Kukla's Korner Hockey
by George Malik on 08/21/06 at 12:54 PM ET
"They all like to talk about democracy, the American way and then they shamelessly steal our best players. This is pure sports terrorism," said the Metallurg general director. "Don't forget, Malkin is a young kid, he is still very naive and it was easy for them to get into his head all that stuff about the American dream and how great the NHL is," he added. "The Pittsburgh owners are trying hard to sell the club, and the price would be totally different if they had Malkin. "But you can't just take our best players and expect to get away with it." "We've put so much effort, resources and money into Malkin's development as a player. He was our gold diamond, our prize possession. He had a contract with us, we were building the whole team around him and now he is gone," Velichkin said. "But don't think we'll just sit there and do nothing. We'll go to court to get what we believe is proper compensation."The drama goes from bad to worse when we hear Evgeni Malkin's stories of passport-stealing team officials and owners' strong-arm tactics which smack of mafia movie material:
Malkin fired his agents at Newport and went back to Brisson and Barry, who represented him for several years up until June. They barely had time to figure out their next course of action before Malkin and his parents were “invited” to a 9 p.m. meeting with team officials at a lakeside business center outside of Magnitogorsk.
That was on Aug. 6.
Team president Viktor Rashnikov started the meeting and, according to Malkin, expressed “his point of view” and the team’s interest in Malkin staying another year. But Malkin and his family said that they would not sign a new contract.
“I still wanted to play in the NHL this season,” Malkin said.
Malkin said Rashnikov stood up, thanked everyone and left.
But it wasn’t over.
Not even close.
Malkin and his family left the office and went outside where they were joined again by Velichkin and another team official who suggested they follow the Malkins home to continue “negotiations.”
“They didn’t want to give up,” Malkin said. “They hoped very much that the contract would be signed at that point at our house.”
By this time, Brisson and Barry, who knew the meeting was taking place, were getting concerned. They’d called the Malkin home at 11 p.m. and Malkin’s brother informed them that his family wasn’t home yet.
Later, McQueen, who was already working with Barry and Brisson, called the house and got Malkin’s mother, Natalia, on the phone. She whispered that she could not talk, and told them that Magnitogorsk officials were there in the home, talking to Malkin.
Malkin’s Russian advisor and ally of Brisson and Barry, Gennady Ushakov, was also there, but there was not much he could do to help. McQueen relayed to Natalia Malkin that her son had the legal right to get up and leave at any time. But although Malkin said he was never in physical danger, Velichkin was nonetheless pressuring the 20-year-old, preying on his feelings of loyalty to the only team he’d ever known, the town he grew up in and his country.
This continued from midnight until 2:30 a.m., Malkin said, until finally he couldn’t stand it anymore and gave in. He signed a one-year deal to stay in Russia even though his only wish was to go to the NHL and play for the Penguins.
He went to his bedroom in tears.
So what are we to make of all this drama?
Is the state of Russian Hockey in 2006 like that of Soviet Russia in 1986?
Yes and no. The answer’s complicated, and involves social, political, and economic theory, as well as a good deal of skepticism.
The Russian Hockey Federation and Metallurg Magnitogorsk care as much for Evgeni Malkin’s hopes and dreams as they care about the weather in Gimil, Manitoba.
This is about money and power, like every other conflict in this world, and the first culprit in play is the media.
Yes, it’s been 15 years since the Soviet Union fell, but Russian NHLers say they’ve been misquoted for a reason. While they most certainly let details slip which they should keep to themselves when nobody’s looking, this is the Russian sports media we’re talking about here.
Sport-Express’s Igor Larin makes Bruce Garrioch’s wildest rumours seem credible, Soviet Sport doesn’t hide behind a politically correct namesake, and Pravda still makes good kindling. Russian sports journalists still have a flair for the dramatic, as do their subjects. Reading about the Russian sports scene is difficult at best because elements of journalistic integrity or objectivity just don’t apply.
As such, the sports media tends to lend a sympathetic ear to Russian Superleague clubs. NHL’ers from the former Soviet republics are still called “Legionnaires,” and, at times, the level of resentment for and disgust at the NHL as an inferior hockey league and foreign plunderer of truly talented European players is ever-present. This is fueled in large part because the men who are in charge of the Russian Hockey Federation are by and large the same men who were in charge of the Russian Hockey Federation in 1986—Viktor Tikhonov is still a man of great influence—and as such, these gentlemen have neither recovered from their wounded collective pride when players were allowed to leave for the NHL, nor have they amended the ways which govern the RHF.
Gennady Velichkin didn’t have to go far to find a sympathetic ear, nor did Evgeni Malkin have to drum up his story to Sport-Express’s Slava Malamud.
At the same time, while the dramatics are Shakespearean, the details are accurate, for several reasons.
Vladislav Tretiak, the chairman of the Russian Hockey Federation, somehow managed to marshal a small-market coup. He and the old hard-liners who don’t want players to be paid a fair wage (in hockey terms, not real-world terms) jammed a $13-million hard salary cap (with an exemption for a franchise player) and stiff regulations upon foreign-born players down the throats of some of the wealthiest men in Russia. State-controlled industries and businesses were made public upon the dissolution of the Soviet Union by giving shares of ownership in companies to all Russian citizens, and certain well-heeled individuals took out loans of $10-30 million to buy those shares en masse, effectively purchasing multi-billion dollar interests for rubles on the dollar.
Avangard Omsk’s owner, Roman Abramovich, owns Chelsea in the British Premiership, and he recently sold his rights to Siberian oil and natural gas to Gazprom, the state-owned oil giant. The famous Ak Bars of Kazan are subsidized by TatNeft, the Republic of Tartarstan’s oil company, so they were able to support a $75 million payroll during the lockout while playing 25 home games in a 3,000-seat rink at $5 a seat. Metallurg Magnitogorsk’s owner, Viktor Rashnikov, owns the largest steel-making complex east of the Urals. As Detroiters know, Severstal OAO, the parent company of Severstal in Cherepovets, own Russia’s other biggest steel mill, as well as the former Rouge Steel plant in Detroit. Neftkhimik Nizhnekamsk’s ownership can trump all but Kazan as they have the rights to Russia’s iron ore and coal deposits.
The men who own the biggest Superleague clubs are oligarchs. They have tremendous economic and political influence because they control the country’s natural resources, and the Russian Federation’s restrictions upon their free-spending teams were seen as personal affronts to some of the most powerful men in the country. Whether smaller-market teams could keep up was and is immaterial—the big-market clubs are literally “big boys’ toys.”
Even before the salary cap was tabled, Metallurg had stated that they expected “tens of millions” in exchange for Malkin. The Superleague’s owners were glad to see the last IIHF transfer agreement expire because they wanted a return to the good old days, when NHL clubs had to pay outlandish bribes to access Russian superstars, and Malkin became their rallying cry against the NHL and International Ice Hockey Foundation. Even the threat of barring Russian-born players from participating in the 2007 World Championships—which will be held in Moscow and St. Petersburg, the latter of which is the hometown of Russian President Vladimir Putin—would not quiet their cries of protest, claiming that the evil NHL and Americans were robbing the poor, innocent Russians of their “national treasures.” After the cap, “Millions For Malkin” bumper stickers were probably visible on the big guns’ private jets.
Earlier this summer, rumours of Malkin’s departure rumbled across the Atlantic, and, obviously, Mr. Rashnikov and Metallurg wanted to make sure that Malkin could leave if and only if their demands were met.
Here’s where the mob comes in. When word of Rashnikov’s tactics slowly filtered back to North America, journalists almost inevitably played the “Russian Mafia” card. There’s no doubt that the mafia has its place in Russian businesses. The same gents who enforced the Communist Party’s edicts didn’t forget how to “convince” people how to play along, nor did they have a viable alternative to their previous lines of employment, so they provided a valuable service as a go-between when neither the government (whether Russia is an operating democracy depends on who you ask—there are democratic beliefs and ideals, but Russia is less democratically-ran than it was 15 years ago) nor big business could find a go-between.
They’re more like private contractors who happen to know the business of the wealthy so that they can provide their talents for a nominal cost. Every once in a while, a Russian official or oligarch will be followed to his dacha and will get the snot shot out of him when the mafia feels the need to remind everybody that they’re proficient at their jobs, but, by and large, the Russian mafia is just “there” when needed.
In Malkin’s case, the reason he was strong-armed is because no 20-year-old kid who happens to be a “national treasure” was going to be allowed to resist Metallurg Magnitogorsk’s General Manager, and when he did so, the owner stepped in. Sometimes kids need to be reminded that multi-billionaires’ polite offers are not up for negotiations or refusals, and nobody gives their two weeks’ notice to Viktor Rashnikov.
If that meant coming out to the kid’s home, waiting for daddy, mommy, and Evgeni to come home, and explaining the situation over and over until the kid put pen to paper, well, just call Mr. Rashnikov and Mr. Velichkin users of “psychological pressure.” Millions and millions of dollars were at stake, and, more importantly, Mr. Rashnikov’s pride was at stake.
As we all know, Evgeni Malkin decided that he wouldn’t be playing in the Pajulahti Cup in Tampere, Finland. He took his passport back, walked through customs, and walked out of the airport into a waiting car.
One can imagine the thoughts that went through Mr. Velichkin’s mind when the General Manager of Metallurg Magnitogorsk realized that his $20-million payoff—let’s not kid ourselves here, Metallurg was not going to settle for a paltry $2 million from a league that “steals players”—had disappeared into the night. “Sports terrorism” was probably the least of his concerns.
Malkin’s agents felt that bodyguards were necessary. When a billionaire’s plaything loses its “crown jewel,” using bodyguards are a safe bet. In the 90’s, Alexander Mogilny ran afoul of somebody, and he had to pay off mobsters to secure his family almost a decade after his defection, and Oleg Tverdovsky had to pay a significant sum when his family was threatened as well—which may explain why he decided to go back and play for Avangard Omsk for a few years before returning to the NHL.
Malkin knows his family isn’t necessarily safe:
“I was very much concerned about my family because I expected Mr. Velichkin to start making phone calls and be not quite polite with my family,” he said. “I was also worried that lawyers would start calling and contacting my family trying to get them to sign any kind of documents. Which has already happened. They received calls and were asked to sign papers.”
Viktor Rashnikov still wants his tens of millions. He’s suffered a wound to his pride, and he’s taken a hit for the Superleague’s biggest die-hards only a few months after the Russian Hockey Federation’s old guard effectively crippled his competitive advantage with a salary cap.
So, for now, this is going to court. First and foremost, the Superleague and the RHF—those relics most certainly don’t want to see the NHL “steal” a player like Malkin—will demand that the convenient loophole which allows players to give two weeks’ notice to their employers will be stomped out of Russian law. Concurrently, they’ll sue the Penguins, the NHL, Malkin, J.P. Barry, “Baghdad” Brisson and C.A.A., and whoever else had the gall to tick them off.
The fact that Moscow Dynamo couldn’t successfully sue the Capitals for Alexander Ovechkin won’t matter to them, despite the fact that it sets an important U.S. legal precedent. The Caps’ suit against Lada Togliatti for signing Alexander Semin to a deal during the lockout was tossed out of court as well, which might give you a tip that the United States’ justice system believes these suits are sports frivolity, not “sports terrorism.”
Mr. Velichkin already told the Russian media that he will go all the way to get Malkin back or a fair compensation from the NHL and Pittsburgh Penguins if Evgeni gets signed in North America but he wanted to hear what Malkin says first. After studying a Malkin’s interview published in Sport-Express on Saturday Mr. Velichkin explained the legal steps he will take against Malkin.
First, he will file required paperwork to the Russian Hockey Federation Arbitration with a request to disallow Malkin to play for any other professional club. In case of a positive result a copy of the decision will be forwarded to the Pittsburgh Penguins organization as well as the NHL and IIHF. Velichkin expects Malkin either to go back to Russia or we start negotiations with the Penguins about the contract buyout. If Pittsburgh does not do it we will sue them.
Malkin himself has been busy answering questions of several media outlets including Russia’s Sport-Express Daily. In an interview published on Monday when asked what would be the best ending of this unpleasant story for Malkin Evgeni answered: “I want Pittsburgh to understand the situation and give Metallurg a fair compensation. I do not know the amount but I am hoping they will find an agreement. And of course I want the fans to understand me… And forgive me.
Separately from this story two other Russian hockey powerhouses announced that they would sue the NHL clubs. Yuri Lukin, General Manager of Yaroslavl Loko spoke about two players who Loko has under contract:
-We already told “see you” to Taratukhin. He came to see the team, shook everyone’s hands. It is all great, of course. But from our side we told him see we will see him back in Yaroslavl. We are planning to sue Calgary Flames who signed a contract with our player.
As for Mikhnov - it is a similar story. We will have identical reaction too; we will sue the Edmonton Oilers if they will sign him to a contract. As far as I know this hasn’t happened yet. Alexei is in Kiev now, training with Sokol club. I had a conversation with him regarding the issue and he assured me he would send me a copy of the contract with the Oilers as soon as he signs it.
Kazan Ak Bars, backed up by the government of Tatarstan is hoping that they will not have to go to a US or Canadian court. Club’s vice-president said that when it comes to Lisin, his contract is still valid with Ak Bars and Lisin can leave for the NHL with a condition that the NHL will pay a certain buyout fee. The amount of buyout is undisclosed.
As NHL Deputy Commissioner Bill Daly suggested, the NHL will put its massive legal power behind Evgeni Malkin and the Penguins, so this is bound to take a while. Several legal experts have suggested that the NHL shouldn’t allow Malkin to play for the Pens until the situation is resolved, but that’s likely immaterial to the situation.
This court battle will shape up as a “Battle Royal”—Malkin, the NHL, the Penguins, J.P. Barry and “Baghdad” Brisson’s Hollywood-backed agency, and possibly the IIHF against the Russian Hockey Federation and the Superleague’s oligarchs.
And as today’s developments suggest, these developments are bad news for the Phoenix Coyotes, who have Enver Lisin in their stable of prospects, the Flames and Taratukhin, the Oilers and Mikhnov, and, of course, the Detroit Red Wings, who lose the rights to Igor Grigorenko if he’s not signed by June 1st, 2007.
If you’re a Red Wings fan (and if you are, good for you!), you’re worried about Grigs.
As stated on KKF, AvtoVAZ, Lada Togliatti’s ownership, recently went bankrupt, and the Russian automaker is in the midst of a multi-billion-dollar restructuring. Moreover, they’re state-controlled, and the State of Russia’s stake in the company will go up to a 75% controlling interest as AvtoVAZ has decided to sell 25% of its stock to acquire both operating capital and power-train technology. In other words, Lada Togliatti’s a big, big company, but they’re handicapped by their recent bankruptcy (they had to sell off their players in 2005) as well as the Russian government’s ownership.
If I was Kenny Holland, I’d be booking Igor Grigorenko on the next flight out of Togliatti. As this legal battle goes on, it will become harder and harder to get prospects out of Russia without bribery or Malkin-esque slight-of-hand.
In terms of the larger scope of events, the battle is just beginning.
The legal wrangling will get nastier and nastier, and as such, Malkin’s kept on a tight leash by his agents for a good reason: everything he says can and will be held against him in Russian courts. He should worry about his family as well, because he ticked off a billionaire. Russia may be a democracy, but it’s also got a “wild west” tint to the functioning thereof.
The salvos by Gennady Velichkin, who has some reason to worry about his own personal safety for bungling Malkin, are openers in a long and vicious string of Russian and English words that will echo across the Atlantic. Most of those words will come from the pens of Russian sports journalists with a flair for the dramatic, to say the least, and “sports terrorism” will be replaced by even catchier phrases to describe the skullduggery of the evil and malicious intentions of the Penguins and the NHL, who steal Legionnaires and “national treasures” with their empty promises and big American bucks.
Just don’t believe everything you read, and in the words of Flava Flav, don’t believe the hype. Philosophy and values have nothing to do with the fact that Evgeni Malkin was and is worth a lot of money in both the eyes of all parties involved. “Tens of millions,” and if “tens of millions” of dollars are spent on legal wrangling to earn the right to those bucks, that’s okay…
Because there’s an even bigger stake than Evgeni Malkin or the “millions and millions” involved, one that’s always at the heart of fierce battles between sports team owners, sports leagues, and national federations.
Pride. The pride of billionaires on both sides of the Atlantic, who own and control the world’s biggest “big boys’ toys.”
And there’s nothing uglier than a collection of bruised egos.
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Paul Kukla founded Kukla’s Korner in 2005 and the site has since become the must-read site on the ‘net for all the latest happenings around the NHL.
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