Lately there's been many posts in the ACGM regarding that teams would buy bad contracts from other teams and use the CBO for that said contract. This happens particularily with teams that don't have a bad contract to buyout themselves, such as TOR.

As an example, it goes like this: NYI trades Johnny Boychuk's bad contract to TOR with a compensation, such as a draft pick, in order to get rid of that contract as they'd rather buyout Andrew Ladd's contract. Then the Leafs use their CBO to buyout Johnny Boychuk because they don't have anyone in their team to use the CBO for.

Isn't this just cap circumvention? The only reason NHL would allow CBOs is to help teams out in the cap crunch due to the unforeseen circumstances. Why should the teams not in a pickle get the prize from the struggle of other teams? Why would the NHL allow this? They were already a bit salty with how WSH dealt with Orpik couple of years ago, and this would massively exceed it in terms of cap circumventing.

If you ask me, should the CBOs become allowed, it should only be allowed to use on players that are in respective team's roster after the deadline and have played at least 1 game for the said team.

What do you think?

I’m on the opposite side. Why should two dozen teams get an unexpected boon that erases an advantage half a dozen other teams had legitimately achieved?

I’ve had this discussion with a knowledgeable colleague whose opinion I greatly respect. The question turns on the issue of “fairness.” There are six teams (Anaheim, Boston, Carolina, Colorado, Los Angeles*, Toronto) who have successfully negotiated the cap challenge and have no awful contracts to unload. My position is that fairness dictates offering the same value to every team; therefore, these teams (and anyone else who chooses to do so) should be allowed to buy out the contract of any player who is on their roster on July 14 (or whatever other cut-off date you choose). My esteemed friend says “fairness” means having all teams play by the same rules. That would be fine if all teams started at the same point, but they don’t.

Let me ask you this: suppose the League decreed that all teams would get TWO “compliance buy-outs.” Doesn’t the inequity of this become obvious? Such a rule would actually benefit only a handful of teams – maybe 5 at the most. The fact that the other 26 teams have a theoretical option that they won’t really be able to exercise doesn’t make this “fair.”

*The Kings present another issue -- what about contracts that were terminated (Kovalchuk)?

I understand this viewpoint, and I gotta admit there's some sense to it.

Regardless, this compliance buyout is still a buyout, namely that teams must pay to the player to get rid of its contract. This way it just doesn't effect the cap.

However, my viewpoint regarding the issue is that this potential buyout is a way to cope for the teams in a pickle due to unforeseen circumstances, and the circumstance is the penalty itself. It's natural that some teams get hurt by it more than others, and it feels more of a punishment for the teams not in that pickle, but it's not meant to be one, Every team gets the same way to cope with it. If the team has done well enough financially and don't have to get rid of anyone, they save some actual money in there. They don't have to pay anything to anyone.

Two buyouts should be considered only if the cap lowers significantly (more than $4M or so) - however as far as we know it that is not going to be the case.

My stance is the same, as a way to cope with the current situation teams should be let to buyout one of their players that have played at least 1 game during the said season and the players has been part of the roster after the deadline. Otherwise it becomes cap circumvention, which is already somewhat forbidden by the rules. No one should be able to abuse the bad situation some other teams are in, as far as the issue of "fairness" in concerned.

As for the terminated contracts, well the player isn't anymore part of that team, therefore there's nothing to buyout. I'm not exactly sure what the money difference is between an actual buyout and the cap penalty, but I don't think it's a significant one.

But the Kings have a $6.25 million cap hit from it. Why does Vancouver get to wipe $6 million off the books for Loui Eriksson but Los Angeles doesn't get to erase Ilya Kovalchuk?

{I'm going to reply to the rest of your response separately. I don't feel as strongly about Kovi as I do about the CBO.}

I'd be fine with buying out terminated contracts, but the thing that is going to be an issue is the amount to be paid. What amount should be paid to Kovalchuk as there's not a determined buyout amount.

With Eriksson there's not that issue. The amount to pay to him is clear.

What are the "unforeseen circumstances"? That the cap didn't rise as expected? I'm not belittling the awfulness of the pandemic, just pointing out that the cause of an action shouldn't be confused with the rectification of it. Okay, so revenues weren't as expected. How does that justify "hurting some teams more than others"? The idea that "every team gets the same way to cope with it" doesn't change the fact that some teams don't have that "way." And the money those teams are "saving" is money that they've already saved.



I was just using the two-CBO idea to show how unfair giving some teams an advantage is. Why not just say Tampa's cap ceiling should be $10 million more than Boston's?



I know that's your stance. Why is it an assumption?

By definition, a "compliance buyout" is cap circumvention.

Why is it "abuse" to exploit the "bad situation" some teams are in as a result of giving players bad contracts? Are you going to say that Los Angeles can't make an offer sheet for Mikhail Sergachev that Tampa can't afford to match is "abuse"?

Kovalchuk has to be paid the full amount, unlike Eriksson.

I refer this whole situation regarding the virus and what has happened since as the unforeseen circumstances. The situation has hurt the whole sport, not just some of the teams. I'm open to hear some ideas regarding the situation at hand and how to solve, but I'm not sold this CBO cap circumventing is it. All teams are given the same options and rules, it's in their power to use it however they like.

I don't get the point of that TB comment. The advantage is same for all of the teams, and as said it previously, they can use it however they like as long as it follows the rules. I don't see it being an advantage to TB (or any other team as a matter of fact) per se, because they lose something with the contract, and that is the player. They're forbidden to sign them back after the buyout. TB is a bad example to put here because their biggest contracts are players that are actually somewhat close to being worth the amount they're paid for (Gourde or Johnson for example), but they need to get rid of the asset for no compensation, and that can be very much considered as a penalty for them as well.

The major difference between CBO and an offer sheet is that other team would only lose the player they can't afford, but in a buyout they lose the player and some money as well. I don't think these two are very comparable ways of dealing with the cap. Also in an offer sheet situation a player is the final decision maker on whether he'd accept the contract of the other team, but in a buyout situation it's not like player's opinion is going to matter much

My stance is that all of the things happening here follow the rules set by the league. What I don't know is the way things regarding the compliancr buyout is dealt, but I assume that NHL won't allow this, because it doesn't really follow their line regarding cap circumvention (which btw offer sheeting players does).

Yeah as of now, but what I meant was that there's no determined amount to pay for buying out a terminated contract.

If Kovy was 35+ when the contract was bought out, the full amount is a norm.

"They can use it however they like" is the same contention that my friend makes, but it's a circular fallacy. Giving away 100 gallons of gas to every citizen is not a benefit to someone who doesn't own a car. The fact that each team might "lose" a player doesn't address the relevant issue: does giving an opportunity (i.e., an intangible thing) that is theoretically a benefit to all teams but in actual fact a benefit to only some teams equitable? Fairness demands that changing the rules should not change the positions of teams from the relationship they were in prior to the change. You're focusing on the player-team relationship when you should be thinking about the team-vs-team relationship. Tampa Bay is the best possible example of the inequity of disallowing trade-and-buyout because their primary competitor is Boston. Consider the relative positions of the two teams at this moment. Boston has plenty of cap space and can sign a $6 million or more AAV free agent; Tampa cannot and will have trouble signing all of their RFA's this off-season. Now consider their relative positions after the magic wand has been waived and Boston has been precluded from improving their position while Tampa hasn't: Tampa can now either sign a big free agent or keep ALL of their RFA's -- two things that were foreclosed previously.

The bottom line is that you can't bestow intangible benefits with legislation; the benefit must be tangible, i.e., empirically measurable so as to confirm that its effect is the same for all. The determination isn't applicability (whether all teams might use it) but benefit (something all teams can and will use).

Honestly the fairest possible way to solve is this not give teams CBOs. But considering the cap issues that is not realistic.

I get the logic behind what you say, and actually I can think of an example of that as a real life situation. This works like getting a speeding ticket here in Finland. Let's think of a situation where a semi poor man, who's monthly income is around 2k euros gets a speeding ticket, it will cost him around 200€. But if a rich man does the same crime, the amount he has to pay is significantly higher, because the way people are fined here is progressive and gets reflected to your income, meaning that the fine should effect the lives of the people in same manner. For example, here in Finland Rasmus Ristolainen got a 120 000€ ($130k) fine for speeding - a crime a normal person should pay around 200-300€ for due to his income being much higher.

From what I've gathered, your point follows this logic as well, as the penalty should have an equal effect on each team.

However, in sports this is almost impossible to execute fairly, because the teams are never in the same standing point. All 31 teams are in different situations, therefore it's just natural that the penalty will effect teams differently.

I'm not surprised about you not being happy about this since your teams (if I recall you were ANA and LA fan) aren't exactly in the best position, but if there were a better options but screwing with the contract stability and cap circumventing, I'd like to hear about it.

What a great example! And thanks for being able to see my side of the argument. As you note, I don't really have a horse in this race since the Ducks and Kings will almost certainly be on the sidelines (Backes is owed only $2.5 million in actual cash and there's NO chance the Kings buy Quick out), but I approach this from an academic perspective.

Given the incredible sudden and unexpected loss of revenue due to the virus and intrinsic value on top of that, the only fair thing to do is give the teams a CBO.

Not to steer away from the interesting discussion happening here but earlier this week Elliott Friedman reported that the owners are not happy about the idea of any type of buyouts.

The reasoning is simple. No revenues in...and with buyouts, it's like handing out free money. I don't know any smart business person handing out free money.

Right now salary rollbacks (possibly higher than expected) are more realistic than CBOs.

What do you guys think of this?

@OldNYIfan, @Trickster , @mhockey91, @Jack_, @Tansor, @Trevorchef

I don't see how a unilateral salary rollback (by the owners) is legal. If a player suddenly decides he's worth more than his contractual $2 million and he won't play unless the owner gives him $3 million, the owner can mail him a swimsuit and say Have a nice vacation. Unless this is in the CBA, I don't think it has a realistic chance in Hell of being accepted by the players.

Add @palhal and @AFOX10900 to your list.

Doesn't the NHLPA have to consider the immediate and long-term implications of rejecting a salary rollback? What I mean by this is...well let's assume for a second sports are allowed back into action without fans for the reminder of whatever season they decided on...let's also take into account that health officials are saying it will take 18 months to 2 years for a COVID-19 vaccine, that means the next season starts without fans too.. Obviously things need to be negiotated but how the players just reject the idea of rollbacks, I don't know how that's going fly in society in general.

I see as across the board salary reductions. Gotta believe players will vote that way also. The cap is based on revenue.
IMO the 21/22 cap will be even lower than the upcoming 20/21 cap. That's I have doubt if the next season will even be a full schedule, and the arenas aren't be anywhere close to full.

I'm fully expecting no fans at the start of next season and it could go on longer without a vaccine for this virus.

I think that it is too early to make predictions on this kind of thing. A lot can change between now and whenever that time comes.

Any potential buyout is an opportunity for a team to correct a mistake or to help get their cap in line in the event of a rollback or flat cap situation. There is no rule that says it has to be used.

All contracts were rolled back 24% for the 05-06 season following the season-long shutdown, so there is precedent for it.

Wow! Thanks!!

@palhal @Jamiepo @justaBoss @LeafsFanForSomeReason @Ajp_18 @TanSor

P.S. First time I've ever been wrong . . . today

I dont see CBOs happening.
At time when revnue is disappearing, the owners will not agree to it.
It is not realistic, not eve a little.

Salary reductions/rollbacks is what I see coming but like @palhal and you have said... it will need to be negotiated out.


With no salary reductions/rollbacks, the cap should approximately 66 million for the next season.
Trouble with going this direction is, the cap the year after will even lower then.


CBOs are purely fantasy and people should stop assuming they will happen.

I'm confused by my mention here.

I thought you'd be interested in this subject because I recalled having some discussions with you about future financials and I voiced an opinion which DoctorBreakfast has now seriously weakened. If I'm mistaken, put it down to age.