after a settlement was reached on friday between mike richards and the los angeles kings on the wrongful termination of his contract, eyebrows raised in front offices around the league.
By terminating richards’ contract for “material breach” on june 30 with five years and $22 million remaining, ignoring the ordinary-course buyout procedure in place, and then answering to an nhlpa grievance with a settlement, the kings may have opened up a can of worms for the nhl.
although exact figures have not yet leaked out, the kings are believed to be on the hook for less than what an ordinary buyout would’ve impacted their salary cap. Los angeles will continue to be penalized with a salary cap recapture penalty of $1.32 million until 2019-20, plus a smaller amount equal to what richards will receive in salary from the kings until the end of the 2030-31 season.
From a financial perspective, the kings do not have to pay out $22 million over five seasons and instead will now spread it out over 15 seasons. A normal buyout would have been 10 seasons.
but with the salary cap incrementally increasing over the next 15 seasons, that additional smaller number due to the richards settlement will likely have a negligible impact on the kings’ salary cap.
the question is: Will other nhl teams now attempt to divorce themselves from unpalatable contracts using a similar loophole?
A source told tsn hockey insider pierre lebrun that richards’ settlement includes “non-precedent” language so other teams in similar positions may not cite the richards case, though that may be common in many player-league settlements.