Trades involving TPEs

[statsman]

Assume there are two teams over the salary cap looking to make a trade.

Team A wants to trade Player A who makes $5M. Team A also owns two TPEs, one for $3M and one for $2M.

Team B wants to trade Player B who makes $3M and Player C who makes $2M.

Since the salaries match exactly, Player A can be traded for Player B plus Player C.

But can Team A use its two TPEs to acquire Player B and Player C in this trade? If so, would Team A also receive a $5M TPE for Player A?

[Smitty731]

No. TPEs only come in to play when necessary. If the salaries match, they don't matter.

Now, if the team with the 2 TPEs wanted to acquire the players without trading a player themselves, they could do two separate deals for something like heavily protected second round pick. That would get it done.

[answerthink]

The answer to statsman’s question is actually yes.

It is important to view a trade from each team's perspective separately, rather than as a single, unified transaction. Each team party to a trade can structure it any way they like, within the confines of the rules. And, given the data provided, the way statsman proposes seems likely to be the way Team A would structure the hypothetical trade described.

[statsman]

Interesting. Two different answers. I can see it working both ways. Would love to be able to contact Larry Coon for his opinion.

Thanks for the feedback.

[answerthink]

What if I promised I am correct? : )

The answers to questions 81-84 of the FAQ should clear up any questions you may have on the issue. If you'd like to ask LC directly, he is often available through a variety of media.

[statsman]

What if I promised I am correct? : )

The answers to questions 81-84 of the FAQ should clear up any questions you may have on the issue. If you'd like to ask LC directly, he is often available through a variety of media.

Sorry about that. It was just that I received two different answers. I am inclined to believe what you posted, having read that section of the Salary Cap FAQ a few times. It doesn't quite cover the situation I presented, which is why I posted here.

I'll read those questions carefully one more time to see if I can convince myself what you posted is correct (and for the record, I hope you are correct).

[mysticbb]

:lol: Sorry about that. It was just that I received two different answers. I am inclined to believe what you posted, having read that section of the Salary Cap FAQ a few times. It doesn't quite cover the situation I presented, which is why I posted here.

answerthink gives the correct answer here. Trades are viewed from each teams perspective and can be arranged from each teams perspective in order to fit.

Essentially in your example

Team A:

Player A $5m
TPE $3m
TPE $2m

Team B

Player B $3m
Player C $2m

From Team A perspective:

1st trade:
$3m TPE for Player B

2nd trade:
$2m TPE for Player C

3rd trade:

Player A for $5m TPE

(The order isn't important here!)

From Team B perspective:

Player B + Player C for Player A

In Coon's faq we can read under 81: Note that sometimes there are multiple ways to configure the same trade. For example, a minimum-salary player might be acquired using either the Traded Player exception or the Minimum Salary exception, or a two-for-two trade might also work as two separate one-for-one trades. Teams are allowed to choose the configuration that works best for them. See question number 87 for an example of this.

Also under 84: A common misconception is that players cannot be traded together in a non-simultaneous trade. This is not true -- players can be traded together as long as the deal can be constructed as separate, parallel trades in which the outgoing salaries are not aggregated. For example, trading two $10 million players for a $20 million player requires aggregation, and therefore must be simultaneous. But trading two $10 million players for a $12 million player can be accomplished without aggregation -- one of the $10 million players would be used to acquire the $12 million player in a simultaneous trade, and the other $10 million player would be traded for "nothing," in a non-simultaneous trade, gaining the team a $10 million trade exception.

That essentially covers your example.

Smitty731 answer is wrong on many accounts.

For future references: I trust answerthink's responses as much as I would trust Larry Coon's.

[Smitty731]

It is very likely that I am confused, and I appreciate the education if I am! Below is my reasoning. Please feel free to correct me and help me understand better. And I mean that sincerely.

If you break it up in to 3 individual deals, you can use the TPEs. This also assumes something is being sent back. You can't deal from one side, for nothing from the other.

If you do it as one deal, the salaries match and that would be the first criteria evaluated. The TPEs would not be involved.

When I answered, I answered under the assumption that it was one deal. In the case of one deal, my answer was correct.

Unless I am completely misreading, the section of the FAQ outlined under the same questions you referenced. I see it as, TPEs only come in to play when there is not matching salary, within the % + 100k. This is either through a TPE being created, or one being used. In a case where the salaries match exactly, and it is one deal, why would a TPE be triggered for use?

[mysticbb]

If you break it up in to 3 individual deals, you can use the TPEs. This also assumes something is being sent back. You can't deal from one side, for nothing from the other.

That is wrong. The TPE is just there to take on a player, the team does not have to give up anything else. Such a deal is considered a non-simultaneous trade and is described in question 84 in Coon's faq.

If you do it as one deal, the salaries match and that would be the first criteria evaluated. The TPEs would not be involved.

The deal can be looked at as one deal or 3 separate deals depending from which team you are looking at the trade. Teams can arrange a trade in whatever way they like, if that is in agreement with the CBA. Such a trade can look completely different for one team than for the other team. As I described in my example, team B has to combine both players salaries in order to create a TPE big enough to take on the salary of the other player (assuming they don't have the necessary capspace). All the while team A can just simply separate the same deal into 3 individual trades, where they can use their existing TPEs while even getting a new TPE back.

When I answered, I answered under the assumption that it was one deal. In the case of one deal, my answer was correct.

The issue with your answer is that there is no such "one deal" here. Yes, the teams could also trade player A for player B+C, which works, but that really has nothing to do with "first check the salary match then maybe use TPE", such a rule does not exist.

In a case where the salaries match exactly, and it is one deal, why would a TPE be triggered for use?

Because there is no such rule in the CBA. ;)

[Smitty731]

I appreciate the detailed response. I think the more I read it and re-read it, what you are saying now makes sense. Sometimes I think I need to read this stuff 100x or more to get it. Even then, I don't really know.

I do have one minor issue, and maybe I can be corrected here as well. For a non-simultaneous, you do still eventually need to take something back right? I think I remember reading in the FAQ (combing it now to be sure), you can't ever trade something for nothing at all. Which is why some teams hang on to draft rights for players long since done playing. They can always use them as the something. Am I incorrect on this?

[mysticbb]

I'm not quite sure whether I understand your question correctly, but it seems it gets answered within the question 84 of Coon's faq: http://www.cbafaq.com/salarycap.htm#Q84

So, a team giving up a player in a non-simultaneous will get the commonly known TPE and have one year to complete the trade. But they don't need to, they can renounce the TPE or just simply let it expire.

[Smitty731]

Let me rephrase. Let's say this is the trade:

Team 1 trades Player A (5 million) to Team 2.

Team 2 absorbs Player A with a 5 million TPE.

What does Team 2 have to send to Team 1? They have to send them something right? Even if it is within the year. They have to send a player, pick, or cash right? They can't just absorb the player without anything going the other way.

For example when OKC traded Eric Maynor to Portland, they had to take back the rights to Georgios Printezis back, in addition to the TPE created by dealing Maynor. They couldn't take back just the TPE.

I took this off Mark Deeks' website for full credit: "In trades, both teams have to give up something. What that something is, is up to them. A player, pick, or cash are options. But sometimes, they don't want to (or can't) give those things up. So they have to give up at least something, even if only as a token gesture. That's where these scrub's draft rights become useful. They can act as the "something" given up in a trade. A team can give up the draft rights to a player as their outgoing half of a trade, and add in nothing more if they so wish."

This is where I am getting the part about something has to be given up on each side. Unless I am wrong, a created TPE doesn't count as that something. Or does it?

Again, thanks for the education and the fun back and forth. At least it has been fun for me!

[DBoys]

Smitty, it is true that you cannot trade something for nothing in an overall trade. But that overall trade does NOT get broken down into smaller trades of something-for-something, in the trade matching process. (That "smaller trade" concept was the prevailing theory at one time, many moons ago, until a cap guy in an NBA front office shared with me how it's actually done.)

In fact, it is by having an outgoing player whose TE is not needed to be used to match an incoming (in a sense a something-for-nothing), that is one way a new NS TE is generated for the team to use later. (Of course, you also are given a NS TE if you trade away a single player whose salary is bigger than the incoming used to match.)

[MarkDeeks]

This, incidentally, is how so many often redundant TPE's equal to the minimum salary are created.

[MarkDeeks]

If it helps, I wrote this.

http://www.sbnation.com/nba/2014/2/20/5 ... a-analysis

[MarkDeeks]

To self-whore once more - but at leasting rhyming while doing it - this was interesting.

http://www.shamsports.com/2014/07/consi ... trade.html

Wonder how this affects all this type of manoeuvring.

[bondom34]

To self-whore once more - but at leasting rhyming while doing it - this was interesting.

http://www.shamsports.com/2014/07/consi ... trade.html

Wonder how this affects all this type of manoeuvring.

Kind of amazing even the front offices don't understand the stuff. Makes me feel a bit better.

[DBoys]

To self-whore once more - but at leasting rhyming while doing it - this was interesting.

http://www.shamsports.com/2014/07/consi ... trade.html

Wonder how this affects all this type of manoeuvring.

Kind of amazing even the front offices don't understand the stuff. Makes me feel a bit better.

Actually these are new rules, or a formalization of guidelines that had cropped up over time as issues with fuzzy legality arose and decisions had to be made. Teams probably knew this stuff, from random memos, but it was not consolidated into strict mandates and sent out until 2 days ago.

Mark did a great job of sharing and explaining them in his blog. They have also been added to the CBA FAQ for future reference,

[MarkDeeks]

The exact wording of the memo, which was slightly patriarchal, suggested they were slightly miffed at people trying to push the boundaries. Which was fun.

[DBoys]

The exact wording of the memo, which was slightly patriarchal, suggested they were slightly miffed at people trying to push the boundaries. Which was fun.

It might have been fun if, within their implied threats, they added: "If you skirt the rules, we might even take away your team. You know we can now, so don't test us!"