Zuffa files Reply Brief in Motion to Transfer Venue

April 29, 2015

Zuffa has filed its Reply Brief in response to the Plaintiffs’ Opposition to Zuffa’s Motion to Transfer the Venue.  Predictably, the big issue will be whether or not the fighter contracts which avail them to the Nevada should be interpreted by the Court.

In its Motion to Transfer Venue from San Jose to Las Vegas, Zuffa lawyers argued that the fighters that filed suit against Zuffa executed contracts or bout agreements which availed themselves to Nevada or Las Vegas as the fora for which a lawsuit would arise.  There are variations within the contractual language of the plaintiffs but the gist is that the contract limits lawsuits to Nevada.

The Plaintiffs argued in its opposition that the contracts were not at issue and need not be interpreted to adjudicate this matter.  Thus, the forum selection clause dictating forum were inapplicable.

In its Reply Brief, Zuffa argues that a “crucial component” of Plaintiffs’ case is that Zuffa’s contracts improperly restrict competition.  Thus, at some point, this will need to be demonstrated through “specific terms of the contracts” and how it illegally bars completion.  It contends that Plaintiffs cannot just show market share or a disparity of purses but through fighter contracts.  Moreover, it opposes Plaintiffs’ interpretation of the contracts that they impose perpetual and indefinite terms on athletes.

Zuffa cites the Ninth Circuit case of Simula, Inc. v. Autoliv, Inc. which it argues is binding authority.  Zuffa argues that Simula advises that when a plaintiff argues antitrust claims which have anticompetitive effects, the contracts must be interpreted.  In that case, the Court determined whether an arbitration provision in a contract should be followed.  In addition, it determined that with antitrust claims under Sherman Act 1 and 2, the Court would have to evaluate an agreement between the parties.

As Zuffa argument goes, since the contracts will need to be evaluated, Nevada would be the proper forum since it would be “more familiar” with the governing law.  It also argues that since the plaintiffs contend that this is a nationwide class action, the relevancy of the location main class representative is not relevant.  Thus, it rebuts the argument that Le and others live in Northern California since the lawsuit alleges to be a nationwide class action.  It also contends that the residence of the plaintiffs is “substantially diminished” when the plaintiff’s venue choice is not its residence.  This would be the case, as pointed out by Zuffa, by plaintiffs such as Brandon Vera and Gabe Ruediger.

As for Plaintiffs suggestion that San Jose is more expeditious to trial and has handled more Antitrust cases, Zuffa summarily dismisses these contention citing they are not elements in determining a motion to transfer venue.  It also argues that there is not a strong local interest in the underlying litigation.

The hearing on the Motion to Transfer Venue will be held in San Jose on May 7th.

Payout Perspective:

It will be interesting to see how the court addresses and interprets the Simula case.  While the case does point out that it needed to look at the underlying agreement when deciphering an antitrust case, the main issue there was whether an arbitration provision found in the contract applied to the dispute.  Thus, the case hinged on whether or not there should be a stay of the lawsuit pending an arbitration or whether that case should be dismissed in its entirety.  The point being is that the court did not necessarily decide whether a forum selection clause bound the parties to the contractual provision when the lawsuit is premised upon anticompetitive behavior of a party (i.e. antitrust claims).  This is just a cursory look at the Simula case and certainly plaintiffs’ lawyers will analyze the case and make its own distinctions.   This is the last filing before the hearing next week so we shall see what arguments are presented by plaintiffs to rebut these assertions.  MMA Payout will keep you posted.

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