The New York Islanders obtained Ehrhoff's rights from the Vancouver Canucks on Tuesday for a fourth-round pick in the 2012 Entry Draft, but failed to negotiate a new contract with him and engineered a deal with the Sabres to acquire Buffalo's fourth-round pick in 2012.
According to a report in Newsday, the Islanders broke off talks with Ehrhoff after the two sides failed to reach an agreement before a 5 p.m. Wednesday deadline imposed by General Manager Garth Snow.
"We made a significant offer," Snow told the newspaper. "I don't want to get into specific numbers, but I felt like we made a good offer and a good run to get Christian to sign."
Snow wouldn't reveal the contract terms, but Newsday reported it was "well north" of the five-year, $23 million contract fellow blueliner Kevin Bieksa received earlier this week.
Ehrhoff is one of the game's best at adding offense from the blue line. The 28-year-old had a career-high 14 goals and 36 assists in 79 games last season. He had 2 goals and 10 assists in 23 playoff games, but struggled mightily during the Stanley Cup Final as he played through a shoulder injury he suffered in the Western Conference Finals.