Earlier this month, an arbitrator upheld the NHL's decision to reject Ilya Kovalchuk's 17-year, $102 million contract with the Devils. New Jersey was hoping for the deal to go through like many similar ones have in the past, as its length allows for a smaller cap hit. The problem for the Devils is that the structure of the deal made their salary cap circumvention a little too obvious, which caused it to be rejected.â†µ
The Red Wings really helped start the trend of lengthy contracts, as they gave Henrik Zetterberg a 12-year extension and Johan Franzen an 11-year extension. While those contracts span a long timeframe, the salaries for Zetterberg and Franzen only gradually decrease in the later years of the deal, and they never drop below $1 million a season. That, along with the fact that the contracts only have them playing until they're 40, is why the NHL is not investigating their deals.â†µ
Bloch pointed out that contracts for Roberto Luongo, Marc Savard, Marian Hossa and Chris Pronger remain under investigation by the league even though they were all registered by the NHL. If the league, emboldened by Bloch’s decision, decides to reject them, all of the players could become unrestricted free agents. This resulted in the usual consternation among player agents.â†µ
While no one would speak publicly, it was pointed out that Henrik Zetterberg, Vincent Lecavalier and Duncan Keith all have contracts similar to Luongo and company but none of them was put on notice.â†µ
The main issue with these deals is the structure of them. In Kovalchuk's contract (had it not been rejected), for example, the final five years were supposed to be worth only $550,000 a season. The contract also would have had him playing until he's 44, leading many to believe he wouldn't play out the entire contract. For Zetterberg and Franzen, it's expected that they will play out their deals, plus their salaries don't drastically drop in the final years. In that regard, while Ken Holland did use lengthier deals to lessen the cap hit a bit, he didn't straight up circumvent the salary cap like the Devils did with Kovalchuk.