Certification of Dave Meltzer filed in Alvarez-Bellator lawsuit

February 11, 2013

MMA Fighting and the Wrestling Observer’s Dave Meltzer has filed a certification of UFC PPV numbers in a recent filing in the Eddie Alvarez-Bellator lawsuit.  Meltzer, filing on behalf of Alvarez, attests to UFC PPV buy rates and makes an estimate on buy rates featuring GSP and Jon Jones.

Notably, in the January 24, 2013 certification, he testified that cards headlined by GSP average 770K PPV buys excluding UFC 100.  Jon Jones’ average between 500-525K buys.  His Certification also includes a breakdown of UFC PPV buys over the last 3 years.  The premise is that Alvarez would have appeared on a card which headlined GSP or Jones.

In the Certification, he indicates that he is “one of the best, if not the best, source of pay per view buy rates in mixed martial arts.”  Meltzer states that he has reviewed the Declaration of Ray Longboard as it relates to Mr. Longboard’s opinion that Alvarez would not have received 200K PPV buys if he were to appear on a UFC PPV.  Mr. Longboard’s Declaration was filed in conjunction with Bellator’s opposition brief to Alvarez’s request for a preliminary injunction.

Meltzer states that the UFC has averaged between 450K to 475K PPV buys over the last 3 years. Only twice did the UFC draw 200K or below in those 3 years according to Meltzer.

Meltzer stated that if Alvarez appeared on a PPV with GSP, the buy rate would exceed 680K PPV buys.  He stated that a Jones PPV with Alvarez participating would exceed 450K PPV buys.

Meltzer indicates that the “buy rates are an approximations which are calculated from various other indicators, but are generally accepted as accurate throughout the mixed martial arts industry.”

Payout Perspective:

Interesting.  In addition to the Certification, Meltzer includes a list of PPV buys (which he lists as “UFC PPV Estimates”) over the past three years.  MMA Payout has updated our Bluebook and you can view them here.  This is a very interesting turn of events as the Certification opens up the issue of how PPV buys are estimated.  Although the Certification does not go into detail about how buy rates are approximated, this method will come out during a deposition and/or other phase of discovery.  The question will be whether Mr. Meltzer will divulge his methods and/or sources.  This brings up journalistic ethics versus the law.  Would a Court require Meltzer to divulge a source and/or would Meltzer risk being in  contempt?  At this point, Bellator would argue that the methods of Meltzer are undefined and that his opinion of the PPV estimates lack foundation and call for speculation.

The discovery phase of the Alvarez case just got a little more interesting.  We will see the extent as to how much Bellator will try to pull back the curtain on PPV buys.  

19 Responses to “Certification of Dave Meltzer filed in Alvarez-Bellator lawsuit”

  1. Dan on February 11th, 2013 11:38 AM

    1) Why are both sides focusing on the PPV aspect when the big difference in the deals seems to be the FOX vs. Spike thing?

    2) I’m far from a legal expert, but I think all of the generalities and “approximations” in the PPV buys talk on both sides make it virtually worthless in court. Unless UFC comes forward and backs up the claim they’ve only done under 200k buys twice since 2006, it’s all too inexact.

    3) Really curious to see what “calculated from various other indicators” means. That’s a very vague statement. Any guesses?

  2. Machiel Van on February 11th, 2013 2:46 PM

    Seems like Meltzer’s educated guesstimates shouldn’t factor into a court case. What does “Certification” with a capital C mean? It sounds official, but Meltzer’s PPV estimates are not official data.

    Dan,

    I’d assume their sticking on the PPV issue because it’s the root of the potential disparity between the potential yield of each contract (appearances on UFC PPVs would unquestionably garner Alvarez more money, but how can this be proven?), while the FOX vs SPIKE debate is about exposure, which is far less financially tangible (unless they want to talk potential sponsorship access/earnings, which seem to be absent from the conversation). As for Meltzer’s “other indicators”, could be talking about simple things like online trending, starpower of those on the card, etc., but I can’t be sure what he’s specifically referring to.

  3. Dan on February 11th, 2013 4:00 PM

    I know Dave talks to people with cable companies and UFC, so the likelihood of basing it on something like star power is quite unlikely. I’m sure it’s at least based on some real data.

    I thought the FOX vs. Spike debate would be more prevalent because there’s such a clear disparity in real, certifiable viewership figures as well as households the networks reach.

  4. Nick on February 11th, 2013 4:29 PM

    The UFC could have given official numbers but chose not to. This makes me think that Dave’s numbers are pretty close, or the UFC would have coughed up their numbers.

  5. Dr ozzie on February 11th, 2013 5:32 PM

    Dana routinely ridicules Meltzers ratings info when they’re not what he likes…but never mentions that his ppv numbers are off…which tells you that they are inflated numbers..a “guesstimate” is not going to hold up in a court…

  6. Random Dude on February 11th, 2013 5:34 PM

    “The UFC could have given official numbers but chose not to. This makes me think that Dave’s numbers are pretty close, or the UFC would have coughed up their numbers.”

    Terrible assumption. There are many reasons why the UFC would not want real numbers revealed. It could cause an increase in demand of PPV % by fighters. It could cause a change in the terms of the loans for all the debt that they have taken out. It could affect future ability to take out debt.

    Dave Meltzer is continuing is usual scam of “being in the know” when he actually knows nothing.

  7. Brain Smasher on February 11th, 2013 6:04 PM

    I disagree. I think this shows Daves numbers are pretty close. I doubt he would go out on a limb and put himself in the legal process if his numbers were not 99% right. He knows the court will ask for his sources and he obviously is pretty condifent in them. People tend to forget there have been times his numbers have been confirmed. LIke the Couture situation. He has also been the source for PPV numbers as far back as i can remember. I cant remember anyone of the promotions he released numbers on proving he was wrong.

    I still dont see the court setting a precedent here in trying to predict PPV sales. As much as i would love for them to rule in Alverez’s favor. I dont see how they can even though it is plain as day the UFC is deal by far better. Maybe even twice as lucrative. Its a shame the court system doesnt opporate on common sense. But instead will allow technicalities and loopholes to win out over what is right.

  8. Nick on February 11th, 2013 7:45 PM

    I’m pretty sure their lenders are getting accurate numbers. You don’t just go make up numbers with no verification and secure hundreds of millions in financing.

  9. Brain Smasher on February 11th, 2013 10:37 PM

    I wonder if Dave coming forwards is part of a larger plan? Maybe he comes outs and gives his numbers of what the UFC has done and what UFC and Bellator will do. The the UFC comes in and releases its numbers to the court giving Dave credibility in the courts eyes on Non UFC PPV predicitions. If the courts take into account possivle PPV sales from each promotions. The honestly who is more qualified than Dave besides the UFC to set those estimates?

  10. Random Dude on February 12th, 2013 6:46 AM

    “People tend to forget there have been times his numbers have been confirmed. LIke the Couture situation.”

    People keep saying this, but never post a link proving it. Still waiting…

  11. Random Dude on February 12th, 2013 7:00 AM

    “I’m pretty sure their lenders are getting accurate numbers. You don’t just go make up numbers with no verification and secure hundreds of millions in financing.”

    First we don’t know who all the lenders the various corporations and the actual individual people (Lorenzo, Dana, etc) actually have. Different lenders have different requirements. Private hard money loan terms are very different from say a public institution. Not to mention, you would be surprised what passes for confirmation of financial status, especially when higher amounts are involved. Particularly if the entity giving the loan doesn’t have to care whether the debt actually gets serviced, and profits as long as the deal goes through, which is quite common in this day modern error of Wall Street.

    Second, the PPV numbers could be proprietary information that they may not be able to provide to lenders, unlike a court case where subpoena powers are involved, and oftentimes it still does not have to be revealed. This would be a big benefit to them when PPV numbers are down, but still hyped. It would also be a big boom when PPV numbers are good, but not as high as everyone thinks.

    Third, if you investigate banking for the last 30 years or even the last 5, in just about every state there has been scandals, corruption, and made-up-numbers with banks and lending to businesses.

    Heck, here is another one that just got revealed recently.

    http://capegazette.villagesoup.com/p/class-action-lawsuit-wilmington-trust-lied-to-shareholders/961364

    This bank used to be praised as an example of a bank doing things the right way when the 2008 economic collapse happened…

    Dave Meltzer is a scammer.

  12. Daw Johnson on February 12th, 2013 8:09 AM

    “1) Why are both sides focusing on the PPV aspect when the big difference in the deals seems to be the FOX vs. Spike thing?”

    That’s the narrative Dana’s using, but I really don’t see how that’s relevant.

    Unless UFC is giving Alvarez a cut of the money it gets from its FOX deal, the fact that a live FOX show might do more viewers than a show on Spike TV is meaningless. And Spike is comparable to FX (FX is in more homes, but UFC actually did bigger numbers for the most part on Spike) and way bigger than Fuel.

    Even beyond the fact that UFC would not necessarily guarantee a number of FOX fights for Alvarez, you can’t use the “more viewers = more star power” argument in this case, because Bellator’s obligation is to match the financials.

    The assumption is that more star power = a higher purse, but as long as Bellator will match UFC’s purse offer, it doesn’t matter if Alvarez’s star is smaller with Bellator than it would be with UFC.

    As for endorsements and all that, UFC might have more “ins,” but as long as Bellator has an endorsement policy at least as generous as UFC’s, that’s a moot point. And Bellator could even argue that as the face of its promotion, rather than just a guy in UFC (at least at first), he would have more opportunities to get lucrative sponsorships (a top sponsor would prefer GSP on a UFC show…on a Bellator show, Alvarez is higher on that priority list).

  13. Machiel Van on February 12th, 2013 9:52 AM

    Random Dude,

    I tried to find the images of Couture’s cashed checks, but couldn’t. Here’s a few articles that explain what information was on the checks/stubs:

    http://www.mmaweekly.com/ufc-disputes-coutures-claims-about-his-pay-2

    http://www.trickery.net/vb/archive/index.php/t-45711.html

    It’s probably the most detailed looks into a star’s pay in the UFC that’s ever been made public.

  14. BrainSmasher on February 12th, 2013 10:43 AM

    Go add Couture salary up. His contract is online for UFC 68. Look at the reported PPV buys and do the math. Then look at what the UFC confirmed paying him. That equals co firmed buy rates!

  15. Machiel Van on February 12th, 2013 12:53 PM

    Random Dude, here are some links to the Couture info. Couldn’t find the images of Couture’s paystubs though (though I’ve seen them several times):

    http://www.mmaweekly.com/ufc-disputes-coutures-claims-about-his-pay-2

    http://www.trickery.net/vb/archive/index.php/t-45711.html

  16. codemaster on February 13th, 2013 7:59 PM

    I believe the certification is merely a process to prove Meltzer’s bonafides as an expert witness regarding PPV buyrates.

    I don’t know why Meltzer is testifying, unless he is willing to divulge his sources–which he should know will be asked.

    If he is unwilling to divulge sources–the Bellator legal team will try to make hay of the fact–or lack of provable facts.

    But there is a fairly reasonable lower limit to PPV estimates. The UFC would not be in business if they averaged only 200 K per PPV. Fox wouldn’t have done a deal if their PPV numbers sucked–and you can bet Fox was told their PPV numbers.

    The court does not necessarily require precise figures–but only ball-park numbers to show that the Bellator claims do not hold water.

    Bellator is fighting a delaying action–they don’t mind losing–as long as the case takes a long time and causes a lot of pain to Alvarez and the UFC.

    As I have said before–I don’t believe this is a good tactic on Bellator’s part. The UFC and Bellator share a lot of fanbase–and MMA fans tend to dislike it when their favorite fighters get screwed by the big promotions. Bellator is an option for MMA fans, not a necessity–so Bellator would be wiser to walk and talk softer–at least until they are well-heeled enough to raid the UFC roster for talent. The current situation is a net-negative for Bellator/Spike/ViaCom with little to gain, and a lot to lose.

  17. felix on February 14th, 2013 5:08 AM

    I am not that sure codemaster,this being bad.

    Yes it might hurt Bellator PR wise,especially in short term.

    But i do think it is important for Bellator make sure that the process of stars leaving there organisation for the UFC is not an easy one. The need to make sure that when they offer generous terms to other fighters there continuety for the organisation is a little more certain then it currently is. If they only train fighters for greener pastures (what is currently happening) then there worth as an organisation to Viacom is significently diminished.

    I personally think they will have an incredible hard to try and get the PVV game working for themselves. I personally think they might try but the whole experience will be very short lived.

    So yes it is a unfortunate situation for all involved. But i think that unless the UFC pays Bellator some sort of (significent) renumeration Alvarez might have to stay with Bellator until his contract expires or they stop paying him.

  18. Random Dude on February 23rd, 2013 12:10 PM

    Those articles don’t prove Meltzer was correct in anything. You need to also post an article (unedited) that was publicly posted (not hidden only to his subscribers) that references 540,000 buys from Meltzer before this information was revealed.

    Meltzer is still a scammer. Still waiting for proof…

  19. codemaster on February 24th, 2013 10:58 AM

    @felix – I hear what you are saying, but my point is that MMA fans watch BOTH Bellator and UFC.

    Bellator has to realize that they get a sizable amount of audience from UFC fans–and fans hate when their favorite fighters are screwed by the promoters.

    The UFC made a huge mistake, IMO, in cutting top ten WW fighter Jon Ftich. Fitch has a less crowd-pleasing style–and a vocal minority complained vociferously about his style. But when the UFC caved and dropped Ftich–there was an earthquake among fans. There was no way to justify such a decision if the UFC was, as it claimed, a sport–and not fight entertainment.

    The decision to drop Fitch will be remembered–and it badly affected the credibility of MMA as a sport in many fan’s eyes.

    The Alvarez situation may look straightforward from a purely business perspective–if one ignores the promotional aspect of MMA. Perceptions in promotion are as close to reality as promotion can get. Bellator is perceived as screwing a fighter who helped build the promotion–and ths does not sit well with fans or with other fighters who may choose to fight for Bellator.

    I just don’t see the value Bellator gets from playing legal games with Alvarez when compared with the PR downside.

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