The NHL needs to discuss cap recapture

[Matt_T83]

I made a thread about why the NHL's cap recapture penalty, for contracts such as Luongo's, are illegal a few years ago. I still think that, and the first team to face serious recapture penalties will most certainly challenge such penalties in court. But it's time to get serious about cap recapture because it looks like Johan Franzen is officially done. Detroit GM Ken Holland even boldly proclaimed that he doesn't even expect to see Franzen 'on the ice' anymore, not even attempting rehab.

 

Detroit should be paying 2.1 million in cap recapture penalties for Franen's contract this year, but instead have placed him on the long-term injury reserve (LTIR) to avoid such penalties. Now, we could debate whether or not Franzen deserves to be on the LTIR, but that's really not the point. This move makes it clear that teams intend to avoid cap recapture penalties by placing players on the LTIR instead of having them retire. This could even create a ridiculous situation where teams actually trade for retiring players rights in order to put them on the LTIR instead of have them retire.

 

Now, I've got absolutely no problem if every single aging player is allowed to be placed on LTIR without question. At least that creates a level playing field. But just like pathetic Gary Bettman got played with front loaded contracts, he's getting played again with the LTIR. Inevitably this sad excuse for a commissioner is going to throw a midget temper tantrum and say no more to LTIR. So some teams will avoid cap recapture penalties, and then eventually this loophole will be closed.

 

This needs to be solved now, and irks me to no end. Either the Red Wings should be forced to have a 2.1M cap recapture penalty right now, or the LTIR loophole should legally remain permanently open and never be challenged by the NHL. It's completely unacceptable to have double standards like this.

 

TL;DR: Right now the Detroit Red Wings are avoiding 2.1M in cap recapture penalties with Johan Franzen by putting him on the LTIR. It's clear that all teams will attempt to avoid such penalties this way in the future. However, eventually Bettman will throw a midget temper tantrum and close said loophole. This is a ridiculous double standard and unequal treatment of equivalent cases. The cap recapture situation should be finalized, now, instead of letting the Wings get away with this one.

[elvis15]

Hossa will be coming up at some point, and Luongo as well. Neither have injuries to put them in the LTI category to use that exemption, so we'll see what happens then. Franzen falls in the Pronger/Savard camp for me (more so Pronger for his avoidance of the 35+ rule, since Savard could retire with no penalties to the Bruins) where he should retire if he feels he'll never come back to play again, but it avoids LTI with the Wings so clearly he won't.

[coastal.view]

)i think the nhl lets this slide

they already embarked on a bit of a slippery slope

for penalizing teams that entered into these kinds of contracts when they were in fact legal (remember the league in fact has to vet, accept, and approve every nhl player contract that is signed)

this contract is now not possible.. and trying to rectify historical "abuses" imputed to certain teams is just silly

this problem is corrected and is a bit of an historical anomoly

a recent post showed that if the 3 detroit players presently on these contracts all retired in a certain year

the cap recapture penalties to the wings would be 22 million plus

you think if that were in fact imposed the nhl would risk alienating many detroit fans?

i certainly think so

just let this issue go . it's beating a dead horse

teams with these contracts have to live the anxiety of not being able to properly plan

in the event one of their players or former players abruptly decides to retire

[Nuxfanabroad]

NHL needs to time-travel BACK(Christopher Lloyd intonation) to the early 90's & contemplate integrity, going fwd. I'll wait for that.

[Nuxfanabroad]

8 minutes ago, coastal.view said:

)i think the nhl lets this slide

they already embarked on a bit of a slippery slope

for penalizing teams that entered into these kinds of contracts when they were in fact legal (remember the league in fact has to vet, accept, and approve every nhl player contract that is signed)

this contract is now not possible.. and trying to rectify historical "abuses" imputed to certain teams is just silly

this problem is corrected and is a bit of an historical anomoly

a recent post showed that if the 3 detroit players presently on these contracts all retired in a certain year

the cap recapture penalties to the wings would be 22 million plus

you think if that were in fact imposed the nhl would risk alienating many detroit fans?

i certainly think so

just let this issue go . it's beating a dead horse

teams with these contracts have to live the anxiety of not being able to properly plan

in the event one of their players or former players abruptly decides to retire

Like the Mafiosi, they'll likely look to bury problems somewhere in the desert...

[Matt_T83]

Coastal.view I respectfully disagree.  The NHL is going to let the Wings get away with it because Bettman likes them.  Then they will turn around and impose Luongo's penalty on us when he retires, and block us from putting him on the LTIR.  This is an unacceptable double standard and the Canucks should push for clarity.  

 

Either the NHL imposes all penalties on Detroit right now, or they eliminate all cap recapture penalties on contracts before the new CBA.  One or the other, I don't care.  But doing neither is criminally unacceptable.

[mll]

51 minutes ago, Matt_T83 said:

Coastal.view I respectfully disagree.  The NHL is going to let the Wings get away with it because Bettman likes them.  Then they will turn around and impose Luongo's penalty on us when he retires, and block us from putting him on the LTIR.  This is an unacceptable double standard and the Canucks should push for clarity.  

 

Either the NHL imposes all penalties on Detroit right now, or they eliminate all cap recapture penalties on contracts before the new CBA.  One or the other, I don't care.  But doing neither is criminally unacceptable.

 

Franzen is dealing with concussions.  It makes sense to put him on LTIR.

 

If a player retires he no longer receives his salary.  Franzen would be leaving 7.5M over the next 4 years on the table.  If you include last season where he only played 2 games - it's 12.5M over 5 years.   It's understandable that he is on LTIR and not retiring.

 

Luongo is not Vancouver property and it's the Panthers that would need to put him on LTIR - Vancouver does not have a say.

 

Btw they have enforced the recapture penalty for Mike Richards re the Kings.

 

[jmahyoung]

55 minutes ago, mll said:

 

Franzen is dealing with concussions.  It makes sense to put him on LTIR.

 

If a player retires he no longer receives his salary.  Franzen would be leaving 7.5M over the next 4 years on the table.  If you include last season where he only played 2 games - it's 12.5M over 5 years.   It's understandable that he is on LTIR and not retiring.

 

Luongo is not Vancouver property and it's the Panthers that would need to put him on LTIR - Vancouver does not have a say.

 

Btw they have enforced the recapture penalty for Mike Richards re the Kings.

 

Can someone explain what the cap recapture penalty is?

And so, since we're picking up a part of Luongo's salary, are we stuck with paying part of the cap recapture penalty for Luongo if Florida doesn't put him on LTIR?

 

[Toews]

2 hours ago, jmahyoung said:

Can someone explain what the cap recapture penalty is?

And so, since we're picking up a part of Luongo's salary, are we stuck with paying part of the cap recapture penalty for Luongo if Florida doesn't put him on LTIR?

 

 

[73 Percent]

All I know is the shea weber cap recapture chart is hilarious 

[mll]

4 hours ago, jmahyoung said:

Can someone explain what the cap recapture penalty is?

And so, since we're picking up a part of Luongo's salary, are we stuck with paying part of the cap recapture penalty for Luongo if Florida doesn't put him on LTIR?

 

 

In the past certain teams have handed out contracts which are significantly front loaded, where the league feels that additional years at a very low salary have been tagged along to reduce the cap hit.  They are making the assumption that team/player knew all along that they would not play out the full contract but retire early and that it was just an artificial way to reduce the cap hit.

 

For example, Luongo signed a 64M contract spread over 12 years but with a 1M salary for the final two years.  If these two years were not added - his contract value would be 62M and the cap hit 6.2M.  Adding those two years at 1M have allowed to reduce the cap hit to 5.3M.   

 

The league has identified those contracts and has decided to penalise them if the player does retire early.  

 

Teams close to the cap like Chicago, LA, etc would probably not have had the same roster when they won the Cup if not for these type of contracts.  

 

Carter, Chara, Crosby, Franzen, Hossa, Keith, Kronwall, Myers, Luongo, Parise, Quick, Suter, Weber and Zetterberg are the ones remaining.  Some are more striking than others.    

 

Weber was an offer sheet and the Predators could have had him at a 14M cap hit (his salary the 4 years he was in Nashville under that contract) without exceeding their cap so they have an argument to challenge it as it was not their doing.  Parise and Suter have matching contracts where they only receive 4M over the final 3 years of a 98M contract.  

 

The penalty is defined as the cap advantage the team received spread over the remaining years between early retirement and the end of the contract.  

 

At the date of the trade the Canucks have paid Luongo circa 8M more than his cap hit.  The league is saying that this is now going to be a penalty (recapture cap hit) against Vancouver.  The amount will be spread over the remaining years of his contract.  (The calculation is a bit more complex because of the 15% salary retention but same principle).  

 

The Canucks can avoid the penalty if he goes on LTIR - but that's a Panther decision, or if he is bought out (also a Panther decision).  A buyout is unlikely as it is a higher cap hit for the Panthers than their own recapture penalty which is minimal.  

 

[Matt_T83]

7 hours ago, mll said:

 

Franzen is dealing with concussions.  It makes sense to put him on LTIR.

 

If a player retires he no longer receives his salary.  Franzen would be leaving 7.5M over the next 4 years on the table.  If you include last season where he only played 2 games - it's 12.5M over 5 years.   It's understandable that he is on LTIR and not retiring.

 

Luongo is not Vancouver property and it's the Panthers that would need to put him on LTIR - Vancouver does not have a say.

 

Btw they have enforced the recapture penalty for Mike Richards re the Kings.

 

 

The problem here is that Franzen isn't actually attempting to come back. It's clear as day that last year he decided he wanted to retire. He went on the LTIR 1 year ago. Fine, I accept him going on LTIR for the 2015-2016 season because he did have concussion symptoms. However, he is fit to play now, I guarantee it. He just doesn't want to play anymore because he wants to retire. It's outright illegal to be on the LTIR if you are not actively attempting a return to the sport. 

 

This is a quote from the HB forums: "If you think Kronwall and Ericsson mentioning thier injuries publicly is by chance? This is probably advised by both the club AND their agents. To make sure just in case that their contracts are not contested by the league. Let everyone know you are really injured. Ensure your contract will not be contested as fraud when you go on LTIR."

 

It's clear as day the Red Wings / Agents are coaching these players to exaggerate their symptoms and speak out in public about their 'symptoms'. These players want to retire. End of story.  This is a joke and people should be absolutely outraged.

 

[jmahyoung]

4 hours ago, mll said:

 

In the past certain teams have handed out contracts which are significantly front loaded, where the league feels that additional years at a very low salary have been tagged along to reduce the cap hit.  They are making the assumption that team/player knew all along that they would not play out the full contract but retire early and that it was just an artificial way to reduce the cap hit.

 

For example, Luongo signed a 64M contract spread over 12 years but with a 1M salary for the final two years.  If these two years were not added - his contract value would be 62M and the cap hit 6.2M.  Adding those two years at 1M have allowed to reduce the cap hit to 5.3M.   

 

The league has identified those contracts and has decided to penalise them if the player does retire early.  

 

Teams close to the cap like Chicago, LA, etc would probably not have had the same roster when they won the Cup if not for these type of contracts.  

 

Carter, Chara, Crosby, Franzen, Hossa, Keith, Kronwall, Myers, Luongo, Parise, Quick, Suter, Weber and Zetterberg are the ones remaining.  Some are more striking than others.    

 

Weber was an offer sheet and the Predators could have had him at a 14M cap hit (his salary the 4 years he was in Nashville under that contract) without exceeding their cap so they have an argument to challenge it as it was not their doing.  Parise and Suter have matching contracts where they only receive 4M over the final 3 years of a 98M contract.  

 

The penalty is defined as the cap advantage the team received spread over the remaining years between early retirement and the end of the contract.  

 

At the date of the trade the Canucks have paid Luongo circa 8M more than his cap hit.  The league is saying that this is now going to be a penalty (recapture cap hit) against Vancouver.  The amount will be spread over the remaining years of his contract.  (The calculation is a bit more complex because of the 15% salary retention but same principle).  

 

The Canucks can avoid the penalty if he goes on LTIR - but that's a Panther decision, or if he is bought out (also a Panther decision).  A buyout is unlikely as it is a higher cap hit for the Panthers than their own recapture penalty which is minimal.  

 

 

Maybe Florida would put Luongo on LTIR for a 6th rounder ...

 

[Westcoasting]

Why is anything an issue if both sided agreed to this while making the collective agreement?

 

[Gurn]

^ Because some teams signed these deals when it was allowed by the existing CBA, then the league/players changed the CBA and went back and punished teams for deals that were legal when signed.

 

[Matt_T83]

1 hour ago, Westcoasting said:

Why is anything an issue if both sided agreed to this while making the collective agreement?

 

 

This is a problem because cap recapture is going to be enforced unevenly. Right now they are allowing Detroit, a team they like, to use the LTIR to avoid cap recapture penalties. They may let other teams get away with it as well. But eventually Bettman will put his midget foot down and stop allowing this avoidance of cap recapture. So some teams will get away without any penalty (Detroit), while others will likely be stuck footing the bill (Vancouver). 

 

This double standard is not only unacceptable it's also illegal. But then the Canucks will be forced to go to court and fight this ridiculous double standard, and look like the bad guys. Thus, the NHL should be forced to deal with this now and make Franzen's case the gold standard. If Franzen is allowed to stay on the LTIR, then ALL future front-loaded contract players will, without question, also be allowed on the LTIR.

[coastal.view]

On 2016-10-18 at 0:39 PM, Matt_T83 said:

 

This is a problem because cap recapture is going to be enforced unevenly. Right now they are allowing Detroit, a team they like, to use the LTIR to avoid cap recapture penalties. They may let other teams get away with it as well. But eventually Bettman will put his midget foot down and stop allowing this avoidance of cap recapture. So some teams will get away without any penalty (Detroit), while others will likely be stuck footing the bill (Vancouver). 

 

This double standard is not only unacceptable it's also illegal. But then the Canucks will be forced to go to court and fight this ridiculous double standard, and look like the bad guys. Thus, the NHL should be forced to deal with this now and make Franzen's case the gold standard. If Franzen is allowed to stay on the LTIR, then ALL future front-loaded contract players will, without question, also be allowed on the LTIR.

all i can say is that you are a really crappy lawyer

if you think the present application of these terms is somehow "illegal"

and that the canucks would go to court over this

stick with what you really know and don't step into a realm in which you are clearly ignorant

[\/ijay]

What I really don't like about the recapture penalty is that it punishes the team if the player plays for longer. That makes no sense to me as the longer the player plays the more legit the contract is.

[King Heffy]

This is why the Luongo trade is such an unmitigated disaster.  We don't even have the ABILITY to do this kind of thing due to Gillis deciding to cripple the team's future.

[oldnews]

mickey mouse league had the power to deny the contracts at the time.

they didn't.  they approved them.

retroactively imposing punishment when the CBA at the time did not prohibit these deals is ridiculous.