After Kenneth Dam ruled the Knicks would win their case against the NBA for the early bird-rights to Jeremy Lin and Steve Novak, the NBA immediately revealed that they planned to appeal the decision. The two parties have been in communication in hopes of coming to a settlement before the clock struck 12:01 AM, July 1st.
Fortunatley, the sides settled. Jeremy Lin and Steve Novak will both have early bird-rights, which means they are not eligible for any contract valued more than the league average salary – around $5 million – in the first year, and more importantly, the Knicks can go over the cap to sign the players.
With the settlement, from now on, players that are claimed on waivers will continue to keep early bird-rights, as if they had been traded. However, from now on, full bird-rights will only be granted if the player is claimed on waivers through the amnesty provision.
To explain this more in regards to the Knicks, with the early bird-rights, the Knicks can go past the league mandated salary cap, while spending the max amount of money that Lin and Novak are eligible for. Now, while the Knicks can retain their top two free-agents, once they hit the $69 million number, they’ll be unable to use the full $5 million MLE – which would put them right at the $74 million tax paying apron, unless they want to be hard capped.
Yesterday, Glen Grunwald incidentally said that “it’s likely that we’ll be a taxpayer… So that’s why we would be operating under the $3 million” mini-MLE.
This is fantastic news, since now there will be no worries about re-signing the Knicks’ top two free agent, and they will have the ability to use $3 million to try and attract a solid player. Free agency starts at midnight, so soon enough, we’ll see for how much and for how long Jeremy Lin and Steve Novak re-sign for.