Nike files lawsuit over Venum name

February 19, 2014

The Beaverton, Oregon based sports gear maker Nike filed a lawsuit against MMA sportswear brand Venum last month alleging trademark infringement and other violations of trademark law.  The lawsuit filed in the U.S. District Court of Oregon claims that Venum’s mark infringes a previously filed Nike-owned trademark, Venom.

Nike sued DBV Distribution, Inc. and Dragon Bleu, Sarl (“Dragon Bleu”), the owner of Venum, in early January stemming from the MMA brand’s use of the “Venum” trademark.  The Complaint claims that Nike has owned the “Venom” trademark since 2002.  The mark, according to the Beaverton, Oregon company, has been used in connection with athletic apparel and equipment since at least 2002.  It has depictions of the purported infringement included in the Complaint including a bat, bat bag and apparel which is associated with Kobe Bryant shirts, shorts and warm-ups.  It also includes “Venom” women’s sportswear.

Nike claims that the “unlawful activity” stemmed from Venum selling athletic apparel and equipment on its Venum web site and also http://www.dragonbleu.fr.  Nike alleges that Venum “intentionally attempt to draw associations.”  One of its arguments is that Venum offered Nike boxing shoes on its Dragon Bleu web site.

The lawsuit filed in Oregon District Court also brings up that the U.S. Trademark Office initially refused registration of the “Venum” mark due to the “Venom” trademark.  Dragon Bleu argued that there is no “likelihood of confusion.”  At the time, the “Venom” mark was in connection with “ski and snowboard gear” whereas “Venum” related to MMA sportswear thus the assertion was there could be no confusion.  To buttress its argument, it cited that other “Venom” marks were allowed which related to sporting goods but were readily distinguishable due to the fact that they were associated with different sports.  The Trademark Office agreed and granted it the “Venum” mark.

The legal quarrels may have begun due to Dragon Bleu suing Nike in France in November 2013 seeking a preliminary injunction for an alleged infringement by the swoosh for a soccer boot it called, “Hypervenom.”  This was brought up by Nike in its Complaint against Dragon Bleu.  Nike claimed that in that lawsuit, Venum argued that the Venum mark and the “Hypervenom” mark were “practically identical and that consumers are likely to be confused by Nike’s use of Hypervenom.’”  Nike asserts that its Hypervenum trademark and Venum trademark can “co-exist in Europe without any likelihood of confusion.”

Nike argues that Venum cannot have it both ways in opposing Nike’s Hypervenom soccer boot infringes its brand but then “argue their use of VENUM on apparel and equipment for mixed martial arts and related sports in the United States does not infringe Nike’s VENOM marks in the United States.”

Nike is requesting that the Court ordering the Cancellation of the Venum trademark and destruction of all infringing products.

Venum’s counsel filed its Answer to Nike’s Complaint on February 10, 2013.  Notably, Venum admits that it sold authentic Nike products on its Dragon Bleu web site.  Aside from this admission, the answer was standard.

As a sidenote, Venum’s counsel previously served as in-house at Adidas.  No correlation or insinuation here, just an interesting tidbit.

(H/t: MMA Mania)

Payout Perspective:

While it may be a viable assertion to believe that Nike’s lawsuit is a way to get Venum out of the UFC marketplace just in time for UFC uniforms, I would contend that this is not the reason.

As explained here, it’s likely that Nike would like to market its “Hypervenom” brand of soccer boot.  With the World Cup happening this June, it would behoove Nike to market these shoes before, during and immediately after the event in Brazil.  If it could broker a settlement with Venum for use of the “Hypervenom” mark in Europe, it’s likely that this lawsuit goes away.

The one big issue question that I had was why did Dragon Bleu sell Nike gear on its web site?  If we assume it received this from a Nike supplier one would think Nike would eventually find this out.  Knowing that Nike had a filed for the “Venom” mark prior to its filing, and had to respond to an office action regarding the “Venum” mark it should have been put on notice of possible issues.  Of course, filing a lawsuit against Nike last November may have drawn Nike’s ire as well.

We shall see whether this lawsuit goes away as quickly as it came.  MMA Payout will keep you posted.

UFC Fight Night 36: 1.4 million viewers

February 19, 2014

MMA Payout has learned from Nielsen sources that Saturday’s UFC Fight Night 36 received an average viewership of 1.4 million viewers.  The show which aired at 7:30pm PT/10:30 ET is the biggest rating for a Fight Night on FS1 since UFC Fight Night 26 on the first day of the network.

UFC Fight Nights on FS1

UFC Fight Night 26               1,780,000

UFC Fight Night 27               824,000

UFC Fight Night 28               539,000

UFC Fight Night 29               638,000

UFC Fight Night 30               122,000

UFC Fight Night 31               641,000

UFC Fight Night 32               722,000

UFC Fight Night 33               755,000

UFC Fight Night 34               Fight Pass

UFC Fight Night 35               629,000

UFC Fight Night 36               1,400,000

Payout Perspective:

Although it was not the most exciting of Fight Nights, the 1.4 million viewers marks the biggest viewership since UFC FN 36.  The ratings are a positive considering it went up against the Olympics and NBA All Star Saturday Night on TNT for a portion of the night.  The annual NBA celebration scored an average of 5.7 million viewers with its peak during Fight Night (at 7:45pm/10:45pm quarter hour with 6.7 million viewers).  NASCAR on FS1 was a lead-in for the UFC which averaged 3.5 million viewers.  So, there was a considerable drop off between the NASCAR and the UFC event but for the UFC this should be seen as positive numbers as this was a Brazilian card which usually does not do well in terms of viewership.

Rousey against testing for marijuana

February 18, 2014

MMA Junkie reports on Ronda Rousey’s opinion on the testing of marijuana on fighters.  Although Rousey believes that marijuana is an “invasion of privacy” it is actually not.

The women’s bantamweight champ told MMA Junkie, “It is beyond their [state athletic commissions/sanctioning bodies] rights [to test for marijuana],” Rousey said. “It’s actually an invasion of privacy.”

Rousey, who will main event UFC 170 this Saturday was asked the question about marijuana in the sport after UFC women’s fighter Jessica Eye tested positive for marijuana.  Eye’s positive test and subsequent mangling of the situation is a public relations case study.  Rousey believes that marijuana is not a performance enhancer and should not be tested.  Regardless of Rousey’s opinion, she is required by commissions in the states and sanctioning bodies where the UFC holds events to submit to a drug test.

A sample portion of a UFC contract under the “Fighter’s Conduct” section:

8.5  Fighter shall not use any controlled or banned substance, including but not limited to marijuana, cocaine, metamphetamine, steroids, human growth hormone or any similar drugs or blood doping techniques (each a “Controlled Substances, and Fighter agrees to submit to any pre-Bout or post-Bout drug test as requested by an Athletic Commission.  Fighter shall be deemed to be in breach of this Section if Fighter tests positive for any Controlled Substance in any pre-Bout or post-Bout drug test.

We do not know for sure that this paragraph is in Rousey’s contract, but one would think it’s unlikely that this would be negotiated out of a contract.  Even if this language is not in her actual contract, we may assume that something like this would be included.

Payout Perspective:

The fighters are subject to the rules of the athletic commission and/or sanctioning bodies and even though social perceptions on marijuana have changed and two states have legalized marijuana it is still considered a banned substance that will be tested.  In fact, the two UFC events in Washington state where marijuana is legal, the Washington State Department of Licensing (the state agency overseeing boxing/MMA and wrestling) tested UFC fighters for marijuana.

As for the “invasion of privacy” comment, this is not correct.  The fighters agree to be tested by the various sanctioning bodies and most, if not all, test for marijuana.  If this is to change, someone would have to lobby for the stop to marijuana testing.  Perhaps Rousey is speaking out in hopes of gaining some traction with other fighters to lobby against this testing.  Until then, marijuana will still be tested and will be subject to penalty.

More on Melendez to Bellator story

February 18, 2014

MMA Fighting’s Dave Meltzer has more information on the evolving Gilbert Melendez to Bellator story which brings up some interesting questions about the future of business for Bellator and the UFC.

Meltzer also indicated on his weekly Wrestling Observer podcast (subscription required) that a definitive answer on whether the UFC will match Bellator’s offer to Melendez will occur sometime in mid-March.  Based on a previous standard fighter contract proposed to Eddie Alvarez, the UFC’s opportunity to match is 15 days.  Thus, if we assume that Melendez was offered the contract around the day news broke, the UFC would have by the end of February/early March to match the contract offered by Bellator.  It could even mean that Bellator could have a big announcement when it returns to Spike TV on Friday, February 28th.

In the MMA Fighting article, Rebney indicated that “this wouldn’t be the last time something like this would happen.”  Bellator plans on attempting to go after fighters when they are “legally allowed to,” according to Rebney.

Rebney indicated the Melendez contract is a multi-fight deal which also includes a PPV upside as well as other opportunities outside of the ring.

If the UFC decides not to match, Melendez could be in a Bellator ring as soon as this spring.

Payout Perspective:

It will be interesting to see what the UFC does as to whether or not match Bellator’s offer.  The Melendez offer invokes the UFC’s “right to match” clause in its fighter contracts which unveils a new battle between Bellator and the UFC.  Bellator may begin to put pressure on the UFC when it comes to re-signing its talent causing the UFC to make a business decision on how much a fighter is worth to its company.  It would also mean the UFC has less leverage over the free agent fighter.  The move would mean that Bellator is willing to open up its checkbook to sign top-flight fighters whereas it had not done so in the past.

From Bellator’s perspective, signing Melendez may be a gamble if he does not produce immediately.  If Melendez were to be upset (e.g., King Mo) in his debut with Bellator, the acquisition will appear to be a bust.  Moreover, whether to put Melendez in the lightweight tournament is another question.  Bellator’s tournament model is a staple of the organization and it’s not clear whether Melendez will be placed in it as there may be some risk of him losing before the big payoff of facing the LW champ.

It appears that the future is a PPV fight with Eddie Alvarez assuming everything falls in place.  This would mean that Bellator would be making amendments to its usual tournament style in order to appease an incoming fighter and ensure its investment is not tarnished by an unfortunate upset.

The Wrestling Post – 02.17.14

February 17, 2014

Welcome to another edition of The Wrestling Post.  In this post we talk about the looming WWE TV rights fee deal and a new toy deal for the company.

Exclusive rights period ends between WWE-NBC Universal

Friday was the last day for the exclusive negotiating period between the WWE and NBC Universal to come up with a deal for the WWE’s television rights.  The WWE’s existing contract with NBCU ends this fall and the organization hopes to improve upon its current $139.5 million television licensing fees for its stable of WWE shows.

Although it identifies itself as a sports entertainment company, it hopes to score a television deal that mirrors some of the recent sports television rights fees contracts.  The most recent sports rights fee deal had CBS earning the right to 8 NFL Thursday night games throughout the regular season for $250 million according to the NY Times.   Notably, the NFL did not give up exclusivity as the games aired on CBS will also be available on the NFL Network.  Many believe that the rights fee deal could rival the NASCAR deal which drew a total of $820 million over 10 years from Fox and NBC.  Others believe that it may be able to double its current fees whish would still be a great improvement.  WWE stock has gone up in the past month as it is trading in the $20 dollar range – a benchmark never seen by the company since it went public.  This is due in part to the hedging that the rights deal will break the bank.

Payout Take: Losing exclusivity to deal with the WWE was a likely scenario as the WWE wants to field offers from others.  We should see by the end of February where the WWE may land.  It still could end up with NBCU but for a bigger price tag.

WWE-Mattel ink new deal

Variety reports that the WWE and Mattel have entered into 5 year agreement for Mattel to be the primary toymaker for the company.  The agreement will go through 2019 and will encompass toys and video games.

Notably, the WWE obtained the trademark for CM Punk late last year for use in toys, action figures, dolls, etc. The WWE has had the use of the CM Punk mark for wrestling since 2009 and for use of clothing since 2011.  It filed for the Daniel Bryan trademark for use with toys last week.

Payout Take:  The deal is an example of how the WWE’s choice to more PG content has aided its business outside of the wrestling ring.  Without the move to more family friendly content, it would not have landed Mattel.  If you were wondering, if the rumors are true that CM Punk is gone from the WWE and Phil Brooks decides to wrestle again somewhere, he’d have to use his own name or else be subject to a lawsuit from the WWE.

UFC Fight Night 36 attendance and bonuses

February 17, 2014

MMA Junkie reports the attendance and bonuses for Saturday’s UFC Fight Night 36 which took place at Arena Jaragua in Jaragua do Sul, Santa Catarina, Brazil.

The fighters grabbing the newly restructured bonuses received $50,000 each:

Fight of the Night:  Lyoto Machida-Gegard Mousasi

Performances of the Night: Erick Silva and Charles Oliveira.

Junkie also reported the announced attendance at 7,511 which is slightly less than its last event held May 2013. UFC on FX8 featuring Vitor Belfort against Luke Rockhold received an attendance of 7,642.

Payout Perspective:

Although the new structure of bonuses did not have to include a KO or submission it included the two fights on the card which did not go to decision.  Silva was the lone stoppage via punches and Oliveira was the only submission of the night.  There were mixed feelings on the FOTN as some did not believe it rose to being the best fight of the night.  In all, it was a long night with a lot of fights that were not memorable.

UFC contemplates fighter uniforms

February 15, 2014

The UFC announced this week that it intends to have its fighters wear uniforms in the Octagon.  Although nothing is official, multiple sources are reporting that the UFC has spoken with a major athletic apparel company regarding fitting its fighters for uniform to wear in the Octagon.

The deal will dress the fighters including hats, walkout shirts and fight shorts.  The fighters will be allowed panels on their person where they may obtain other sponsors.

The uniforms appear to be the UFC response to addressing the disparity in fighter sponsorships – something Dana White indicated he wanted to fix.  Notably, Cole Miller had expressed discontent with sponsors.  Chris Carmozzi called for an end to lowball offers from potential sponsors on his blog.  Mac Danzig had gone so far as to decline sponsors for his fight on network television.

We will see if the uniforms will be similar to what we see on TUF  (with less emphasis on the athletic company logo) or will we see some other design.

(H/T:  Bloody Elbow via Bleacher Report)

Payout Perspective:

This will be an interesting story to follow as this deal will be lucrative from the UFC’s standpoint as it essentially brokers a sponsorship deal for it while seemingly solve sponsorship issues with some of the lower tier fighters.  It’s not clear how the deal does away with lowball offers from sponsors although the details have yet to be released.

A good question to ask is if there is limited space for sponsors on the new UFC uniform, how many companies would be willing to invest.  The new uniform may also minimize the need for fighter representation.  Rather than find deals for its fighters, managers and agents will have less of a role in this area and must show value to their client in other ways.

TUF Nations Episode 5: 187,000

February 15, 2014

MMA Payout has learned from Nielsen sources that the fifth episode of TUF Nations on FS1 received an average viewership of just 187,000 viewers.

TUF Nations: Australia vs. Canada

Episode 1:  371,000 viewers

Episode 2:  253,000 viewers

Episode 3:  107,000 viewers

Episode 4:  384,000 viewers

Episode 5: 187,000 viewers

Payout Perspective:

This week’s episode represents almost a 50% drop in average viewership.  This is interesting considering that the controversy surrounding Tyler Manawaroa did not move the dial.  In fact, less people were interested.  This may be due in part to the Winter Olympics which earned an average viewership of 20.8 million on Wednesday night albeit the Olympic ratings were the lowest of the Sochi Games.

Gilbert Melendez signs with Bellator, UFC maintains matching rights

February 14, 2014

We wrote yesterday about the rocky contract negotiations between Gilbert Melendez (22-3, 1-1 UFC) and the UFC.  Today, Bellator shocked the MMA landscape by announcing a multi-fight deal with one of the best lightweights in the world in Melendez, though the UFC currently maintains matching rights.

Bellatormainlogo

 

Gilbert Melendez sits atop the UFC’s lightweight division. With victories over Josh Thomson, Diego Sanchez, Shinya Aoki and Jorge Masvidal, “El Nino” is ready for a new crop of challengers as the Santa Ana native has agreed to a multi-fight, multi-year deal structure with Bellator that can pit Melendez against some of MMA’s best, including Eddie Alvarez, Michael Chandler, Will Brooks, Dave Jansen and a host of top lightweights from around the world.
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“The moment Gil was legally able to explore the free agent market, Gil’s management team reached out to me and we began figuring out how to bring Gil to Bellator,” said Bellator Chairman & CEO Bjorn Rebney. “It’s no secret that I’ve been a big “El Nino” fan for many years. Gil was one of the first fighters I tried to sign when I launched Bellator back in 2008, and he’s grown and developed into one of the best and most exciting lightweights on earth.  Gil has a vision for what he wants to accomplish both inside and outside the cage and we can help make his vision a reality.  We are in the business of developing and showcasing the greatest fighters on earth. That’s what we intend to do here with Gil and it’s what we’ll continue to do in the future.”
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The UFC currently holds matching rights on Melendez.

 

Payout Perspective:

Bellator’s announcement today was pretty shocking and caught many in the MMA landscape off-guard.  Nevertheless, it’s a key strategic move for Melendez, who is trying to maximize his market value.  This is a classic example of pinning bidder A versus bidder B, and illustrates the importance of having more than just one key player in the MMA landscape for fighters.  Whether Melendez ends up in Bellator or UFC matches Bellator’s pay and signs back with the promotion, it will be a win/win for Melendez in the short run.

In the long run, for a fighter who is as exciting as Melendez, you risk making a choice that may seem near-sighted, and could miss out on potential fight of the night or performance bonuses in addition to base pay, which could end up surpassing Bellator’s proposed pay. Although the exact numbers of the deal are not available at this time, MMAPayout will report them as they become available.

Winning a title and getting a push from the UFC is invaluable for a fighter, but Bellator will do their best to match the same benefits as they tried to do with with Eddie Alvarez, such as offering exposure on Spike TV, featured in a potential PPV down the line against either Eddie Alvarez or Mike Chandler, two of the best lightweights in the world, and certainly other Viacom opportunities.

The ball is now in the UFC’s court, and it’s up to them to determine if they want to retain Melendez and match what Bellator is offering or let him walk away to a competitor.

UFC announces TUF Latin America

February 14, 2014

MMA Junkie reports that the next TUF series will feature fighters from Latin America.  The news was announced on Thursday afternoon.

The UFC will be accepting applications and eligible candidates must speak Spanish, have a minimum of 3 pro MMA fights and have a winning record.  In order to appeal to the Latin American audience the UFC will require they be citizens of one of the following countries: Argentina, Belize, Bolivia, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Haiti, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, Uruguay or Venezuela.

No other details have been released regarding weight divisions and coaches.  The show will begin taping later this year.

Payout Perspective:

The announcement is part of the UFC’s standard strategy when setting a footprint in a new market.  Although the TUF franchise has become tired here in America, the show is a good sample for prospective MMA fans.  It will be interesting to see if it will appear on the prospective subscription based Televisa channel in Latin America.   The Latin American market is important for the UFC as it hopes to continue to develop a global following.  It had hoped for an event in Mexico which would feature Cain Velasquez although this has been put aside for now due to Cain’s injury.

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