This post is essentially the conclusion to a post from nearly two years ago, dated July 22nd 2012. That post was itself a follow-up to this post, published three days prior. The two posts combined to document an issue, or was at the time a potential issue, of a mistake in a contract.
Sitting in the crowd at the 2012 Las Vegas Summer League, I was talking to someone about the market value of power forwards today. The discussion followed a fairly predictable route, and before long we got to talking about Zach Randolph, who in April 2011 signed an extension with Memphis that was to keep him with the team through 2015. Specifically, we were wondering how much he was due to get paid.
In accordance with the universally held but entirely unspoken rule whereby no-one in, around, covering or even vaguely interested in the NBA is any good with facts without a computer in their hand, I could not remember how much his extension was for. (Trade secret there. To a man, they/we have nothing.) So I pulled out my mid-90’s notebook and had a look for the specifics of Randolph’s deal. It was there and then that I noticed for the first time a problem with Randolph’s contract, an error which I, and apparently everyone else involved, had not noticed in the fifteen months prior.
Randolph’s extension called for base compensation of $17,800,000 in 2013/14, and $16,500,000 in 2014/15. (The contract also contains a ream of bonuses that make it deviate from those exact figures, yet they change not the general principles to be espoused here.) The 2014/15 is a player option season.
This all looks like standard enough fare. However, a piece of CBA minutiae states that the salary in a player or team option year cannot be lower than the salary in the previous season. [Larry Coon’s CBA FAQ question 58, near the end; actual CBA, Article XII, various.] Randolph’s deal, then, was set to flout this rule. And yet it had long since been signed, sealed and accepted by all parties – Randolph’s representatives, the Grizzlies, and the league itself (who have to approve all new contracts).
Given that it is unlike the league to make a mistake, I assumed I had. I assumed the information I had, as concrete as it normally is, was wrong in this instance. So I checked, asked around, called in favours from much more important people that I can never repay. Those folks however confirmed not only the figures list, but also the fact that they could not see how it happened. Which was both reassuring and perturbing at the same time.
Faced with a bit of an existential crisis – I was there to try and network for future employment opportunities, after all, and writing about a league mistake probably wasn’t going to help with that – I asked others for advice on what to do, on whether to run the story or not. I was advised to do so, reminded in the process that the whistleblower isn’t the one who caused the problem. So I did.
And then about 45 minutes after I did so, I was politely asked not to write it. The league were embarrassed by their error and did not want attention drawn to it. Which I had just done.
(Sorry about that.)
A bit deflated, I resolved to let the issue drop. Then, a couple of days later, I figured it would at least be prudent to double check and see whether the same mistake had ever happened again. Lo and behold, it also happened in the 2012 offseason, about a week beforehand, with the contract of Tim Duncan. His three year, $30 million deal was structured so that, rather than paying $10 million flat for three years, it would go down a bit in year one ($9,638,554), up a bit in year two ($10,361,446), and then finish with $10 million flat in year three. As with Randolph, that third year is a player option; as with Randolph, it seemed as though it had a lower salary than the year preceding it. And as with Randolph, that is not supposed to be allowed.
As before, this very piece of information could have been wrong. As ever, I checked it. It again got confirmed by people much more connected and informed than I. So one of two things happened – either we all got identical duff information (which, considering their ability to take it to the top, seemed unlikely), or the same mistake had indeed happened again. So I wrote the addendum post to mention that Duncan was in the same situation. And then I waited for some word on what resolution, if any, there would be to this situation.
Twenty three months later, that word is finally here. It now appears – and once again, has been confirmed by multiple parties – that Duncan’s 2014/15 player option has been modified so that it no longer contains a salary lower than that of the previous season. Specifically, it has been made to match it – Duncan’s player option, should he exercise it, now calls for a $10,361,446 salary as opposed to $10,000,000. And so now we perhaps have some finality on the outstanding issue, with the team effectively being billed for the error.
It ultimately is not that big of a deal. If you’re going to give $361,446 to any NBA player, you couldn’t pick a better one than Tim Duncan, and all NBA franchises, even those on smaller budgets than most, screw up multi-million dollar deals all the time. $361,446 one way or the other is not a deal breaker. It is nonetheless a bookkeeping point from the website that specialises in them. If we’re going to do minutiae, we might as well do it comprehensively.
It also, however, raises further questions. So far as can be ascertained – and again, efforts have been taken to confirm any available figures – Randolph’s player option season has to date not been modified in this way. As of this moment, his player option season still calls for the $16.5 million base salary, plus an unknown amount in bonuses on top. This comes in spite of that not supposed to be permissible, and the highly synonymous Duncan situation being resolved by modifying the amount of the 2014/15 salary.
Duncan’s situation is here labelled “highly synonymous” and not “symmetrical” because of one key difference. Randolph’s deal was signed in the latter days of the 2005 CBA, whilst Duncan’s was signed under the 2011 one. This is mentioned not because it is definitely a factor, but because it might be. And this is only a hypothetical. As best I can ascertain, there is nothing different in the language between the 2005 and 2011 CBAs with respect to this matter that would either change the nature of the violated provision or affect the league’s ability to remedy it. However, this might just mean I cannot see it, or (as is often the case as an outsider) I am unaware of what procedural matters, be they codified or merely customary, dictate in this situation.
Maybe the date of signing does matter, and that is why Randolph’s contract has not also been modified to match. Or maybe it is simply because no relevant party has noticed the problem yet. The former seems far more likely, but the reasons as to why it might be the case are not known. What is known is that Duncan seems to have gotten a pay rise. And that not only concludes a 23 month wait for at least one individual with bizarre hobbies, but also creates yet more questions. So begins another wait to have those ones answered too.
Maybe we can convince them both to opt out and make the whole thing go away.