Useless trade exceptions

Eric Pincus wrote a piece for the LA Times explaining that two of the Lakers’ trade exceptions are now “functionally expired,” meaning that the trade deadline has passed and these exceptions will expire before the team is allowed to trade again.

As I describe in my FAQ, trade exceptions are the result of non-simultaneous trades. If a team trades a single player away, it has a year in which to acquire up to 100 percent plus $100,000 of the outgoing player’s salary. For example, if a team trades its $10 million player for a $5 million player, it has a year in which it can acquire another $5.1 million in salaries, which is charged to the original trade (i.e., salary matching requirements are ignored). This $5.1 million credit, which lasts a year, is commonly referred to as a trade exception.

Many trade exceptions go unused and simply expire, or are partially used and the remaining balance expires a year after the original trade. Since many trades usually occur right before the trade deadline, you always see a clustering of trade exceptions that expire right around the following season’s deadline. However, since the 2011-12 season was played under an altered schedule due to the lockout, the 2012 trade deadline fell on March 15 rather than its usual late February. This means that trade exceptions from last season’s deadline have not expired, even though they can’t be used.

Teams can start trading again once their season ends — so teams that don’t make the playoffs can start trading again on Thursday, April 18 (all 30 teams play on April 17). Playoff teams can begin trading once they are eliminated (or for the NBA champions, the day after the Finals ends).

Eric reported on the Lakers’ exceptions. Here are the exceptions for all NBA teams which are still active, but will expire on or before April 17.

Team Traded Player Exception Amount Expiration Date
Brooklyn Mehmet Okur $1,390,000 March 15
Brooklyn Shawne Williams $1,377,383 March 15
Denver Nene $13,000,000 March 15
LA Clippers Brian Cook $1,223,166 March 15
LA Lakers Jason Kapono $854,389 March 15
LA Lakers Derek Fisher $544,240 March 15
Memphis Sam Young $1,184,750 March 15
Minnesota Malcolm Lee $381,098 March 11
Portland Elliot Williams $721,440 March 10
San Antonio T.J. Ford $854,389 March 15

In addition, the Lakers have a Disabled Payer exception for Jordan Hill in the amount of $1,781,800, and the Warriors have one for Brandon Rush for $2 million. Normally a Disabled Player exception can be used to acquire a player by either signing or trade. However, since we’re now past the trade deadline these Disabled Player exceptions are now “functionally expired” for trade purposes as well (they still can be used to sign a free agent).

I have only skirted over the details of trade exceptions. For the full explanation, see question number 83 in my FAQ.

3 thoughts on “Useless trade exceptions

  1. bobbyg27

    The Golden State trade exception for $2M is, according to the above table, for Brandon Rush, who in August 2012 re-signed with the Warriors. He was traded *to* the Warriors in December 2011. In early November 2012 he sustained a season-ending injury.

    On the other hand, the Ellis-Bogut trade was completed on March 13th 2012 and came with a trade exception for GSW for Ekpe Udoh, who was included in the deal. Are you sure that trade exception above is for Rush and not for Udoh? If it is, in fact, for Rush, sounds like it should be a disabled player exception, like the Jordan Hill example.

    Cheers.

    1. lcoon Post author

      You’re absolutely right — I didn’t notice that his was a Disabled Player exception when I made the list. This is now fixed — thanks for the heads-up.

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