Top Rank files Second Amended Complaint against Haymon

October 31, 2015

Top Rank Boxing filed its Second Amended Complaint against Al Haymon and his assorted businesses on Friday in federal court in Los Angeles.  The third try at suing Haymon provides more detail about its allegations in hopes of surviving another attempt to dismiss its action.

The court granted Al Haymon’s Motion to Dismiss last month.  Our summary of the dismissal is here.

The Second Amended Complaint is more than double the original complaint in page length as it totals 105 pages.  The lawsuit sues Alan Haymon, Haymon Boxing , LLC, Haymon Sports, LLC, Hamon Holdings LLC and Alan Haymon Development, Inc.  It does not include Waddell & Reed Financial as the court determined in its previous ruling that suing this entity would be futile for Top Rank.  Top Rank accuses Waddell & Reed of bankrolling Haymon’s effort with PBC by “rigging the boxing industry.”  It cites the market of Championship-Caliber Boxers with which Top Rank challenges the purported monopoly in which Haymon, et al. control both the management and promotion of many of these boxers.  As has been discussed, the Antitrust theories of “tie-in (or out)” and “tying”

Similar to the first two, it claims that Haymon has violated Antitrust laws, Muhammad Ali Act and state business regulations.  Unlike the first two, it provides more detail including the names of boxers that allegedly rebuffed other promotions due to the fact that Haymon “managed” them.  It also cites how and where it obtained its information.  Mainly, Top Rank obtained the information for its complaint from various web sites as discovery in the lawsuit had not occurred.

Specifically, it names Deontay Wilder, Keith Thurman, Marcos Maidana, Adrien Broner, Lamont Peterson, Abner Mares and Errol Spence as fighters that Top Rank had “a reasonable probability of future economic benefit.”

Screenshot 2015-10-31 09.38.28

Screenshot 2015-10-31 09.38.46

As it did in the previous complaints, a check Instragrammed by Julio Cesar Chavez, Jr. after his fight with Andrzej Fonfara was included to show the blurring of business relationship. The check is from Haymon Sports, LLC to JCC for $1.75 million with the notes line stating: “Purse 4/18/15.” The assertion here, as it made in its prior complaints, is that payment of the purse is the promoter responsibility and not the job of a true manager. JCC removed the Instagram post, but it was too late.

Screenshot 2015-10-31 09.41.21

The complaint also embeds a tweet from boxing writer Dan Rafael as he reported Haymon boxer Charles Martin thanked “my promoter Al Haymon.”

Screenshot 2015-11-01 00.41.33

In dismissing Top Rank’s prior complaint, the court stated that Top Rank just showed one instance in which a promoter was blocked to make a fight with a Haymon managed fighter. In order to show that Haymon blocked promoters from fights, Top Rank names several fights that were prevented due to Haymon.

Screenshot 2015-11-01 00.41.17

In addition, Top Rank brings up a “modified form of payola” devised by Haymon when acting as an “illegal promoter.” This strategy is based on giving away content and airing it on as many networks as it can in order to exclude other promotions from airing on those networks. This short-term loss, according to Top Rank, is an effort to foreclose the market to others.

The lawsuit also describes the “sham” promoter scheme and the blocking of venues from access by Haymon.  These are similar to the previous claims by Top Rank.

Payout Perspective:

The more detail, the less likely Top Rank believes its lawsuit will get dismissed.  The lawsuit is a rehash of most of the claims it had in its previous lawsuits against Al Haymon and his businesses except it sets forth more specifics.  We shall see if the additional details shall help it sustain the lawsuit.  MMA Payout will keep you posted.

Hershman steps down as HBO president

October 30, 2015

Kevin Iole of Yahoo! Sports reports that HBO Sports President Ken Hershman is stepping down from his post.

Despite the fact that ratings were up and there seem to be suitable replacements for Manny Pacquiao, Hershman resigned abruptly on Friday.  Hershman replaced Ross Greenburg in 2012.  There was no announcement of Hershman’s replacement although SI’s Chris Mannix indicates that the replacement may come from within HBO.

The article indicates that Hershman is leaving without any pressure to depart and that he just “needed a break.”  Among the accomplishments under Hershman’s guidance, he was able to re-sign Canelo Alvarez from Showtime and bring Sergey Kovalev to the fold.

Despite the stiff competition from Premier Boxing Champions, HBO has held its own, up to this point.

Payout Perspective:

Hershman’s departure was a surprise and HBO will look to find a suitable replacement that can keep the momentum going.  Signing Andre Ward may be on the list of “to dos” for the next president.  In addition, the new head will need to provide a smooth transition from Manny Pacquiao to the next big boxing star.

Rousey hangs up on UFC media call after Browne question

October 30, 2015

Ronda Rousey hung up on a UFC Conference Call due to a question from a reporter about the fighter’s relationship with UFC Heavyweight Travis Browne.

The media conference call featuring Rousey, Holly Holm, Joanna Jedrzejczyk and Valerie Letourneau was held to promote UFC 193 on November 14th.

The question was from Marc Raimondi of MMA Fighting.  The question (around the 6:30 minute mark), which was in the first 7 minutes of the media call, Raimondi asked about Travis Browne’s recent announcement that they were in a relationship.  The operator on the call indicated that Rousey’s line was disconnected and they would try to call her back.  She did not return to the media call.

You may recall Browne is still married to his estranged wife.  This past July, his wife, Jenna Renee Webb, claimed that she was the victim of domestic violence caused by Browne.  He denied the allegations through his manager but was suspended by the UFC pending an investigation by the organization and was taken off of any scheduled appearances he was to make during International Fight Week.  In late August, Browne was reinstated by the UFC.

Based on Browne still being married and the accusations by Webb, one might conclude that Rousey dating the fighter would be bad for her public image.

Payout Perspective:

Fair or unfair to ask the question?  Browne did state publicly that they were in a relationship.  But, Rousey has not made any public comments about their relationship.  Since it is Rousey, her actions probably will be swept under the rug of her broad popularity.  Yet, the question about the question is if it is fair to ask Rousey about personal matters such as who she is dating.

Certainly, since she is a public figure, many things become fair game including who you are dating.  Moreover, Browne did make the statement publicly so there’s an actual reason for the question.  While you might argue it’s not the right venue to ask the question, the media access to fighters is minimal especially when they are preparing for a fight.  Thus, Raimondi saw an opening to ask and did what he thought was appropriate.  Will there be blowback by the UFC PR team?  Maybe.  But realistically, it was not like he asked the question based on an MMA web site rumor or from talking to “inside sources.”  Browne made the statement.  We shall see how this will be handled by Rousey’s handlers and what kind of PR treatment this will be given.

WWE reports Q3 results

October 29, 2015

The WWE announced its earnings for Q3 2015 on Thursday.  The company reported net income of $10.4 million ($0.14 per share) compared to a loss of $5.9 million ($0.08 loss per share) in Q3 last year.  The results bested most analyst expectations although the stock for the day dropped almost 13% as a result of profit taking.

Total revenue generated for the quarter ending September 30, 2015 were $492.6 million, up from $402.1 million the prior year period.  North America revenue were $373.6 million, up from $318.9 million from September 30, 2014.

The net revenues were $166.2 million at the end of the 3rd quarter as opposed to $120.2 million at the same time last year.

As for the WWE Network, it has about 1.3 million subscribers at the end of the quarter which is better than last year’s 515,000.  WWE CFO George Barrios indicated that the average for the WWE Network was 1,173,000.  At the end of Q3, the WWE Network had 1.233 million paid subscribers and 73,000 free subscribers as a result of the WWE’s rolling “free” months for new customers.  It’s up from the 1.15 million at the end of Q2 but down from 1.33 million at the end of Q1.  The Network revenues are up to $118.6 million.  Last year, at the end of Q3, they were $87.8 million.

The WWE plans to launch the network in Germany and Japan in January.  It also will be available on the Indian subcontinent on November 2.

According to the WWE press release, it has secured 37 new advertisers from the NBC Universal Upfront.

Vince McMahon touted the success of the reported earnings to the value from the WWE’s content.  He also emphasized the television rights deal and network revenue in attributing the international growth which was reported at 43% through the first 9 months of 2015.

Other notes from the earnings call:

Live events revenue increased 20% to $26.1 million from $21.8 million which related to 6 additional events and higher average ticket prices in North America.

Consumer products increased 21% to $22.4 million from $18.5 million in the prior year quarter.  WWE Shop showed an increase over last year’s third quarter as it was up to $6 million from $4.3 million in revenue.

Per Chris Harrington, the WWE barely touched on the ongoing concussion lawsuits only that there have been “increased legal expenses.”

The WWE introduced a 3 month subscription card at Walmart providing a “no credit card required” payment option.

There were 360,000 PPV buys equating to $4.5 million revenue for three events in Q3.  Thus, on average, despite the network about 120,000 households per event still purchase PPVs.

Payout Perspective:

The key takeaway might be that the WWE expects its WWE television rights fees and the growth of WWE Network subscribers will be the key drivers of WWE’s future revenue growth.  The WWE’s move to produce more live, original content for its Network is evidence that the company is investing heavy into its OTT platform as key for the future.  It’s interesting to note that the WWE did not address the reason for its “increased legal expenses.”  Then again, it’s likely that it did not want to make any comment on ongoing litigation.   Overall, the earnings report reflects a healthy company with earnings growth.

Lawsuit filed against World Series of Fighting looks like a sordid mess

October 29, 2015

A lawsuit filed this past Monday in federal court in Las Vegas by an assignee of rights against the World Series of Fighting may reveal some backstory about the inner workings behind the company.

The machinations of the lawsuit introduces the reader to a web of assignment of rights which related to keeping the World Series of Fighting afloat and expanding it internationally.  It involves a power struggle within the organization and a purported cover-up relating to WSOF’s matchmaker pulling dual time as promoter/manager and a violation of commission rules.  The lawsuit is being brought by WSOF Asia, an entity which claims to have the rights to the WSOF trademark outside the United States as well as the distribution rights for the organization outside of America. WSOF Asia, Limited, a Hong Kong Limited Liability Corporation (“LLC”).

The complaint alleges that Shawn Lampman founded WSOF in 2011.  Lampman has his own legal problems but that’s beside the point here.  The WSOF entity is a Nevada LLC known as “MMAWC” according to court documents but operating under the WSOF name.  The filing paints a picture of desperation for a fledgling MMA organization in need of an infusion of money.  A loan and investment of $700,000 was made in October 2012.  One of the investors was Vincent Hesser.

In exchange for the loan, the WSOF negotiated licensing rights and its trademark “WSOF” to Hesser.  A part of the deal also included an assignment to pursue any international expansion branding opportunities for a term of 60 months (i.e., 5 years)  Hesser had contacts in Asia that could have led to the expansion of the brand per the complaint.  In turn, Hesser assigned his rights to an entity named Royal Union Trust for the region of Asia.  Royal Union Trust then assigned its rights to WSOF Asia, the plaintiff.

Interesting enough, the allegation that Abdel Aziz is violating the rule that a promoter cannot also be a manager almost takes a backseat to some of the more serious allegations within the lawsuit.  Abdel Aziz and WSOF CEO Carlos Silva are named defendants in the lawsuit.  Silva was appointed CEO this past July.

The lawsuit claims that WSOF breached its contract with WSOF Asia as Hesser entered into an assignment agreement with WSOF but the MMAWC entity claims to have repudiated the agreement.  Hesser claims in the lawsuit that he and “his assigns” (i.e., the people he assigned the rights to) spent $200,000 in out of pocket expenses to build the WSOF brand overseas.

It is requesting a declaratory judgment validating the assignment of rights to WSOF Asia.  In addition, money damages in excess of $75,000, costs and attorney fees.

WSOF Lawsuit

Payout Perspective:

Notably, the WSOF renewed an agreement with IMG for media distribution rights which may conflict with the alleged assignment by the plaintiff.

The lawsuit will be a sordid mess if it gets past a Motion to Dismiss which is likely to be brought by MMAWC and the defendants.  The lawsuit boils down to various assignments of assets in order to infuse WSOF with capital and build the brand.  Among the many questions will be who had control and authority over WSOF and when they had it.  The central question will be whether there was an assignment of rights and were the assignments valid per the terms of the contract.  The lawsuit might reveal the inner struggles of a startup looking for capital.  MMA Payout will keep you posted.

UFC considering naming rights deal for new arena per report

October 28, 2015

A report from the CBS affiliate in Las Vegas states that the UFC is considering a naming rights deal with the new arena being built near the New York, New York.

It is proposed that the arena owned by AEG and MGM will be the home to a future National Hockey League team.  It will host UFC 200 this July as well as host concerts and other events.

Naming rights for the arena are still up in the air but the report states that a decision could be made “in the next two weeks.”  Note, that the report was somewhat unclear whether a naming rights deal would be confirmed in the next two weeks or whether the UFC would decide on making an offer in the next two weeks.

Payout Perspective:

Would the return on investment make sense for the company?  There are a lot of studies out there that conclude that naming rights do not have a direct impact on profitability or brand equity.  The UFC is determining if the naming rights deal makes financial sense.  Assuming an NHL team is awarded to Las Vegas, the UFC name would be mentioned each time the team plays in the arena.  Also, it would be the home to all UFC events in Vegas.  Would the local company see the investment in naming rights a contribution to the business community and a sign of goodwill?

Nevada State Athletic Commission and Nick Diaz in settlement talks

October 28, 2015

MMA Fighting reports that representatives for Nick Diaz and the Nevada State Athletic Commission are discussion a potential settlement of his fine and punishment issued last month.

Sources told MMA Fighting that with settlement talks ongoing, Diaz could be back in the Octagon by 2016.  Amy Dardashtian also indicated that the best case scenario is that he is in the Octagon as early as this summer.

Last month, the commission issued a 5 year suspension and fined Diaz $165,000 for failing a drug test for marijuana at UFC 183.  The contentious hearing drew the ire of many fans which felt that Diaz was wrongly prosecuted and unfairly penalized.  Diaz’s lawyers stated that they would file a lawsuit against the NSAC seeking judicial review.  Notably, the NSAC never issued a written finding of Diaz’s suspension and fine per NSAC rules.  Only after the written order is issued and sent to Diaz’s representations could his lawyers file suit.

Interesting enough, Las Vegas law firm Campbell & Williams stepped in on the fighter’s behalf per a twitter post by Diaz.

Campbell & Williams represents the UFC in a variety of matters.  It is the law firm that is representing the UFC in the Wanderlei Silva defamation case.

Payout Perspective:

Clearly, the local influence of Campbell & Williams must have facilitated settlement talks.  Further, the fact that no written order was issued meant that no legal action would be pursued.  I would have to check the NSAC rules to see if there was a time limit for which they needed to issue an order.  Perhaps the NSAC did not figure that the Diaz penalty would have caused such a stir within the MMA community.  But, in the end, we should probably see the sides settle with the proviso that Diaz is able to participate in the Octagon sooner than later.

GLORY CEO issues statement on promotion leaving Spike TV

October 27, 2015

MMA Payout has obtained a comment by GLORY CEO John Franklin with respect to the MMA Fighting report this morning that GLORY Kickboxing would no longer be seen on Spike TV.

GLORY CEO John Franklin:

Spike was a solid platform to introduce GLORY and kickboxing as a whole in the US. We of course leave the door open to working with Spike again, but for right now, the fit isn’t perfect.

GLORY needs a partnership with a dedicated sports broadcaster, an established destination for the world’s greatest athletic events.  With more original content, shoulder programming, and a view to brand building for the organization and our athletes coming up, GLORY will be able to take its next step as a global sports property.

We want to elevate the sport further and moving from a men’s entertainment network to a dedicated sports network with broadcast affiliates will best serve this goal.

Since we began, GLORY has delivered the most exciting stand-up fighting available and our fans worldwide will not miss that opportunity. Our next card, GLORY 25 Milan will air on US television, as will every card after that. We’ll have an update on where to watch shortly. Stay tuned.

Crawford and GGG replay draw 1.07M avg on HBO Saturday

October 27, 2015

ESPN’s Dan Rafael reports the ratings from Saturday night’s HBO event featuring Terrence Crawford.  The replay which drew an average subscriber audience of 1.07M viewers also included the GGG-David Lemieux PPV replay.

The overall event on HBO Saturday night from 9:30 to approximately midnight ET (first showing) peaked at 1.2M viewers.  The replay of GGG-Lemieux drew 797,000 subscribers with a peak of slightly over 1M viewers.  The Roman Gonzalez-Brian Viloria replay drew 505,000 viewers peaking at 685,000.

According to Sports TV Ratings, the Texas A&M-Ole Miss game drew 2.77M viewers on ESPN from approximately 7-10:51pm ET.  It was the most watched sporting event on cable Saturday night.

Payout Perspective:

The event featured Terrence Crawford taking on Dierry Jean which had the overall peak viewership for the 2.5 hour event on HBO.  Notably, it was followed by a “2 days: Canelo Alvarez” which was shoulder programming for Canelo’s fight against Miguel Cotto next month.  The GGG-Lemieux replay was below what GGG averages with his live fights on HBO.

GGG Fights on HBO

November 2013 vs. Curtis Stevens 1.41M viewers (fight only)

July 2104 vs. Daniel Geale 984,000 viewers (overall show drew 758,000)

October 2014 vs. Marco Antonio Rubio 1.3M viewers (fight only)

February 2015 vs. Martin Murray 862,000 viewers (fight only)

May 2015 vs. Willie Monroe, Jr., 1.338M viewers (fight only)

GLORY-SpikeTV part ways

October 27, 2015

MMA Fighting’s Luke Thomas reports that GLORY Kickboxing will no longer be seen on SpikeTV. The promotion’s run which started in November 2013, has come to an end.

The decision to end the relationship was not sudden according to the report as the two sides had been in talks, but it appears that each has allowed the contractual terms to air Glory on Spike TV to end.

Along with PBC and Bellator, GLORY Kickboxing was to be one of the anchors for Friday night combat sports on the network as Spike branded the trio, “Friday Night Lights Out.”  The programming has had mixed results since its inception this past March.

One might look to the sagging ratings as a reason that the network and the promotion have split ways.

Glory Ratings on Spike
Glory 11 381,000
Glory 12 476,000
Glory 13 659,000
Glory 14 495,000
Glory 15 354,000
Glory 16 498,000
Glory 17 487,000
Glory 18 352,000
Glory 19 542,000
Glory 20 359,000
Glory 21 488,000
Glory 22 152,000
Glory 23 295,000

Glory 23

MMA Payout has reached out to representatives from GLORY and will update this report if and when it becomes available.

Payout Perspective:

Ratings just did not pick up for the kickboxing organization.  Even the joint show with Bellator this past September did not give much of a boost for GLORY.  In fact, there was speculation that Bellator did not help Glory enough with the promotion of its fights on the Dynamite 1 card.  Looking at the ratings on the network, there was no signs of improvement.  GLORY’s next show will be seen on its web site.  In the past, it had aired on CBS Sports Network but as of now there are no US TV deals in the offing for the company.

Next Page »