During the next few days you might hear how the ruling by independent arbitrator Richard Bloch on Ilya Kovalchuk’s contract was a shocking decision. There are a handful of other salary cap-circumventing deals already in existence the NHL didn’t challenge, so how could this one be overturned?
I don’t know about you, but to me this was an obvious call from the moment the league challenged the contract. While Kovalchuk’s deal wasn’t the only one constructed to circumvent the cap, it was by far the most obvious attempt and it was time to draw a line in the sand.
Kudos to the NHL for stepping to the plate and a hearty applause to Bloch for backing up the decision.
You’ll probably also hear how it’s ridiculous a contract like this can be overturned when other “similarly structured” pacts are allowed. While the other deals (i.e. Henrik Zetterberg, Johan Franzen, Marian Hossa) are similar in the sense they are front-end loaded to bring the overall cap hit down, they do not go nearly as far as the Devils did with Kovalchuk. And when you look closely, they really aren’t all that similar.
During the final six years of the Kovalchuk contract, he was to make a total of $3.5 million. That means he was scheduled to earn 97 percent of the total value of the contract in the first 11 years, taking him to 37 years old. The deal would end when Kovalchuk was 44 and only six players in the past 20 years have played to their 42nd birthday.
How is that different than the others? Easy.
Marian Hossa’s deal will expire when he is 42, but he’ll still at least be making $4 million in 2016-17 and $4 million total during the final four years.
Henrik Zetterberg and Johan Franzen see their deals drop off so they both make $2 million over the final two years of their pacts, but they expire when the players are 40 years old. There is no reason to believe either is incapable or unwilling to play until that age.
Mike Richards and Alex Ovechkin have contracts that expire when they are 35 and both make good money at the tail end (Richards will make $3 million in each of the final two seasons and Ovechkin will be making $10 million in each of the final seven years).
Chris Pronger’s contract expires when the big man is 42 and he will make $525,000 in each of the final two years. While that is a significant drop from the $4 million he’ll earn in 2014-15, because Pronger will be 35 when the deal kicks in, even if he retires after that season the Flyers are still on the hook for his nearly $5 million cap hit until 2017. Does the structure bring down the salary cap hit? Yes. But it’s a whole different beast the Flyers could pay for down the road and that’s why Pronger’s contract is irrelevant when it comes to comparisons.
The only other deal that really stinks is Vancouver’s pact with Roberto Luongo. The deal ends when he’s 43 and pays him a total of $3.6 million over the final three years. Still, Luongo will make at least $1 million per season towards the end and given the $1.3-million deal 34-year-old Marty Turco just signed with Chicago, Luongo’s $1.6 million stipend at 40 isn’t unreasonable.
But Kovalchuk making $750,000 at 37? That’s not right; it’s way below market value. Consider Mark Recchi can earn nearly $2 million with bonuses this coming season, and he’ll be 43 in February.
If you believe those other deals should be rejected you’re not alone. But the fact they haven’t been turned down is no reason to call out the league for challenging Kovalchuk and the Devils. One small mistake doesn’t mean you should overlook one big one.
The bottom line is the Kovalchuk deal went further in its cap-circumventing egregiousness than any before and there are clauses in the CBA that specifically allow the league to reject deals that skirt the cap; they are designed to “prohibit and prevent conduct that Circumvents the terms of (the) Agreement.”
If the Kovalchuk contract doesn’t call for the league to take action, what would?
While all the other deals in question stayed within reason in terms of salary and term, the Kovalchuk contract immediately made me wonder aloud “When will someone sign a deal through to their 50th birthday?” If this one was allowed, it would open a Pandora’s box of questionable contracts.
That’s why it was overturned and that’s why it was a no-brainer to do so.
THN Puck Panel: Analyzing the Ilya Kovalchuk contract
PRODUCER: Ted Cooper
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