CHL Players Continue Their Fight For Fair Play
Updated: Oct 15, 2020
By: Matt Rubinoff
Young athletes are once again challenging the structure and rights of their developmental process. As previously reported, the Canadian Hockey League (CHL) settled a class-action lawsuit earlier this summer in a battle with former players of the respective three developmental leagues and their request to be paid minimum wage as rightful employees. Just over three months later, new claims have sought a more professional route.
The Canadian Hockey League is an umbrella organization split into three leagues across Canada and parts of the United States: The Western Hockey League (WHL), The Ontario Hockey League (OHL), and The Quebec Major Junior League (QMJHL). Players are drafted into the league, based on region, at the age of fifteen or sixteen, and can play up to the age of twenty. In hockey circles, these leagues are known as the “major junior” level and makeup nearly half of the rostered players in the NHL. For a more in-depth background on how the CHL structure works and its success rate with developing talent for the NHL, you may refer to my previous article on the CHL minimum wage lawsuit.
In this case, former WHL player Kobe Mohr filed an $825 million class-action lawsuit alleging conspiracy among some of the top professional and amateur hockey leagues. The alleged conspiracy includes exploiting teenage athletes to one-sided contracts with “abusive restrictions on their young careers.”
Though not yet certified, the class-action lawsuit takes direct shots at the largest and most successful farm system for hockey talent. Distinguished from the previous minimum wage battle between the players and the CHL, this claim additionally incorporates the National Hockey League (NHL) as well as its two affiliated minor league systems: the American Hockey League (AHL) and the East Coast Hockey League (ECHL).
According to recent reports from the Toronto Star, who obtained a copy of the complaint, the allegations cite a “system of hockey leagues” in Canada and the United States where “the overwhelming majority of players will never reach the well-paid top professional leagues, but rather spending numerous years playing for nominal sums of money, all to the financial advantage of the defendants.” These contracts, according to the plaintiffs, “undermine players’ ability to negotiate for better pay or organize a collective bargaining agreement, in violation of Canada’s Competition Act, the claim alleges.”
The claim goes on to mention that these restrictive contracts for major junior players are “contracts of adhesion … [that] fail to disclose [to the players] all the restrictions.” Moreover, the claim cites one of these restrictions as an “abusive” $500,000 fee for leaving the league early to pursue other professional hockey leagues. In other words, if the contracted player in the CHL decides to leave his team early for an opportunity in professional hockey, whether in the minor leagues in North America or the many professional leagues in Europe, he is forced to pay a significant fine for breaching his CHL agreement. On a roughly $125 per week stipend, this is likely not a reasonable option for the player.In turn, he is forced to play out his years in the OHL.
As stated by Mohr, “I don’t think it’s right to impose restrictions on a player that demands a $500,000 release fee to be paid to the club if the player wishes to pursue other opportunities in other leagues around the world.” Further, the claim alleges that the ties between the CHL and NHL include bonuses for CHL teams when their players are drafted. This, according to the plaintiffs, “serve to control player destinies.”
The AHL-CHL Rule
Given that the CHL provides nearly half of the rostered players in the current NHL, what is the big deal for the many of these NHL-drafted players? Won’t most eventually get their chance to sign professionally, attend training camp, and maybe make an NHL roster? It depends. And once they are signed professionally, their options to play professionally are severally limited for the duration of their first NHL contract.
Hockey fans probably know of the AHL-CHL rule, at least indirectly, through the following of their favorite teams. Once a CHL player is signed to his entry-level three-year contract, the clock on that contract does not start ticking until he has played ten regular-season or playoff games for his team. At the start of each season, this tactic is strategically used to “try-out” younger players, many of whom are cut after the ninth game.
After that player is cut, where does he get sent? In the NBA, a player may be outright released or sent to the G-league for further development. In the NFL, maybe to a practice squad. In the MLB, probably to one of many minor league options. In the NHL, if that player is in the CHL and under the age of twenty, he is sent back to his junior team. Not the affiliate AHL team. Not the affiliate ECHL team. Rather, back to the CHL to complete the performance of his CHL contract.
Logically, this does not seem optimal from a general management perspective. For example, Kyle Dubas – the general manager of the Toronto Maple Leafs – would much rather have an eighteen-year-old prospect train and develop with his affiliate Toronto Marlies AHL team down the road. Instead, he is forced to cut bait and send that player back to the CHL for the season. With limited exceptions for emergency call-up rules, that player is lost until the following year’s training camp.
From a player’s perspective, the same logic applies. If you are good enough to compete for a spot, you would much rather be playing and developing alongside established, professional hockey players in the AHL and playing your tail off for a mid-season call-up to the big team. Instead, you are forced to run it back for another season in the CHL.
Moreover, economically, that player does not receive any part of his NHL or AHL salary as part of his entry-level contract. As mentioned before, the clock has not yet started on that agreement. Thus, while he has the benefit of going back to his teammates and friends in the CHL, maybe on a stacked team and playing for a coveted Memorial Cup, he remains a fixture of the student-athlete payment scale. Analogous to the college football player in his junior year hoping not to get injured or tank his draft stock, there is clear and unnecessary risk involved in the process.
Strategically, there is an argument to be made for sending a player back to the CHL to “dominate” the league for one more season and ensure that his confidence is not shattered by the professional game. This has been the accepted historical narrative. From a 2020 perspective, as the NHL trends younger, some could argue this strategy no longer holds up. But that is a management/coaching tactical argument for another time. If anything, this is something that could easily be fixed by including an option in the contract for management to decide where their player is sent. Instead, the rights of a drafted CHL prospect, and CHL prospects only, are restricted to one path.
The bottom line: there are serious inconsistencies and restrictions on these CHL players compared to other young talents in the NCAA or Europe.
Inconsistencies in the NHL Prospect Model
As stated by the lawyer for the plaintiffs, “[y]ou have one choice as a North American player — you play for the NHL or you play for free.” Further, “if you are not drafted at 18, you can’t go play in the American Hockey League or East Coast Hockey League. The NHL makes it impossible for players (to) sell their work elsewhere. These players have no right to choose where they go.”
Let’s consider three top-end NHL prospects as a comparative example: Cole Caufield, Moritz Seider, and Dylan Cozens.
Caufield was drafted 15th overall in 2019 by the Montreal Canadiens. He played his 2019-20 season for the Wisconsin Badgers of the NCAA. During his off-seasons, Montreal may sign him to an NHL contract. Once that occurs, he is (1) released from the NCAA because he is no longer a student-athlete, and (2) eligible to play for the Montreal Canadiens. If he does not make the NHL team, he is free to be sent down to the Laval Rockets, Montreal’s AHL affiliate.
Seider was drafted 6th overall in 2019 by the Detroit Red Wings. As a German-born and locally developed player, he played his draft-year season in the German elite league, the Deutsche Eishockey Liga (DEL). Seider signed his entry-level contract after the draft but did not make the Detroit Red Wings for the 2019-20 season. Instead, he played for their AHL affiliate in Grand Rapids as an eighteen-year-old.
Cozens was drafted 7th overall in 2019 by the Buffalo Sabres. Before the draft, Cozens played in the WHL for the Lethbridge Hurricanes. Similar to Seider, following the draft, Cozens signed his first NHL contract. However, Cozens did not make the Sabres out of training camp and was subsequently sent back to Lethbridge. This year, at nineteen, if Cozens does not make the Sabres, he will once again be forced back to the WHL.
Three backgrounds and three different types of development, but only the CHL model holds back prospects from professional hockey for a set period.
Understandably, each player is unique in how they may grow as a professional athlete. But, as is typically at the center of these disputes: money matters. Seider and Cozens are set to make $925,000 as rookies once they make the NHL. Until then, Seider is set to make $70,000 in AHL salary per season. Cozens is forced to remain a student-athlete and receive his allowed stipend.
Compared to the US college student-athlete, the CHL model is a seemingly backward process:
In the NCAA, a player may not return to play college hockey after they have signed their first professional contract. In the eyes of the NCAA, that player is no longer an amateur.
In the CHL, the league similarly considers its player’s amateurs and student-athletes under the law, most recently as its primary argument to not pay them at least a minimum wage. However, once they sign professional contracts in the NHL, they are restricted access to non-NHL leagues. It is either make the pros or go back to junior hockey.
Again, this is the case for the few lucky prospects that make headlines and get drafted and signed by an NHL team. For most other players, their mobility to other professional leagues, as explained in the lawsuit, is limited not only by the AHL-CHL rule but by the alleged large fines for leaving the CHL to pursue any other professional league before the age of twenty.
What Will This Lawsuit Accomplish?
This is still very early in the process, but the next step for the players is to get the claim certified as a class-action. Considering the past minimum wage lawsuit took nearly six years of litigation dating back to the original filing in Ontario in 2014, this battle is likely far from over.
Will it succeed? It is still too early to tell. Considering the realities of the pandemic and the financial impact put on minor leagues across North American sports for years to come, it is difficult to imagine the requested $825 million coming back to the players.
According to the claim, though the amount is subject to change, damages sought includes “$50,000 for lost income be paid to about 1,500 players each season dating back to 2010; $2,500 per player per season for lost rights to their images, sponsorship and endorsement opportunities and $2,500 per player per year for ‘moral damages’ or ‘breaches of players’ fundamental rights of freedom.’”
Realities of the Lawsuit
Similar to the recent minimum wage lawsuit, the players seek more than money. Joining the claim, the Swiss-based World Association of Icehockey Players Unions (WAIPU) supports the young player’s goals in fair pay and fair contracts. Lucien Valloni, president of WAIPU, believes the North American leagues are a “one-sided business model” in a “multi-billion-dollar business.” Moreover, a Toronto lawyer for the plaintiffs (and former CHL player) also noted in the claim, “[young players] are not free to organize and to form and participate in groups, either formally or informally and to negotiate any collective bargaining agreement.”
Unsurprisingly, the ultimate goal of the suit, per Valloni, is a collective bargaining agreement for major junior hockey players “that protects their interests going forward.” If anything, this process is meant to start, again, a discussion on how young athletes are treated in hockey’s development system in Canada.
Most – if not all – CHL prospects and players know what they are getting into once they sign a CHL contract. At least, they understand the sacrifice from an athletic perspective. That is, playing in one of the best leagues in the world to prepare you for the ultimate goal: the NHL. Even more so, each player likely realizes the odds of playing just one NHL game is slim to none. The opportunity, therefore, to participate in the CHL is modest enough – a privilege, for lack of better term – for most of these athletes. Talk to any of them, and many will say that they will take what they can get. No different than the bench player on Duke basketball or the backup lineman on Alabama, a large portion of these players are happy to be there and happy to compete their chance at a dream.
Idealistically, this is a bill of goods the players are given from the start. Whether it is the NCAA convincing the public that amateurism is more important than fair pay, or the CHL using their limited scholarship package as justification for labeling their workers as “student-athletes,” we were – until recently – satisfied with the status quo. For those in power, the status quo is the comfort zone. If 2020 teaches us anything, being uncomfortable through change is a good thing. Even in sports, being uncomfortable helps you try to understand a different perspective and allows you to adapt to the dynamic nature of society. And as we have seen, times are changing.
Matt is a rising 3L at Penn State Law.
 See Elliotte Friedman, CHL Settles Class-Action Lawsuit Over Minimum Wage Payment, Sportsnet (May 15, 2020 1:50PM), https://www.sportsnet.ca/hockey/juniors/chl-settles-class-action-lawsuit-minimum-wage-payment/.  See Matt Rubinoff, Amateurism North Of The Border: The Fight For Minimum Wage In The Canadian Hockey League, LongRunSports (July 22, 2020), https://www.longrunsports.com/post/amateurism-north-of-the-border-the-fight-for-minimum-wage-in-the-canadian-hockey-league.  See Robert Cribb, NHL, Junior Hockey Leagues Part Of ‘Conspiracy’ To Exploit Teenage Players, $825M Lawsuit Alleges, Toronto Star (Sept. 15, 2020), https://www.thestar.com/news/investigations/2020/09/14/nhl-junior-hockey-leagues-part-of-conspiracy-to-exploit-teenage-players-825m-lawsuit-alleges.html.  Id.  Id.  Id.  Id.  See id.  Based on conversations with CHL alumnus Daniel Poliziani, who played for the Guelph Storm of the OHL from 2011-13, the stipend received about $125 per week; see also Patrick King, Improved OHL Benefit Package Changes Landscape, Sportsnet (Feb. 24, 2014), https://www.sportsnet.ca/hockey/juniors/improved-ohl-benefit-package-changes-landscape/.  See King, supra note 9.  Cribb, supra note 3.  See Cribb, supra note 3.  See Rubinoff, supra note 2 (“[S]ince 2009, about 44% of the total players selected in the NHL Entry Draft played their previous season in the CHL, or 1,025 of the last 2,336 draft picks.”).  See Canadian Press, CHL Has No Intentions On Changing Underage Rules, AHL Exemptions, Sportsnet (May 26, 2016, 5:15PM), https://www.sportsnet.ca/hockey/nhl/chl-no-intentions-changing-underage-rules-ahl-exemptions/.  See QuantHockey, 2018-19 NHL Demographics, https://www.quanthockey.com/nhl/seasons/2018-19-nhl-players-stats.html, (last visited October 17, 2019), (noting recent trends have shown a rise of younger teams and younger core impact players. Since 2012-13, the percentage of players on NHL rosters at age 24 or younger has gone up from 35% to 41% in the most recent 2018-19 season. Players 32 years of age and older has decreased from 17% of roster spots in 2012-13 to 12.3% in 2018-19).  Cribb, supra note 3.  Cribb, supra note 3.  See Cole Caufield, Elite Prospects (last visited Sept. 29, 2020), https://www.eliteprospects.com/player/316168/cole-caufield.  See Moritz Seider, Elite Prospects (last visited Sept. 29, 2020), https://www.eliteprospects.com/player/258987/moritz-seider.  See Dylan Cozens, Elite Prospects (last visited Sept. 29, 2020), https://www.eliteprospects.com/player/258987/moritz-seider.  See Danica Ferris, Dylan Cozens Returns To Lethbridge Hurricanes Lineup After Impressive Stint With Buffalo Sabres, Global News (Sept. 27, 2019), https://globalnews.ca/news/5962507/lethbridge-hurricanes-dylan-cozens-returns/#:~:text=WATCH%20ABOVE%3A%20Dylan%20Cozens%20will,by%20the%20Buffalo%20Sabres%20Thursday.  See Ken Campbell, Former Players Made A Point In CHL Wage Lawsuit, But Junior Hockey Dodged A Major Bullet, Sports Illustrated (May 15, 2020), https://www.si.com/hockey/news/former-players-made-a-point-in-chl-wage-lawsuit-but-junior-hockey-dodged-a-major-bullet.  Cribb, supra note 3.  See Cribb, supra note 3.  Cribb, supra note 3.  Cribb, supra note 3.  Cribb, supra note 3.