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Circumventing the Entry-Level System

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07-07-2005, 01:53 PM
  #1
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Circumventing the Entry-Level System

Quick question to those who know the old CBA more than me... Since the new one is probably going to be modeled like the old one (with loophole and number changes), what's to prevent a team from doing this:



Caps sign AO to max rookie contract (4yrs). Assume that AO excells after year one. Then can the Caps offer AO to a new contract, say 8yrs/40M, to replace the entry contract? Could they even propose this idea PRIOR to signing the entry level contract?

Note: Replace Caps with team x and Crosby for AO if you like....

Just a thought in all of this Swiss league/RSL/NHL debate that's going around.

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07-07-2005, 01:55 PM
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Quote:
Originally Posted by heshootshescores
Quick question to those who know the old CBA more than me... Since the new one is probably going to be modeled like the old one (with loophole and number changes), what's to prevent a team from doing this:



Caps sign AO to max rookie contract (4yrs). Assume that AO excells after year one. Then can the Caps offer AO to a new contract, say 8yrs/40M, to replace the entry contract? Could they even propose this idea PRIOR to signing the entry level contract?

Note: Replace Caps with team x and Crosby for AO if you like....

Just a thought in all of this Swiss league/RSL/NHL debate that's going around.
i'm sure there will be rules against this sort of thing

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07-07-2005, 02:00 PM
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Chances are extremely high that the new contract would be rejected as a violation of the CBA.

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07-07-2005, 02:11 PM
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so your guys believe that contract extensions will be illegal in the new CBA? Or simply that they must be added to the end of the entry level contract?

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07-07-2005, 02:14 PM
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A contract extension is different from what you are talking about. I strongly doubt that any team will be allowed to replace a rookie contract.

However, if the Caps (as an example) wanted to risk $40 million on Ovechkin as an 8 year extension that begins after the rookie deal expires, I dont see a problem with it. Of course, they would be risking destroying their ability to win if Ovechkin were to be a bust or underperform, as that would pretty much become dead cap space.

I would suggest that an eight year contract is the most far-fetched aspect of your scenario for that very reason.

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07-07-2005, 02:17 PM
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Of course they say nothing to the affec tthat the first contract could be for one year at the max they can give for the rookie and then sign the said rookie to a new contract for ridiculous amounts of money after the season starts for say the next five years.

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07-07-2005, 02:17 PM
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How about:

Owner 'X' gives Coca Cola (invests in) 5M$. Coca Cola then endorses, a few months later, player 'Y' for 5M$ whom happens to play for Owner 'X'...

Legal
Possible

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07-07-2005, 02:18 PM
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Quote:
Originally Posted by heshootshescores
Quick question to those who know the old CBA more than me... Since the new one is probably going to be modeled like the old one (with loophole and number changes), what's to prevent a team from doing this:

As much scrutinizing each sides lawyers have done on this document I am not sure there will be any loopholes. This is going to be the most thorough cba in the history of sports imho.

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07-07-2005, 02:20 PM
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Quote:
Originally Posted by spartyinmd
Of course they say nothing to the affec tthat the first contract could be for one year at the max they can give for the rookie and then sign the said rookie to a new contract for ridiculous amounts of money after the season starts for say the next five years.
Uhm, I'm pretty sure the entry level contracts will also have a minimum duration. Either 3 years or 4 (I believe it's 4). To avoid exactly what you're proposing.

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07-07-2005, 02:23 PM
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Quote:
Originally Posted by tmg
Uhm, I'm pretty sure the entry level contracts will also have a minimum duration. Either 3 years or 4 (I believe it's 4). To avoid exactly what you're proposing.
Agreed. Maybe I am naive, but I refuse to believe that the NHL would allow such an obvious loophole. Most loopholes require quite a bit of creative thinking. The sign to one year loophole is incredibly obvious and has probably been addressed in many other major leagues (NFL, NBA) as well as well as the last NHL CBA. It's just too easy to let it slide.

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07-07-2005, 02:32 PM
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Quote:
Originally Posted by tmg
Uhm, I'm pretty sure the entry level contracts will also have a minimum duration. Either 3 years or 4 (I believe it's 4). To avoid exactly what you're proposing.
I remember hearing that the league was trying to get it set where no contract was longer then 3 or 4 years, entry level or not. Trying to cut down on the Jagr/Yashin type contracts.

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07-07-2005, 02:35 PM
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Quote:
Originally Posted by SmokeyClause
Agreed. Maybe I am naive, but I refuse to believe that the NHL would allow such an obvious loophole. Most loopholes require quite a bit of creative thinking. The sign to one year loophole is incredibly obvious and has probably been addressed in many other major leagues (NFL, NBA) as well as well as the last NHL CBA. It's just too easy to let it slide.
Sean Taylor (pre-arrest) was asking for a new contract after 1 year. The NFL addresses rookie contracts through allowing a "pool" of money being used to sign rookies. Throughout Taylor's contract debate, there was never any discussion on how the "pool" would be affected by him potentially getting a new contract.

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07-07-2005, 02:37 PM
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Why is an entry level system even needed with a hard cap? If a team can create the cap room, they should be able to pay any player whatever they want.

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07-07-2005, 02:37 PM
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Quote:
Originally Posted by Resolute
A contract extension is different from what you are talking about. I strongly doubt that any team will be allowed to replace a rookie contract.

However, if the Caps (as an example) wanted to risk $40 million on Ovechkin as an 8 year extension that begins after the rookie deal expires, I dont see a problem with it. Of course, they would be risking destroying their ability to win if Ovechkin were to be a bust or underperform, as that would pretty much become dead cap space.

I would suggest that an eight year contract is the most far-fetched aspect of your scenario for that very reason.
I used 8 years cause I wanted to include the last 3 of the original contract... thus giving the Caps 5 extra years of service for what may be a cheaper price (benefit) for the cost of losing the 3 cheaper years.

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07-07-2005, 02:41 PM
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Quote:
Originally Posted by Buffaloed
Why is an entry level system even needed with a hard cap? If a team can create the cap room, they should be able to pay any player whatever they want.
I believe the only reason is to prevent rookies from "holding a gun" to the owners head. And this system will work for the 99.9% of rookies.

However, for the very very few players that could outperform, I do not see any reason why a team should be prevented from giving the guy a new contract. Depending on how signing bonuses work in this cap system, this could be beneficial to teams in this situation over the long term.

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07-07-2005, 02:45 PM
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Quote:
Originally Posted by Buffaloed
Why is an entry level system even needed with a hard cap? If a team can create the cap room, they should be able to pay any player whatever they want.
As a basic form of control over rookie salaries, to make it more palatable for individual players to sign on the dotted line, since there could be no better deal from any other team. Take Ovechkin - with no cap on rookie salaries, Ovechkin's agent could turn around and say "You have $12M in room before you hit the salary cap, and I want $6M per year of it." This streamlines the negotiation process to make it easier to get draftees under contract.

EDIT: What heshootshescores said.

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07-07-2005, 02:45 PM
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Quote:
Originally Posted by heshootshescores
so your guys believe that contract extensions will be illegal in the new CBA? Or simply that they must be added to the end of the entry level contract?
The answer to this type of question would be in the rules of buyouts of contracts and can a entry level contract be bought out in a Hard Cap world ..

I see the rules saying similar to what I am hearing you can't resign a player you buyout but think about buyout and trade ..

Then the Caps could gain in player returns for Ovechkin .. So Caps sign Ovenckin to a ELS contract and Ovechkins basically holds out saying his is not playing .. So Washington buys him out in a trade deal for a Lindros type deal that would benefit them ..

Pick Crosby .. A small market team wins the lottery and selects him, signs him but he refuses to play for them .. So they orchestrate a buyout with trade to Montreal for a nice package of prospects, players and picks and then when Montreal gets him Crosby in no longer bound by the ELS because it is no longer his FIRST NHL contract ..

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07-07-2005, 02:48 PM
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Quote:
Originally Posted by The Messenger
The answer to this type of question would be in the rules of buyouts of contracts and can a entry level contract be bought out in a Hard Cap world ..

I see the rules saying similar to what I am hearing you can't resign a player you buyout but think about buyout and trade ..

Then the Caps could gain in player returns for Ovechkin .. So Caps sign Ovenckin to a ELS contract and Ovechkins basically holds out saying his is not playing .. So Washington buys him out in a trade deal for a Lindros type deal that would benefit them ..

Pick Crosby .. A small market team wins the lottery and selects him, signs him but he refuses to play for them .. So they orchestrate a buyout with trade to Montreal for a nice package of prospects, players and picks and then when Montreal gets him Crosby in no longer bound by the ELS because it is no longer his FIRST NHL contract ..
In this scenario when you buy him out, he is a free agent and not a tradeable asset....????

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07-07-2005, 03:04 PM
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Quote:
Originally Posted by The Messenger
Pick Crosby .. A small market team wins the lottery and selects him, signs him but he refuses to play for them .. So they orchestrate a buyout with trade to Montreal for a nice package of prospects, players and picks and then when Montreal gets him Crosby in no longer bound by the ELS because it is no longer his FIRST NHL contract ..
Eh, why would he sign & then refuse to play?

He'd just hold out, refuse to sign & they'd trade his rights, which would still make him rookie status...

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07-07-2005, 03:17 PM
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Quote:
Originally Posted by Buffaloed
Why is an entry level system even needed with a hard cap? If a team can create the cap room, they should be able to pay any player whatever they want.
Finally ... a pro-cap guy who makes sense.

To many people seem to be lined up on one side or the other, and they are unable to stray from party lines in these discussions.
Therefore, if you're pro-owner, you have to be against every player trying to make more money.
And if you're pro-pa, you're against all attempts to keep salaries down.

Lost is the ability to address each other's points.

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07-07-2005, 03:24 PM
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Quote:
Originally Posted by spartyinmd
Of course they say nothing to the affec tthat the first contract could be for one year at the max they can give for the rookie and then sign the said rookie to a new contract for ridiculous amounts of money after the season starts for say the next five years.
If the CBA states that entry level contracts have to be for four years, guess what? The contracts have to be written for four years.

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07-07-2005, 03:28 PM
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Quote:
Originally Posted by Buffaloed
Why is an entry level system even needed with a hard cap? ...
It harnesses salary inflation.

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07-07-2005, 03:45 PM
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Quote:
Originally Posted by Buffaloed
Why is an entry level system even needed with a hard cap? If a team can create the cap room, they should be able to pay any player whatever they want.
If you start your rookies out at a really high salary, you're cutting the team off from cap space it needs to pay veterans. If a team were to pay Sidney Crosby, oh, $4M, look at how much more cap space youíve eaten up. Each year that amount goes up, other rookies want more.... salary escalation! I think the whole purpose of the CBA was to get that under control.

Say he goes to the Bolts (and I only use them because I have a rough handle on our salaries) for $4M. Lecavalierís, Richardsí and Kubinaís salaries (to name a few) would be less than a totally untested, unproven rookie who has never set foot on NHL ice. I have a feeling they wonít be happy about that. How does the GM make them happy, stay below the cap & put a full contingent of players on the ice? Cap problems. Unhappy players. Not worth it.

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07-07-2005, 03:47 PM
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Quote:
Originally Posted by Boltsfan2029
Eh, why would he sign & then refuse to play?

He'd just hold out, refuse to sign & they'd trade his rights, which would still make him rookie status...
In a plan to force a trade and are in on the buyout /trade plan with its current team .. The goal isn't to get the player to play its to get the trade package and for the player to get the bigger contract on his second deal ..

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07-07-2005, 03:56 PM
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Article 9.1 a) of the current CBA says....
No Club may enter into a Player Contract with a Rookie
(excluding a player who is age 25 or older) that provides for
Compensation in excess of that permitted by this Article.


In other words, the fact that its a player's first contract, second contract, whatever - doesn't matter one bit. It's an age restriction - the first four years of your career, assuming you are under the age of 25, you are subject to the rookie cap.

End of discussion, I hope.

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