[News] Kings terminate Richards contract. UPD: Kings and Richards reach settlement

[Phanuthier]

Originally Posted by GioforPM

Except like I said above, there's not much to lose by giving it a shot. If Richards/the NHLPA wins, the contract gets reinstated and they owe him some money. He wasn't playing in the bigs anyway.

I'm interested in the NHL's take. On the one hand, they would like to decrease players' power which would include more termination rights. On the other hand, they don't want cap circumvention. If the Kings win, how many more terminations can they expect?

Disagree. There is a A LOT to lose if they do this on a very flimsy basis (legally). I would be shocked if that is the case. The magnitude of this, should they not have a pretty solid case, could be very damaging legally, financially (millions of dollars, that would exceed what they would lose in a buyout case), reputation wise, etc.

[CorsiHockeyLeague]

Originally Posted by Resolute 14

It isn't just that the Kings would "owe him some money", but that most of that money would hose LA's cap. So that puts the NHL in a very tough spot - the buy out window is done and gone, and his waiver clearance will likewise expire long before this settles. So what does the NHL do if the Kings lose the grievance?

I assume that both parties will just do whatever the Arbitrator tells them to do. I expect the arbitrator will have broad decision-making powers.

Originally Posted by Locke

Experience.

No one has experience in this area. This is a really unique CBA structure with a whole lot of extraneous factors that have a huge effect on decision-making.

I know people love the concept that lawyers throw anything anywhere in hopes that something will stick but that's not typically the reality at this level. This ain't your Grandmammy's kitchen reno or 'Pa's restraining order. And everyone involved with the exception of Mike Richards is a lawyer and millions of dollars are at stake.

You really don't think far-fetched positions are taken with millions of dollars at stake? I'm working on one right now as soon as I finish typing this. The higher the sophistication, the more decision-making is done on the basis of a risk analysis. In this circumstance, it seems to me that the risk to the Kings is low - any order that would result from a dispute resolution process would likely put them right back where they were before, with Richards on the Monarchs. Maybe they have to pay a fine. The upside if they're successful is obviously huge. The chances of success may be low, but someone may have just decided that it's worth a roll of the dice given the lack of downside.

Originally Posted by Phanuthier

Disagree. There is a A LOT to lose if they do this on a very flimsy basis (legally). I would be shocked if that is the case. The magnitude of this, should they not have a pretty solid case, could be very damaging legally, financially (millions of dollars, that would exceed what they would lose in a buyout case), reputation wise, etc.

Lol at "reputation wise"... as if the casual fan gives a crap about a CBA dispute. Damaging "legally"? I don't even know what that means. Financially, as noted, they're back where they were before, most likely - how are they losing "millions of dollars"?

[Phanuthier]

Originally Posted by CorsiHockeyLeague

Lol at "reputation wise"... as if the casual fan gives a crap about a CBA dispute. Damaging "legally"? I don't even know what that means. Financially, as noted, they're back where they were before, most likely - how are they losing "millions of dollars"?

Not just fans, but their own team and perspective players in the future.

Originally Posted by CorsiHockeyLeague

No one has experience in this area. This is a really unique CBA structure with a whole lot of extraneous factors that have a huge effect on decision-making.
You really don't think far-fetched positions are taken with millions of dollars at stake? I'm working on one right now as soon as I finish typing this. The higher the sophistication, the more decision-making is done on the basis of a risk analysis. In this circumstance, it seems to me that the risk to the Kings is low - any order that would result from a dispute resolution process would likely put them right back where they were before, with Richards on the Monarchs. Maybe they have to pay a fine. The upside if they're successful is obviously huge. The chances of success may be low, but someone may have just decided that it's worth a roll of the dice given the lack of downside.

So in this one that you are working on right now, did one side "threw crap at the wall and see what sticks" ?

[Locke]

Originally Posted by CorsiHockeyLeague

I assume that both parties will just do whatever the Arbitrator tells them to do. I expect the arbitrator will have broad decision-making powers.

No one has experience in this area. This is a really unique CBA structure with a whole lot of extraneous factors that have a huge effect on decision-making.

You really don't think far-fetched positions are taken with millions of dollars at stake? I'm working on one right now as soon as I finish typing this. The higher the sophistication, the more decision-making is done on the basis of a risk analysis. In this circumstance, it seems to me that the risk to the Kings is low - any order that would result from a dispute resolution process would likely put them right back where they were before, with Richards on the Monarchs. Maybe they have to pay a fine. The upside if they're successful is obviously huge. The chances of success may be low, but someone may have just decided that it's worth a roll of the dice given the lack of downside.

Why do people keep thinking that the risk to the Kings is low?

Resolute's post is a great example.

They filed to have the contract terminated and the League agreed. Theres likely going to be a grievance but if the Kings lose that grievance they've likely:

- Exceeded the cap illegally for the summer
- Missed the buyout window
- Missed the waiver window
- Missed opportunities to trade him

Those are some pretty serious consequences so I disagree that theres no risk for the Kings because it looks like if they lose their grievance they are likely stuck not only with Richards' cap hit and money but also a pretty disgruntled player on their main roster.

[Resolute 14]

Originally Posted by CorsiHockeyLeague

I assume that both parties will just do whatever the Arbitrator tells them to do. I expect the arbitrator will have broad decision-making powers.

Maybe. I don't have any clue how the arbitration process would work this regard, but logic tells me that this should be a binary issue. Is the termination valid, or not? If not, status quo ante. At that point, the Kings would have to figure things out in a hurry.

[cam_wmh]

Originally Posted by Locke

Why do people keep thinking that the risk to the Kings is low?

Resolute's post is a great example.

They filed to have the contract terminated and the League agreed. Theres likely going to be a grievance but if the Kings lose that grievance they've likely:

- Exceeded the cap illegally for the summer
- Missed the buyout window
- Missed the waiver window
- Missed opportunities to trade him

Those are some pretty serious consequences so I disagree that theres no risk for the Kings because it looks like if they lose their grievance they are likely stuck not only with Richards' cap hit and money but also a pretty disgruntled player on their main roster.

Arbitrator may, award them a new window, and perhaps reduce the cap penalties somewhat due to the short time frame they had available to trade Richards contract, AND to buy him out -- where were impacted in the immediate time-frame by his border crossing conundrum.

[Locke]

Originally Posted by cam_wmh

Arbitrator may, award them a new window, and perhaps reduce the cap penalties somewhat due to the short time frame they had available to trade Richards contract, AND to buy him out -- where were impacted in the immediate time-frame by his border crossing conundrum.

Very true, they may get some relief, but its not like the Kings are just shrugging their shoulders and figuring that one way or the other its no big deal.

[CorsiHockeyLeague]

Originally Posted by Locke

Why do people keep thinking that the risk to the Kings is low?

Resolute's post is a great example.

They filed to have the contract terminated and the League agreed. Theres likely going to be a grievance but if the Kings lose that grievance they've likely:

- Exceeded the cap illegally for the summer
- Missed the buyout window
- Missed the waiver window
- Missed opportunities to trade him

Those are some pretty serious consequences so I disagree that theres no risk for the Kings because it looks like if they lose their grievance they are likely stuck not only with Richards' cap hit and money but also a pretty disgruntled player on their main roster.

I assume they did this because they couldn't get a trade for him that wouldn't hurt them significantly (no return of value and lots of salary retention). The waiver window matters not at all, no one's claiming the guy now. The buyout window assumes they were willing to go that route, but if so the downside there is worth about a million in real dollars I think? When is their next opportunity to buy him out?

Note that it wouldn't be impossible for them to lose, go back where they were before and then separately ask the NHL for some special dispensation allowing for a late buyout (or possibly the arbitrator would be willing to throw them a bone there).

Originally Posted by Resolute 14

Maybe. I don't have any clue how the arbitration process would work this regard, but logic tells me that this should be a binary issue. Is the termination valid, or not? If not, status quo ante. At that point, the Kings would have to figure things out in a hurry.

Nah, often the arbitrator can award whatever they want. But it really depends on what the rules of the proceedings are. Not saying you're wrong, but it seems unlikely to me.

Originally Posted by cam_wmh

Arbitrator may, award them a new window, and perhaps reduce the cap penalties somewhat due to the short time frame they had available to trade Richards contract, AND to buy him out -- where were impacted in the immediate time-frame by his border crossing conundrum.

Yup, could be. I think that would be pretty nice, but arbitrators, at least in commercial cases, are well known for trying to split the baby.

[Resolute 14]

Originally Posted by cam_wmh

Arbitrator may, award them a new window, and perhaps reduce the cap penalties somewhat due to the short time frame they had available to trade Richards contract, AND to buy him out -- where were impacted in the immediate time-frame by his border crossing conundrum.

That would be an interesting option given that if the Kings' effort to terminate the contract is rejected, the arbitrator would be implying that the team's actions were cap circumvention.

[KootenayFlamesFan]

Originally Posted by CorsiHockeyLeague

You really don't think far-fetched positions are taken with millions of dollars at stake? I'm working on one right now as soon as I finish typing this.

Millions of dollars are at stake and you're putting it off until you post something on CP?

[CorsiHockeyLeague]

I've been working on it for two years, I was working on it until 11pm last night and will be doing so again today. If I don't take a break from reading stuff to post about meaningless nonsense a few times a day, I'll go nuts.

So yes

[KootenayFlamesFan]

Originally Posted by cam_wmh

Arbitrator may, award them a new window, and perhaps reduce the cap penalties somewhat due to the short time frame they had available to trade Richards contract, AND to buy him out -- where were impacted in the immediate time-frame by his border crossing conundrum.

That's what I was wondering may happen as well. Which would be a massive help to the Kings.

[Phanuthier]

Originally Posted by CorsiHockeyLeague

I've been working on it for two years, I was working on it until 11pm last night and will be doing so again today. If I don't take a break from reading stuff to post about meaningless nonsense a few times a day, I'll go nuts.

So yes

I'm not a lawyer, but I can't imagine doing something that has pretty much no chance of succeeding (and not doing the proper DD) just cause. I'm curious, as a lawyer who handles multi-million dollar cases like this, do they often try for these lottery ticket wins? I doubt it, but I'm not a lawyer that works on these types of big tickets.

[GioforPM]

Originally Posted by Locke

Why do people keep thinking that the risk to the Kings is low?

Resolute's post is a great example.

They filed to have the contract terminated and the League agreed. Theres likely going to be a grievance but if the Kings lose that grievance they've likely:

- Exceeded the cap illegally for the summer
- Missed the buyout window
- Missed the waiver window
- Missed opportunities to trade him

Those are some pretty serious consequences so I disagree that theres no risk for the Kings because it looks like if they lose their grievance they are likely stuck not only with Richards' cap hit and money but also a pretty disgruntled player on their main roster.

Did the League agree? I missed that.

Anyway, I don't think they were close to a trade at any point. Plus, they already had a pretty disgruntled player (who will not be on the NHL roster - you can bank on that).

The cap hit is the biggest risk going forward, but are they over now with his salary or just really close? Anyway, I thought that the cap only applied during the season anyway - you can go over as long as you fix it by the start of the regular season. And then I think they can buy him out.

[GioforPM]

Originally Posted by Phanuthier

I'm not a lawyer, but I can't imagine doing something that has pretty much no chance of succeeding (and not doing the proper DD) just cause. I'm curious, as a lawyer who handles multi-million dollar cases like this, do they often try for these lottery ticket wins? I doubt it, but I'm not a lawyer that works on these types of big tickets.

"No chance" is not something a lawyer recommends. "Remote chance" or "probably unsuccessful" might be taken depending on the cost-benefit analysis.

And clients who think they are in the right often instruct a lawsuit to be taken even where the advice is "probably not successful". After that, we lawyers just do the best we can to win. After making sure the original advice is documented

Of course, we are all operating on limited facts - we don't even know for sure what the termination letter says, what the grievance says, or what options the Kings had for trades, etc.

[Resolute 14]

Originally Posted by GioforPM

Did the League agree? I missed that.

Anyway, I don't think they were close to a trade at any point. Plus, they already had a pretty disgruntled player (who will not be on the NHL roster - you can bank on that).

The cap hit is the biggest risk going forward, but are they over now with his salary or just really close? Anyway, I thought that the cap only applied during the season anyway - you can go over as long as you fix it by the start of the regular season. And then I think they can buy him out.

The league signed off on the termination almost immediately.

Unless it was dropped in the 2013 CBA - and I see no reason why it was - teams can only exceed the cap by 10% during the off-season. They have to be compliant by opening day.

[Locke]

Originally Posted by GioforPM

Did the League agree? I missed that.

Anyway, I don't think they were close to a trade at any point. Plus, they already had a pretty disgruntled player (who will not be on the NHL roster - you can bank on that).

The cap hit is the biggest risk going forward, but are they over now with his salary or just really close? Anyway, I thought that the cap only applied during the season anyway - you can go over as long as you fix it by the start of the regular season. And then I think they can buy him out.

The League did agree, but I'm talking about if the Termination is grieved and the decision reversed.

Secondly, Lombardi acknowledged that they were close on 2 potential trades at the draft that he had to cancel because he learned of whatever Richards did.

And lastly, you are allowed to exceed the cap in the summer but only by 5% I think. Something like that, I may have the numbers wrong, and the Kings are basically right at it.

[CorsiHockeyLeague]

Originally Posted by Phanuthier

I'm not a lawyer, but I can't imagine doing something that has pretty much no chance of succeeding (and not doing the proper DD) just cause. I'm curious, as a lawyer who handles multi-million dollar cases like this, do they often try for these lottery ticket wins? I doubt it, but I'm not a lawyer that works on these types of big tickets.

A lottery ticket implicitly assumes that the amount you're paying is dwarfed by the astronomical odds against winning. If you had a 1/1000 chance of winning a billion dollars, and it's only going to cost you, say, $50,000 to take that chance, you should take it, long odds or no. The high risk is balanced out by the low downside and high upside.

Different companies have different approaches. Remember, 95+% of disputes settle. Usually there are business relationships tied up in these things as well, and often you're still going to have to deal with your counterparty going forward, so often this sort of tactic is used for leverage. There's also almost no such thing as a "sure loser" - crazy positions sometimes succeed even when you yourself think "we're completely screwed here". This is especially true in arbitrations; even if one party ends up winning arbitrators are notorious for trying to throw the losing side a bone.

Doesn't mean they didn't do their due diligence. I mean, the Kings do have the league on their side and we may not be privy to additional facts. From where we sit it looks fairly absurd, though, I agree.

[GioforPM]

Originally Posted by Resolute 14

The league signed off on the termination almost immediately.

Unless it was dropped in the 2013 CBA - and I see no reason why it was - teams can only exceed the cap by 10% during the off-season. They have to be compliant by opening day.

I assume the Kings were cap-compliant, or close enough, prior to the termination. So they will only go over if they choose to run that risk.

The fact that the league signed off is pretty helpful to the Kings' case I think. Not only is Lombardi legally trained, but so is Bettman (and he actually practiced both as outside counsel and in-house with the NBA). Add to that the experienced lawyers the NHL employs, and you have to think a number of eyes have looked at the issue.

[GioforPM]

If this is successful, my old law firm (which did the Flames' work and probably still does) may be asked to follow Mason Raymond around. He might be advised to ensure no Flames staff ever packs his bags.

The foregoing is a joke only.