The NHL announced on Monday night that it has fined the Devils $3 million for the team's initial 17-year, $102-million contract with Kovalchuk, which was rejected by the league for circumventing the salary cap.
Arbitrator Richard Bloch upheld that decision in August, and the Devils eventually reached an agreement with the Russian star on a reworked 15-year, $100-million deal that the league accepted after negotiating restrictions on future long-term deals with the NHL Players' Association.
In addition to the fine, the Devils will also have to forfeit a pair of draft picks. They will lose their third-round selection in 2011 and a first-round choice in one of the next four years. New Jersey will have the option to decide which year it will give up its first-round pick, and must inform the league by the day after the conclusion of the Stanley Cup finals of the year it intends to forfeit its pick.
The fine will not count against New Jersey's cap. That provision was agreed to in the settlement reached earlier this month by the NHL and the NHLPA after negotiating the acceptance of Kovalchuk's revised deal.
That's about the only good news for the Devils, who already are faced with needing to trim nearly $3 million from their payroll to get under the cap for the upcoming season, and that's with just 21 players currently on the roster.
New Jersey general manager Lou Lamoriello fired back at the league in a statement.
"We were today advised of the ruling by the Commissioner with respect to the Kovalchuk matter," said Lamoriello. "We disagree with the decision. We acted in good faith and did nothing wrong. We will have no further comment."
The Devils originally acquired Kovalchuk, along with defenseman Ansso Salmela and a second-round pick, from Atlanta late last year for forward Niclas Bergfors, defenseman Johnny Oduya, prospect Patrice Cormier and first- and second-round picks in 2010. They can now add two more picks and $103 million, plus whatever players they have to jettison to get under the cap, to the cost of retaining him.
