Conflicting reports about NHL CBA talks as beer sponsor brouha comes to a head

Montreal Canadiens owner Geoff Molson has plenty at stake in the NHL lockout: his team's finances and those of his family's brewing company, which is a major sponsor of the league. (Photo by Richard Wolowicz/Getty Images)

By Stu Hackel

CBA talks continued on Thursday afternoon somewhere in New York  -- not to be confused with John Lennon's fifth post-Beatles album Some Time in New York -- and Kevin Allen of USA Today tweeted on Wednesday that he was "at an undisclosed location covering NHL negotiations going on at a different undisclosed location. Feel sorry for those in known locations."

Regardless of where they're talking, reporters still have their sources feeding them information on what is being discussed and how things are going despite pledges by both sides to conduct this business in silence and not make the lead negotiators available for press briefings. Of course, those sources all have their own perspectives, if not their own agendas, so we get varying notions of what has transpired.

As we noted in our update of Tuesday's post, Helene Elliott of The Los Angeles Times was told by "people familiar with the nature of the talks but not authorized to speak publicly (that) progress had been made, but both sides declined to describe specifics of the sessions." But Sportsnet's Doug MacLean tweeted about the same bargaining session, "Hate to say this but just told by person in the know that yesterday was as close to a waste of time as you can get. Hope today is better."

That's why silence is preferable.

So it's uncertain what to make of leaks like this one provided to Michael Russo of The Minneapolis Star-Tribune who tweeted on Thursday morning, "To echo others, huge afternoon in nhl labor negotiations. Will either be traction or this can go south quickly. Wednesday didn't end well."

Maybe, maybe not, but they're back at it and will at least be on Friday as well, perhaps further into the weekend. And if a deal is to be reached, the path to it will probably go up and down for the foreseeable future -- unless one side decides the blow up the season. Elliott reported on Thursday that, "The sides have reached the stage of real negotiation instead of one side expecting the other to capitulate, and that the process will be slow as they test wills."

As best as we can figure out, much of the earlier discussions this week concerned revenue sharing, a very crucial topic we highlighted long ago but one that has been largely forgotten for a number of weeks amidst talk about the division of Hockey Related Revenue and each side's posturing about the lack of negotiations.

[UPDATE - Numerous sources say the NHLPA presented the NHL with new proposals on revenue sharing and on the sharing of Hockey Related Revenue which, taking into account the owners honoring existing contracts, will reach a 50-50 split in the third year of the deal. The NHL responded to the PA on these proposals but both NHLPA Executive Director Don Fehr and NHL Commissioner Gary Bettman declined to comment specifically after the Thursday meeting other than to say talks will continue on Friday. Indications are the owners will present a counter-proposal to the players' position -- you know, real negotiations for the first time. And the undisclosed location has been disclosed: the meetings have been at the offices of the law firm Proskauer Rose, which we discussed here. ]

The players contend that if their share of revenue is going to decline in order to help struggling franchises, the owners should have to participate more in that effort than they have in the past and they've proposed to do going forward. The NHL has redistributed about $150 million to poorer clubs and plans to raise that to around $190-$200 million. The players' proposed hiking that figure to $250 million, in part so the problem franchises don't have ongoing issues that cause the league to threaten yet another lockout when the CBA that is now being negotiated expires. Early on in this process, the NHLPA suggested the creation of an "Industry Growth Fund" to stabilize the game's economics, with $100 million annually dedicated to the assistance of the clubs in need and a team-by-team plan administered largely by the commissioner's office.

It's unknown if that idea is still part of the discussion, but wealthy owners have largely opposed enhanced revenue sharing. They contend that the business isn't large enough for them to give away bigger chunks of their income to assist their weaker brethren. The PA has examined the NHL's finances and doesn't agree.

Also being discussed is the ongoing critical issue of the league's "Make Whole" provision, designed to honor the existing player contracts. The first version that the NHL designed was unacceptable to the players, but the league says they have adjusted it to take into account those objections. The "Make Whole" was reportedly raised on Wednesday and supposedly will be part of Thursday's talks, as will revenue sharing.

Interestingly, as Jeff Klein of The New York Times reported, the NBA had to deal with this issue in settling its lockout and those owners "honored existing player contracts. The language in the new collective bargaining agreement guaranteed that salaries signed previously 'shall continue to be calculated in accordance with the salary cap rules that were in existence at the time the contract was entered into.'” The NHL often points to the NBA as the model for its new CBA, but perhaps it only likes the part of it that deals with that league's 50-50 revenue split, because the NBA's salary cap is far more flexible than the NHL's and pro basketball engages in a good deal more revenue sharing than the NHL.

The big brew-ha: In the absence of hard news coming out of the negotiations, one of the bigger stories this week had to do with NHL beer sponsor Molson Coors saying that it was feeling the pinch of the lockout due to a drop in sales.

"Whether it's people not actually physically going to the venues and consuming there, consuming in venues around the outlet before that, or indeed having NHL sort of parties at home, all of those occasions have disappeared off the map and you just can't replicate them," CEO Peter Swinburn told Canadian Press. adding that the drop is more evident north of the border than in the U.S. "It's a national sport, the whole of Canada is glued to it one way or another so there's no real regional difference at the moment that we can detect."

Swinburn said the drop in sales should be reflected in Molson Coors' fourth quarter performance and that the company will seek financial compensation from the league after the lockout ends, citing  the negative impact due to the lack of games. "There will be some redress for us as a result of this," he said. "I can't quantify that and I don't know because I don't know the scale of how long the lockout is going to last."

This is the first time that an NHL sponsor has publicly spoken in clear terms about the lockout's impact on its business and the league can't be terribly happy about it. Unsaid in all this is the fact that the Montreal Canadiens' ownership group is headed by the Molson family. In the various attempts, like this one, to figure out which owners have supported the lockout and which have been less enthusiastic, Geoff Molson's name has rarely been discussed.

Of course, the Canadiens are a big revenue club and may not be enamored with the NHLPA plan for the owners to share their wealth. But given this bit of news coming from his family's principal business, you have to wonder how they're really feeling at 1909 avenue des Canadiens-de-Montréal about the course negotiations have taken thus far.

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