In a statement Tuesday, the Oilers said Nylander had signed with the Oilers on Sunday, only to then sign a US$19.5-million, four-year contract with the Capitals the next day.
To make matters worse, the Oilers say they held off going after other potential free agents because they thought they had Nylander in the bag. The 34-year-old Swede was one of the top catches on the free-agent market, setting career highs in goals (26), assists (57) and points (83) with the New York Rangers last season.
"On Sunday, July 1, 2007, Kevin Lowe, Oilers general manager, and Mr. Mike Gillis, certified agent for Michael Nylander, negotiated and agreed to a multi-year NHL Standard Players Contract, starting in 2007-08. Mr. Gillis confirmed same to the Oilers in writing," the Oilers' statement read Tuesday.
"The Oilers then proceeded with preparations to announce Mr. Nylander's contract agreement on July 2, and concurrently continued with the process of negotiating with other free agents based upon Mr. Nylander being an important roster ingredient for the future.
"However, while the Oilers were expecting the returned signed agreements from Mr. Nylander and Mr. Gillis, the Oilers discovered through public announcements made mid-afternoon on July 2, that Mr. Nylander had subsequently entered into a long-term contract with the Capitals.
"The Oilers can find no precedent for such conduct in our history. The Oilers are examining and pursuing every course of action available in the best interest of the team and our fans.
"For legal reasons, the Edmonton Oilers hockey club will not be discussing the details any further at this time."
A lawyer for the Oilers could not provide contract details on the Edmonton deal.
Calls to both Lowe and Gillis by The Canadian Press were not immediately returned Tuesday. The NHL also did not have an immediate response. A call into Caps GM George McPhee was also not returned.