I've brought that up before and was shot down by the conspiracy theorists who refuse to believe Lou doesn't have a trick up his sleeve. I'm not even sure he could have appealed in the first place. After all it was the NHLPA who negotiated the terms of the penalty in the first place (they fought against the fine being a cap penalty iirc).
Well like I noted above I don't believe forfeiting a pick and paying a fine is admission of guilt by any means (not in the legal world at least). This is what very likely happened (from reviewing the CBAs, reviewing the articles, and my memory):
The NHLPA and the NHL were in the process of negotiating a new CBA. They moved to eradicate contracts similar to Kovy's. In the interest of protecting Kovy's interest, the NHLPA filed a grievance. That's how the issue presented itself to Bloch (again clubs can't file grievances). At that time, the NHLPA realized how poorly this looked and how negatively it affected labor peace and moved to resolve this matter with the NHL without extensive proceedings (fighting for a contract everyone wants eradicated in the future is silly). So the Devils penalty was upheld.
An unhappy Lou delayed this process as long as he possibly could. Forfeited a pick. Paid the fine. Delayed giving up the first until the last possible moment. He could, at this point, with 10 years of labor peace negotiated, push to eradicate the penalty.
If he wins and the league rules that the penalties are too severe, the NHL would reimburse the Devils the fine and the pick (or just say they don't have to give up the first).
Here's the deal though - Lou needs either the NHL or the NHLPA to file a grievance for him. I'm sure there's a process to do this that I don't know about in the Constitution but I haven't gotten to that yet. Or, Lou could file a lawsuit and force a real people judge to say "look, go find a mediator and figure this out under your CBA."
Either way is a win-win for the Devils.