P. Daddy: Lamoriello tries (the neighborhood of) 15 years; League says, uh...no.

Kovalchuk, Devils propose to Bettman, get jilted again - Puck Daddy - NHL  - Yahoo! Sports
[...] According to a source with knowledge of the negotiation, the term of the contract was in the neighborhood of 15 years, and it was the term that appeared to be the point of contention between the sides.  [...] One more note on the NHL and those contract investigations: Daly told XM Home Ice's Hockey This Morning yesterday (listen here) that if the [other] deals are found to have circumvented the salary cap, the penalty may not necessarily be a de-registration of the contract; rather, the CBA allows for financial penalties and having teams lose draft picks as punishment. Keep that in mind for the Hossa deal, especially.

I'm going to assume the 15 year thing is true because (1) it's Puck Daddy, and (2) it makes total sense. Thirteen years would have been no problem for the league (essentially following the Detroit model). New Jersey knows they have to have a tail with salary at $1MM or above. The only question is term, and if we're to believe they're asking about something the league is balking at, it just stands to reason it's because Lamoriello wants 14 or 15 years.

[MORE]

 

As I argued last week, it's entirely possible that Lamoriello and Kovalchuk will be too far apart if the league won't go above a 13 year term. $6.5MM cap hit times 15 years is $97.5MM, a nominal compromise for Kovalchuk. At 13 years, that's $84.5MM, which would be a prohibitive discount (insert joke about how Kovalchuk wants to play for a contender and it's not about the money). 

Now, about the second part of the Puck Daddy post, the part where Daly reiterates this weird point about de-registration not necessarily being the penalty that will be applied if the other deals are found to be in circumvention. I tried to make sense of this last week, when Daly first made these comments. I said at the time it made no sense, since an arbitration on those contracts would lead to a yes/no decision that would absolutely de-register the contract if the arbitrator found in favor of the league. My bottom line was, the CBA does not allow for a contract to be in circumvention and yet be allowed to stand.I concluded that Daly was essentially being misinterpreted, that what he was saying was that de-registration is not the only penalty.

But I'm wondering if he isn't actually doing some Clintonian super-parsing.

Article 11 covers de-registration. Article 26 covers the process for investigation of possible circumventions, and subsequent penalties. 26 doesn't use the phrase "de-registration." That's Article 11. Article 11 doesn't use the phrase "investigation." That's Article 26. The penalties Daly is talking about are in Article 26. I have never believed that the league is not allowed to apply penalties in a circumvention simply because the penalties are in 26 and the process is in 11. But Daly appears to be -- no, that's too strong -- okay, might be attempting to carve out an interpretation where -- against all logic -- the league can investigate a contract, decide that it's a circumvention, trigger an arbitration, get a favorable decision, and then be able to levy penalties and fines without getting rid of the contract, simply because it would have chosen (at its discretion apparently) never to utter the words "de-registration" when it moves forward with its action.

(in an arbitration under Article 11, contracts that are circumventions are voided by the arbitrator; in an arbitration under Article 26, if the arbitrator agrees with the league, there is no "shall be void" language; instead, the league has a laundry list of penalties it may apply, including voiding the contract. This is because -- as I thought was an uncontested fact but apparently is open to interpretation -- Article 26 generally applies to all manner of circumventions, not just to Article 50 circumventions, and not every circumvention requires voiding. But Article 50 circumventions are voided, as is made explicitly clear in Article 11. In order to do this tap dance, you have to assert that the fact that the provisions of Article 11 are not repeated in Article 26 means that they are in fact excluded from Article 26.)

Why do this? I don't know. Maybe because the idea of voiding the Hossa deal is so fraught with hideous complications (something about the cup...) that it's obvious the league would never go there. Daly might just be saying, look, the "death penalty" is not the only punishment possible. We can also just make you miserable (fines, cap penalties, loss of picks, etc..) without killing you. So you should still be afraid.

I maintain that it is fundamentally gibberish to assert that you can penalize a contract for being a circumvention of Article 50 and yet allow that contract to stand.

And, before you say it: no, the arbitrator is not allowed to reform the contract so it conforms to the CBA. That's only for non-Article 50 violations.

Anyway, I'm still unconvinced by my own crackpot tea-leaf reading. But at this point, it wouldn't surprise me if that's what Daly is up to.

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