The NHL is wrong and the New Jersey Devils are right. The NHL fined the New Jersey Devils $3 Million and their 3rd round pick in 2011 along with a future 1st round pick to be determined. There is no question that The Devils were trying to lower their cap number. Signing Kovalchuk to a 17 year contract is a joke. Everyone can see what they were trying to do. If you need a quick salary cap lesson; here we go.
A player’s salary cap hit equals his average salary over the length of the contract. If you have a 3 year contract with yearly salaries of $5, $6, and $7Million then the average is $6 Million. Therefore the cap hit is $6Million in all 3 years even though in year 1 the player makes less and makes more in year three.
The Devils were paying the sniper in the ‘hood of $10 Million for the next few years, but tacked on 4 years of 550k at the tail end of the contract. These years would most likely be ‘bought out’, meaning that Kovalchuk and the Devils never intended on completing all 17 years of the contract. Seeing this obvious circumvention of the salary cap the NHL stepped in and won an arbitration contest. This forced The Devils to restructure the contract and re-submit to the league. The new deal was barely different; 2 less years with slightly less egregious latter year amounts. It could've been argued that The Devils were still up to no good, but the NHL went and approved the 15 year deal. The NHL also re-wrote language that closed the loophole that the Devils were using to circumvent the salary cap.
This is where the story should have ended.
HOWEVER, The NHL added a punitive fine and draft-pick penalty. The NHL is wrong in so many ways.
Let me list the ways that the NHL is wrong.
1) The Devils used a loophole; a loophole that was left open in the last collective bargaining agreement. There’s nothing illegal about using a loophole. People use tax loopholes all the time. The IRS closes loopholes as they are found, but it doesn’t fine the individual citizen or company who discovered the loophole.
2) Hey NHL, IF YOU DIDN’T LIKE THE CONTRACT THEN WHY DID YOU APROVE IT? They could’ve rejected deal #2 and told the Devils to try again. But instead they approved the deal which is hypocritical. So you’re going to approve the contract but at the same time fine the team and say that it’s not ok? Which is it? Is it ok or not? I’m confused.
3) The Devils did not cheat like Bill Belichick. They did not break a law like Michael Vick. They merely challenged the status quo. If anything the Devils helped the league identify an issue and prevent further abuse.
4) The precedent this sets is that whenever you disagree with the NHL, we’ll fine you. The NHL had a problem (an ineffective salary cap) but they are tossing the blame on The Devils. I guess we’re just going to live in a dictatorship now where the NHL gets excused from their mistakes and teams take the blame. As one comment on TSN.com put it, ‘circumvention would not exist, if the N.H.L's lawyers, who wrote the rules, were remotely competent.’
Maybe the NHL is still angry at the Devils for inventing the neutral zone trap, making hockey boring and winning so many Stanley Cups.
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