• It’s like waiting for your parents to get up on Christmas. If it was 1929 and your parents were heavily invested in equities.

    by Tyler Dellow • July 1, 2011 • Post, Uncategorized • 19 Comments

    So the free agent class kind of sucks this year. All the more reason for some enterprising GM who has a bucket of cap space and desperately needs a star for his team to offer a one year $12MM contract to Drew Doughty, consisting of $6MM in salary and $6MM in signing bonus, plus you only need to qualify him at $6MM for next year. Regrettably, this won’t happen but it’s nuts that it won’t – if you’re a mid-level team without much fear of retribution because you don’t have any elite young talent, as well as some cap space, it’s a great move.

    The Maple Leafs, by the way, have a ton of cap room and a desperate need for stars, of which there are none available as UFA. It’s a shame for their fans that Brian Burke has some sort of bizarre moral objection to offer sheets.

    * * *

    There’s a sort of running joke in Jay and Silent Bob Strike Back about Ben Affleck’s habit of killing prostitutes. It’s widely known amongst the movie set people in the flick and, whenever a dead prostitute turns up, people react with disgust. There’s an important lesson there: if you make a habit of doing something, people will suspect the worst when that situation arises.

    In a completely unrelated story, the LA Kings say that Colin Fraser had an injury that the Oilers failed to disclose. This may sound familiar to people who can remember last week, when the Kings scotched the Brule and a pick trade after it appeared to have been reported to the NHL because it turns out that Brule has some health problems that prevented the Kings from buying out that the Oilers had failed to disclose.

    Those with even longer memories will recall that diagnosing injuries seems to be a real weak spot for the Oilers’ diagnostic staff. It’s as if the policy is “Don’t ask, don’t tell” when it comes to this stuff. Jarret Stoll played with a concussion. Souray complained that they were pressuring him to play. There are a lot of suspicions about Ales Hemsky having played with a concussion. Khabibulin’s medical problems stunned them. They thought Brule was healthy and apparently had to be told otherwise.

    Tambo’s response to all of this was to whine about the Kings releasing personal information. That’s entirely beside the point. Whether the Kings are right or wrong in doing so, here’s another case of an Oiler about whom there are contentious issues in respect of his health. There’s enough of a pattern here that I’m not sure why you’d extend Tambellini and the Oilers the benefit of the doubt. We know that they’ve missed injuries in the past and that players have felt pressured to return before they were medically cleared to do so. Why is that not the case this time?

    Just on the legal point – I understand a lot of people are hanging their hat on the supposed “as is, where is” terms of the deal. I don’t see how you can do that. If the terms of the deal required the Oilers to disclose what’s wrong with him and the Kings then agreed “as is, where is” and the Oilers then failed to make full disclosure, whether through ineptitude (most likely) or malfeasance…well, in a real court, the Kings might have an argument. Nobody knows what the NHL rules are but Lombardi’s complaints don’t seem so outlandish to me. Tambellini’s confident assertion that the Kings will not receive additional compensation does not fill me with confidence, as he’s a Neville Chamberlain class leader.

    * * *

    I held off on writing something about the Oilers buying out Sheldon Souray until it actually happened but now that it seems that it’s about too, I’ll make my comment. If you think back to last summer and assume that Souray was never going to wear the Oilers’ jersey again, they had XX ways to get rid of him. They could send him to the minors or otherwise tell him not to come, which would have cost them $9MM over two years. They could have bought him out at the time, which would cost them about $6.03MM over four years. They could have sent him down and then put him on recall waivers and, if someone had taken him, it would have cost them $4.5MM.

    In what looked like a poor bet at the time, they elected to send him down, knowing that they couldn’t bring him up without exposing to recall waivers. This only made sense if they intended to try and move him again in the summer. I tried to give Tambo the benefit of the doubt there, even though I thought the risk was poor, and made the generous assumption that he was hoping to try and move Souray this summer, in the hopes of getting something for the $4.5MM that it would cost to keep him in the minors all year. When Tambo called Souray up late last season and exposed him to recall waivers, I became convinced that I was probably too generous in assuming that there might have been a plan, stupid as it seemed to me.

    If you assume that Souray would have been claimed on recall waivers last fall – and I suspect that the chances would have been good at the time, given that he only would have cost $4.5MM over two years to the team acquiring him, which is cheap for a guy who they would have assumed could play on the number one PP, do some penalty killing and take a top four shift – the cost to the Oilers of Tambo’s indecision/dumb bet is $3.015MM – by keeping him all year, they paid him $4.5MM in salary and then another $3.015MM to buy out this year of his contract. If you figure he wouldn’t have been picked up at half price, the failure to buy him out last year cost them just under $1.5MM – they pay him $7.515MM instead of paying $6.03MM for a buyout.

    Either way, when you factor in the cost of JDD, the cost to the Oilers of an indecisive GM who constantly appears to be over his head was somewhere between $2.5MM and $4.5MM last year. That’s a hell of a lot of dough for an organization that appears as if it could benefit from redeploying some of its resources to the medical front.

    About Tyler Dellow

    19 Responses to It’s like waiting for your parents to get up on Christmas. If it was 1929 and your parents were heavily invested in equities.

    1. Woodguy
      July 1, 2011 at

      Re: Legal point on Fraser

      I tend to agree on the “as is” part. I thought the other way (agreeing with Tambellini), then changed my mind.

      If the Oilers say “as is”, and indicate the “is” = Broken foot bone that is healing and he can resume workouts right away, and the LA Doctors say the “is” is actually a bone that isn’t healing well and needs surgery on a bone cyst, then the Oiler’s “is” is not as they say.

      Willis made a good comment saying this might just be a difference of opinion of two different doctors, but why are the Oiler doctors/medical staff always erring on the side of “get a stitch and get back out there!”?

    2. Coach Pb
      July 1, 2011 at

      Staios also played with a concussion.

    3. Tyler Dellow
      July 1, 2011 at

      Yeah, it’s a question of representations WG. If you say “as is” and make no representations as to his health, it’s different than saying “as is” and saying “he’s healthy and able to start playing in the fall.”

    4. The Other John
      July 1, 2011 at

      Completely disagree on the “As is, where is”. You could advertise an 1800 sq ft house AIWI and if it was 1500 sq ft. Think you would lose that lawsuit. It is the equivalent of there are no reps and warranties and you get what you see

      Did not say I believe Oilers traded Fraser on an AIWI basis. But if they did, legally they walk.

      So if someone mentions AIWI in selling you a used car, grab your wallet and start running

    5. Tyler Dellow
      July 1, 2011 at

      It is the equivalent of there are no reps and warranties and you get what you see

      I don’t think that this is necessarily true, particularly here where the Oilers appear to have made some sort of representation as to his health. I haven’t researched the point but I do have a law degree. Do you have a legal background or any practical experience on which to base your complete disagreement?

    6. The Other John
      July 1, 2011 at

      Yes.

    7. Saj
      July 1, 2011 at

      Re: Souray

      Maybe you saw the probabilities accurately at the time the decision to send him down was made last year. But just because things happened a certain way doesn’t mean they were pre-destined to. There were lots of possibilities that could have occurred, even though only one course of events can take place. It’s entirely possible that Tambo’s “plan” was that Souray would respond to the demotion by tearing up the minors, thus making him more valuable for a trade right now. That errant decision (in retrospect) did cost a couple mill, but has to be compared to what could have happened had we been able to get something for him if things had gone differently.

    8. Dan
      July 1, 2011 at

      I agree with Tyler about the “as is where is” issue. I’m not sure about NHL rules are or where a lawsuit over the trade would take place, but in NY (site of the NHL head offices) one is guilty of “fraud in the inducement” if you knowingly make false claims to induce somebody else to enter into a contract.

      A defense to fraud in the inducement is that the false claims were merely “puffery”, which is “is an argument that no reasonable person would believe some sales promotion to be
      literally true.” Given the Oiler’s documented history of rushing players back before they are healthy, Tambo’s claims that Fraser was healthy may fall into this category.

    9. Tyler Dellow
      July 1, 2011 at

      Saj –

      I agree on the pre-destination. At the same time, once the Oilers sent him down, they were committed to paying him at least $4.5MM. My complaint is that it was a dumb bet that went sour. Same old, same old.

    10. Vic Ferrari
      July 1, 2011 at

      Souray to DAL. One year @ $1.6 mio being reported.

      That’s a terrific deal for Nieuwendyk.

    11. July 1, 2011 at

      Souray to DAL. One year @ $1.6 mio being reported.

      That’s a terrific deal for Nieuwendyk.

      Damn. I was really wanting my Red Wings to get him on a deal of something like 1yr/2.5M or maybe 2yr/4M. I bet Souray tears it up to give a big middle finger to the Oilers as an organization, on his way to another big contract.

    12. July 2, 2011 at

      Either way, when you factor in the cost of JDD, the cost to the Oilers of an indecisive GM who constantly appears to be over his head was somewhere between $2.5MM and $4.5MM last year. That’s a hell of a lot of dough for an organization that appears as if it could benefit from redeploying some of its resources to the medical front.

      Not to mention a team that’s allegedly losing money and needs a new arena (from the taxpayers, natch) to stem the tide.

      Sneaky fuckers.

    13. Bruce McCurdy
      July 2, 2011 at

      the failure to buy him out last year cost them just under $1.5MM – they pay him $7.515MM instead of paying $6.03MM for a buyout.

      In simple fractions the Oil paid him 5/6 of his remaining contract instead of 4/6, because they exercised the 2/3 buyout in just the second of the two years. Your numbers look mighty close to 5:4 to me.

      The other point I thought you would bring up has to do with escrow, or the lack thereof in the minors. As I understand it, Oilers would’ve paid the face value on that contract, unlike what they would have paid him in the NHL. Don’t know the percentages or the dollars, but am certain they are non-trivial.

    14. Wan Ihite
      July 2, 2011 at

      I have to imagine that AIWI does not cover active deceit. If you sell someone a car AIWI and tell them that your mechanic says it works fine so long as you warm it up a few minutes, then they are paying you a price on the basis of that representation. If that isn’t true then you have defrauded them. If it turns out that the car just smells funny, or has a leak in the steering fluid which requires regular refills, and you never said anything about that in the sale, then THAT is caveat emptor. But if the bargain was for a working car and what you’ve sold them is the worlds least practical paper weight, that’s a fraudulent contract.

      Caveat reader: IANAL.

    15. Schitzo
      July 2, 2011 at

      In simple fractions the Oil paid him 5/6 of his remaining contract instead of 4/6, because they exercised the 2/3 buyout in just the second of the two years. Your numbers look mighty close to 5:4 to me.

      1/6 of nine million is 1.5 million.

      5/6 of nine million is 7.5 million.

      4/6 of nine million is 6.0 million.

    16. The Other John
      July 2, 2011 at

      Wan Iwhite

      I think the purpose of AIWI is to put you on notice that there are no representations connected to the item you are buying. Your example couples AIWI with an express warranty…….. I promise you XX. Courts HATE exclusion clauses with a passion but trying to couple express representation with AIWI defeats purpose of vendor telling you your sale contains no reps or warranties.

      Have seen no evidence that Fraser sold AIWI …… Because reasonable purchasers hearing AIWI grab their wallet and start running away

    17. Tach
      July 4, 2011 at

      If you are Drew Doughty, why would you sign the $6+6 million offer sheet when LA is probably looking at giving something in the 8 year $50 million range? He would be one Steve Downie elbow away from giving up $38 million – how the hell would that make sense?

    18. Hambone
      July 4, 2011 at

      Tyler,

      Re: Souray

      Far be it for me to be an apologist for Lowebellini, but I think that in order to be in its proper context, your critique should attempt to answer two questions:

      - Is the mistake made with regards to Souray’s situation an example of an exceptionally poor decision by NHL GM standards?

      - Does Tambellini make these kinds of mistakes more often than other GMs?

      I ask those questions because to point out that an individual makes mistakes isn’t really sufficient. Does he/she make them in patterns that suggest a lack of ability to meet the demands placed on them?

      I don’t follow any other NHL teams closely enough to know so I thought you might be able to add any insights.

    19. July 6, 2011 at

      Souray was Lowe’s mistake, and possibly even EIG’s mistake, given that his signing came on the heels of Katz’s initial pubic offering and promise to spend to the cap.

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