Golden Knights need golden ticket

The NHL’s collective bargaining agreement explains the complex process the new team must endure as it attempts to be competitive from its inaugural season.

Las Vegas is about to have a professional hockey team and that hockey team will need players.  The National Hockey League (NHL) commissioner Gary Bettman announced in June 2016, that the league would be granting an expansion franchise to the city of Las Vegas, bringing the total of NHL teams to 31.  The Board of Governors met soon afterward and voted unanimously to approve the expansion.

The only thing left do is, find some hockey players.

This will be the first time the NHL has expanded its team base since the Columbus Blue Jackets and Minnesota Wild were added to the league for the 2000-2001 season.  This expansion also marks the first time one of the four major professional sports leagues (Major League Baseball, the National Football League, the National Basketball Association, and the NHL) will have a team that calls Las Vegas its home.  Bill Foley, billionaire businessman and principal owner of the new Vegas Golden Knights, led the charge for this expansion and has expressed his optimism towards the future of the franchise and Vegas as a hockey town.

Bill Foley will be dishing out $500 million for the league expansion fee which will be distributed equally among the 30 current NHL teams.  The new Las Vegas Golden Knights will be playing their home games in the T-Mobile arena, right on the Vegas Strip.  This arena can accommodate roughly 18,000 fans.  The new franchise has already sold over 13,000 season tickets.  The only thing left do is, find some hockey players.

With the goal of having this team be competitive at the outset, the NHL will be conducting an expansion draft process in June 2017.  This process will involve the Vegas Golden Knights franchise drafting 30 NHL players, selecting one player from each current team.  Additionally, the Golden Knights will be awarded picks in the NHL draft lottery and the NHL entry draft.

As odd as it may seem, this process of selecting currently rostered players from teams already in the league is not a new idea.  When the Houston Texans were awarded a franchise in the NFL back in 2002 a similar expansion draft took place, but there was no rule requiring a player be drafted from each team.  Similarly, the 2000-2001 NHL expansion had the Columbus Blue Jackets and the Minnesota Wild drafting currently rostered players.

The [collective bargaining agreement] does not set specific expansion draft rules.

The NHL can effectively have players currently under contract transferred to other teams through a draft process, having the drafting team, here the Vegas Knights, take over the transferred player’s contract.  This authority comes from the NHL’s collective bargaining agreement (CBA).  This CBA was entered into by the NHL and the National Hockey League Players’ Association (NHLPA) on February 15, 2013.  This contract dictates, among other things, the rules for player contracts, trades, revenue, and player movement.

Article 13 of the CBA governs player waivers and expansion drafts.  Little is said about expansion drafts, other than players drafted during the expansion process will be deemed “transferred” and will be paid moving expenses as well as $6,000.  Article 14 of the CBA states that the team receiving the transferred player will pay these transfer expenses.  The CBA does not set specific expansion draft rules.  Rather, the NHL released these rules in June 2016, relying on the authority given to them by the CBA.  These rules set out which players can be drafted, which players can be protected, which players must be protected, and the number of position specific players the expansion club must draft.

Specifically, the Vegas Golden Knights will be compelled to select at least 14 forwards, 9 defensemen, and 3 goalies.  The other four slots can be filled with either skaters or goalies.  While drafting, the Knights will also have to consider the current NHL salary cap, as they must select players with a combined expansion draft value that is at least 60% of the prior season’s salary cap.  The current salary cap upper limit is $73 million.

Drafting at least one player from each of the current 30 teams and obtaining real value on each of those picks will be nearly impossible.

Current NHL teams are not without protection, though.  Teams have two options for protecting their current players from being drafted.  The first option is to protect seven forwards, three defensemen, and one goalie.  The second option is to protect eight skaters (forwards or defensemen) and one goaltender.  There are some players that teams must protect, though, and will be counted towards their team’s protection limit.  Any player who currently has a “no movement” clause must be listed as a protected player.  A no movement clause in a contract guarantees that the player cannot be waived or demoted down to the minor leagues.  It follows that a no movement clause would also guarantee that a player cannot be moved to another team due to an expansion draft selection.  The NHL rules for the expansion draft do not expressly state this, but players with no-trade clauses are likely protected players as well.  It would make little sense to only provide compulsory protection for players with no-movement clauses and not to players with no-trade clauses as well.  The Fourth Period has provided a list with all players who have a no-trade or no-movement clause in their contracts for the 2016-2017 season.

All first and second year professional players and unsigned draft choices are also protected from the expansion draft.  These players, however, will not be counted against teams’ protections lists.  NHL teams must “expose” a certain number of players and make them available for the draft.  Teams must expose at least one defenseman, two forwards, and one goaltender that are under contract for the 2017-2018 year.  One rule requires that the new franchise select at least 20 players who are already under contract for the 2017-2018 season.  This limits the number of players who will be free agents following the 2016-2017 who can be drafted.  The rules do not state specifically, but it is assumed that this rule limits the number of upcoming free agents, restricted (RFA) or unrestricted (UFA), to ten.

The CBA defines an RFA as a player whose contract with a club has expired, but who is still subject to a right of refusal or draft choice compensation in favor of his prior club.  An UFA, on the other hand, is a player who has either never signed a standard player contract or whose contract has expired and who is not subject to any exclusive negotiating rights by their former team.  Another rule states that the Vegas Golden Knights will not be able to “buy out” any players’ contracts until the summer following the team’s first season.  That would be the summer of 2018.  In previous expansion drafts, it was commonplace for a team to draft a player from a team knowing they would simply buy that player’s contract out and let them go without placing them on a roster.  This “draft and discard” method allowed expansion teams to optimize the value of their draft.

Drafting and discarding would be an effective practice in this year’s expansion draft if not for the ‘no buy-out’ language in this year’s rules.  Drafting at least one player from each of the current 30 teams and obtaining real value on each of those picks will be nearly impossible.  Because of that, it would be wise to “punt” or draft a player with a contract which would barely dent the team’s spending.  Being able to simply buy out that player’s contract means the team could then focus their other picks on players who the team believes could see considerable playing time and perform at a high level.  The no-buy-out rule for this year’s expansion draft effectively eliminates the draft and discard strategy though.  Rather than use picks for the purpose of punting, every selection in the June draft is going to have to count.  With the rules the NHL has put into place governing the expansion draft, it will be interesting to see just how competitive of a roster the Knights can put together.

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About Blake Drewry (14 Articles)
Blake Drewry is a third year law student and serves as an Associate Editor for the Campbell Law Observer. Originally from Courtland, Virginia, Blake received his undergraduate degree from East Carolina University where he majored in Political Science and Philosophy. His legal interests include local government law, land use and zoning law, and sports law. The summer after his 1L year, he worked for the General Counsel at the North Carolina Department of Agriculture. This past summer he worked at the Federal Public Defender’s Office for the Eastern District of North Carolina.