Got your lawyer glasses on? Ok, here we go -- Section 11.6 of the CBA is titled Rejection of SPCs and/or Offer Sheets; Subsequent Challenge and/or De-Registration of SPCs and/or Offer Sheets; the simpler language is "Why we can reject contracts or offer sheets." I'll give the legal language and my best layman's interpretation for each piece:

(Note: SPC = Standard Player Contract)

(a) Rejection of SPCs and/or Offer Sheets. In the case of an SPC or an Offer Sheet, as the case may be, that is filed and rejected by the League, the following rules and procedures shall apply:

-If the league rejects an SPC or offer sheet, this is what's going down:

If an SPC or an Offer Sheet is rejected: (A) because it results in the signing Club exceeding the Upper Limit, or (B) because it does not comply with the Maximum Player Salary or (C) because it is or involves a Circumvention of either the Club's Upper Limit or the Maximum Player Salary, and:

-These are the reasons why the league can reject a contract, so if one of these is violated...to be continued...

(x) if the NHLPA does not timely dispute and refer to the Arbitrator such rejection in the manner set forth in Section 11.5(g) above, then immediately upon the expiration of the time period within which the NHLPA may dispute and refer to the Arbitrator such rejection, the SPC or Offer Sheet, as the case may be, will be deemed null and void ab initio (i.e., the Player's Free Agency and/or contractual status shall revert to the status he held prior to signing his SPC or Offer Sheet, as the case may be), and the Player shall not be entitled to any of the rights or benefits provided for under the rejected SPC or Offer Sheet, as the case may be; or

-If the NHLPA doesn't dispute within a reasonable time, the player hits free agency again. BUT WAIT, there's more!

(y) if the NHLPA does timely dispute and refer to the Arbitrator such rejection in the manner set forth in Section 11.5(g) above, then such dispute over that rejection shall be both heard and decided by the Arbitrator within fortyeight (48) hours of such referral, during which period the Player shall not be entitled to play under such SPC or Offer Sheet, as the case may be, and shall not be entitled to any of the rights and benefits provided for under such SPC or Offer Sheet, as the case may be, pending a resolution of such grievance by the Arbitrator.

-If the NHLPA does dispute within 48 hours five days (update), then we go to...(insert James Earl Jones voice)...The Arbitrator. Who's that? Well, let's go back to section 11.2 of the CBA:

A Grievance pursuant to this Article  shall be heard by, and the term Arbitrator as used in this Article shall mean, the Impartial Arbitrator or the System Arbitrator, as the case may be, as required by the terms of Article 17 and Article 48 of this Agreement.

So, the league rejected Ilya Kovalchuk because they'll claim it's cap circumvention. The NHLPA has 48 hours five days (update) to decide if it wants to dispute. If they don't, Kovy hits the open market again and Dean Lombardi picks up his phone. If they do, it goes to an arbitrator.

Update: I'm guessing the league will point to the age in the final year of the contract. QuantHockey has a detailed post from January 2009 on the average age of NHL retirement. 0.02% of players retired at 44 (Kovalchuk's age at the end of the deal) -- that's compared to 0.11% of players at 42 (Marian Hossa and Roberto Luongo contracts).