the same method for circumvention. I'm still leaning in the direction that the league had a proverbial smoking gun in this case, as intent may be difficult to prove indeed. Furthermore, to buy the PA's cooperation to rewrite portions of an existing CBA (they can't do that unilaterally), they may have dropped the other cases for those reasons.

Does this whole debate ignore the fact that the NHL made a decision and (right or wrong) they should stick to it?

I think so-- on both counts.

 

[njdevil26]

I generally agree with this sentiment. It seems the NHL took exception to the degree of the circumvention, that it was obviously the most blatant in all aspects of how you could accomplish the circumvention, and thus possibly the easiest to convict. Technically, everyone found the loophole but the NHL did leave itself the out that they could not predict every circumstance that they could review a contract even after it was registered. The fact that an independent arbitrator made the ruling also supports the conclusion about intent.

It may also be possible that in investigating this contract, they were able to find evidence that wasn't made public?

Keep in mind as well that the PA was involved and part of the agreement was to drop the investigation of several earlier contracts. There must have been something much more compelling in the NJD case.

Well I think the NHL threw the PA off the hunt when they offered the Kovalchuk rule that allowed back-diving contracts. It meant more members of the PA could get a ton more money up front.

 

[Fugu]

Well I think the NHL threw the PA off the hunt when they offered the Kovalchuk rule that allowed back-diving contracts. It meant more members of the PA could get a ton more money up front.

That plus agreeing to drop the other cases. Like I said above, the league couldn't make an unilateral change to the CBA. They had to work with the NHLPA to write up the addendum.

 

[Finlandia WOAT]

It's just a grand spectrum. Luongo, Pronger, and Hossa were before Kovalchuk. Parise, Suter, and Weber are a big deal because it's not the drop off that is the biggest problem... the signing bonuses are the circumvention pieces.

The rejected Kovalchuk contract had the same number of 'dead years' (less than half of the cap hit) than both the Parise and Suter contracts combined.

It was so ridiculous that the League felt confident that it could win in arbitration. Which it did.

Anyways, after the Kovalchuk contract, the League amended the CBA: the "Kovachuk" rule. The idea was to put a limit on the long term contracts.

In exchange for allowing this amendment to pass, the League agreed to grandfather in the Hossa, Luongo, Zetterberg, etc. contracts. They couldn't change anything at the time because the PA wouldn't allow it (and why would they? It was a great loophole).

 

[Captain Mittens*]

That shouldn't be a factor. Either all the contracts were circumvention (intent) or none of them were since they all used the same method for circumvention. I'm still leaning in the direction that the league had a proverbial smoking gun in this case, as intent may be difficult to prove indeed. Furthermore, to buy the PA's cooperation to rewrite portions of an existing CBA (they can't do that unilaterally), they may have dropped the other cases for those reasons.

It absolutely should be a factor. Same as parenting. If I had kids and they kept doing something wrong, say vandalizing the neighbors house and immediately after I told them not too the kid(s) went and did it again?
You throw the book at them

More than a year ago, the league warned GMs that it was unhappy with the number of long-term deals whose cap hit was made more manageable by heavily front-loading the contract and tacking on years at the end. These deals worked for players because they made most of the money early in the contract; the deals worked for GMs who were looking to keep the average cap hit as low as possible, giving them more financial flexibility....

Presumably, the NHL found no evidence of an agent or player giving a team the old "wink, wink, nudge, nudge" about not playing after a certain point in the contract since the team wouldn't be on the hook for the rest of the deal (provided the player wasn't 35 when the contract took effect, as was the case with the contract extension Pronger signed with Philadelphia).

Clearly, though, the league believed its warning to cease and desist these kinds of deals was falling on deaf ears; and when it saw the whopper deal Kovalchuk, his agent Jay Grossman, and New Jersey president and GM Lou Lamoriello came up with, the league said "enough."

http://sports.espn.go.com/nhl/columns/story?columnist=burnside_scott&id=5397260

 

[Doan Jidion*]

Well maybe Lou shouldn't have bet the farm on a single horse.

Yeah. Grabbing the brass ring is indeed an uphill battle.

 

[Saskatoon]

I still can't believe they didn't give up the pick the year they made the finals

 

[Butch 19]

I hope to god the NHL rejects any requests outright. Sucks that NJ lost Kovy, and I feel for the fans...but the stupidity/arrogance of Lou not giving that pick up the year they lost in the Cup Finals deserves the karma police stepping in and making an example of the Devils.

If they some how get out of the punishment.....

If NJ has the nerve to ask to reverse the lost pick, I would hope the NHL would say: "Really? Now you lost a 2nd round pick next year. Wanna keep going for a 3rd rounder in the next year?"

the key words here are... the stupidity/arrogance of Lou

 

[kdb209]

It's just a grand spectrum. Luongo, Pronger, and Hossa were before Kovalchuk. Parise, Suter, and Weber are a big deal because it's not the drop off that is the biggest problem... the signing bonuses are the circumvention pieces.

And how are Signing Bonuses "circumvention pieces"?

Signing bonuses are treated just like salary when w.r.t. cap hits and the max salary restrictions.

Signing bonuses may have side effects -
- they provided effective "Lockout Insurance" for some players.
- they may provide a UFA/Offer Sheet benefit to big market teams who can more afford to pay more $$$ upfront.
- they shaft other players, since no escrow is withheld from signing bonuses paid before the start of the season.

but cap circumvention is not one of them.

 

[ScottyK]

The Devils pushed the limits AFTER the NHL warned the teams that these contracts weren't going to be allowed any more. They pretty much gave Bettman the finger with that contract.

That is why there was a penalty and why it was severe.

They could give the finger all they want honestly the contract didn't break any rules other than the "spirit" of the CBA.

I wish Lou would of taken this to a court there is no way it would of been upheld.

 

[ScottyK]

Has Lou ever publically commented on why he decided to keep the 29th pick? If their pick ends up top 3/5, where does this rank in all-time executive blunders?

http://www.nj.com/devils/index.ssf/2012/06/devils_will_keep_this_years_fi.html

"We will pick. We made the decision to pick," Lamoriello said. "We made (the decision) a while ago."

He said that despite his comments suggesting he was undecided about whether the team would keep the pick this June, he knew all along the Devils would not give it up despite the fact that they will be picking 29th.

"We could've finished 30th," he said.

http://www.nhl.com/ice/news.htm?id=634677

Lamoriello said the Devils had made the decision to keep the pick "a while ago."

"We made the decision that we were going to keep it, but used the time on our side to make sure we were going to keep it," he said. "So when I said we didn't know, we just hadn't confirmed it, but we had made this decision."

He said they would have kept the pick even if they had won the Stanley Cup.

I think in Lou's head he feels they had players targeted at 29 they thought could really help ( IDK if that ended up being Matteau or not ) Also thinking the team would be competitive the next 2 yrs. ( he really did think Zach was staying and noone could of predicted the Kovy move ) So he kept the pick with the mindset that he was targeting a player he really liked and couldn't gurantee such a player would be there in 2014.

 

[Fugu]

I still can't believe they didn't give up the pick the year they made the finals

Thinking about this a bit more, Lou may have known that both Kovy and JVB were on their way out. There was mention that, although I forget the exact dates, that Kovalchuk and Lou had talked about the possibility of his return to Russia at least a year before he actually made the decision.

If Lamoriello believed there was any chances at getting the penalty reduced, of course he'd defer the pick to this season.

 

[kdb209]

I wish Lou would of taken this to a court there is no way it would of been upheld.

If they had taken it to court, it would have quickly been dismissed on jurisdictional grounds - that arbitration under the terms of the CBA is the proper venue for any dispute arising under the CBA.

 

[Roomtemperature]

If NJ has the nerve to ask to reverse the lost pick, I would hope the NHL would say: "Really? Now you lost a 2nd round pick next year. Wanna keep going for a 3rd rounder in the next year?"

the key words here are... the stupidity/arrogance of Lou

Yeah I hope you do that as a parent because unnecessary escalation really endears you to people and doesn't make them feel hopeless to the point where they give up and stop trying.

 

[Butch 19]

Yeah I hope you do that as a parent because unnecessary escalation really endears you to people and doesn't make them feel hopeless to the point where they give up and stop trying.

LL submitted the front loaded contract after he was told not to. Sorry, but how is that NOT arrogant?

He just didn't think the NHL would call his bluff. Well, they did.

 

[Holtz My Bahls]

I have a strong feeling this is not over.

 

[IME]

For those complaining about the Parise/Suter/Hossa/etc contracts, remember that the new CBA does punish those teams.

The Cap Advantage Recapture Rule—a.k.a. the Luongo Rule—effectively makes a team pay for any advantage they experienced from these front-loaded long term contracts.

 

[Alklha]

They could give the finger all they want honestly the contract didn't break any rules other than the "spirit" of the CBA.

I wish Lou would of taken this to a court there is no way it would of been upheld.

The court wouldn't have any authority on the matter. The Devils have an agreed process with the NHL that they must abide by.

The idea that just because something isn't expressly written in the CBA then it is okay is just crazy. That is basically arguing that teams should have been able to tack on 20 years at League minimum at the end of these career contracts to bring that cap hit all the way down.

Suggestions that the League should have just rejected the contract without punishment is equally crazy. They would have been rejecting the contract for attempted cap circumvention, they must be punished for attempting to break the rules.

There is only 1 other contract that comes remotely close to the Kovalchuk contract and that is the Marián Hossa contract. That deal was 5 years shorter, the player would be 2 years younger at the end of it and the last 4 years of that contract account for 6% of the contracts value compared to the last 6 years of the Kovalchuk contract accounting for 3%. I'd say the Hossa deal was circumvention too, but that is clearly where they decided to draw the line in the sand. The Kovalchuk deal was very obviously significantly more blatant and all teams knew of the potential of punishment.

 

[Fourier]

Thinking about this a bit more, Lou may have known that both Kovy and JVB were on their way out. There was mention that, although I forget the exact dates, that Kovalchuk and Lou had talked about the possibility of his return to Russia at least a year before he actually made the decision.

If Lamoriello believed there was any chances at getting the penalty reduced, of course he'd defer the pick to this season.

It still makes little sense to me that they would be given a break because the team and Kovalchuk decided to mutually terminate this deal. Clearly the Devils were ok with this. Their gain from this decision was a lot of money they did not have to pay out. Given the financial state of the franchise at the time I don`t see losing Kovalchuk as a massive negative.

 

[Betamax*]

For those complaining about the Parise/Suter/Hossa/etc contracts, remember that the new CBA does punish those teams.

The Cap Advantage Recapture Rule—a.k.a. the Luongo Rule—effectively makes a team pay for any advantage they experienced from these front-loaded long term contracts.

Yeah ... but time will reveal how effective or ineffective the "Luongo Rule" really is.

I mean, teams that feel hampered by the "cap recapture" rule could find various methods to try to mitigate its affect. i.e. find a way to put said player on LTIR.

Trade him to a team with plenty of cap space at the time and an open roster spot.

By the time the "cap recapture" rule become relevant for the players you cite, the landscape may have changed again -- with the CBA being up for re-negotiation and they might have a grace period for "cap compliance" like they did with this current CBA.

 

[IME]

If the 29th pick turned out to a be a decent player, the Devils could theoretically flip him for a 1st and another pick, effectively lessening the penalty from a loss to a shift down.