WWE gets big win in head injury lawsuits brought by former wrestlers

March 25, 2016

Earlier this week, the U.S. District Court of Connecticut dismissed a portion of the claims of several WWE wrestlers which claimed the company knew or should have known about head injuries.  Only one claim by two plaintiffs remains.

In a lengthy opinion, the court dismissed the lawsuits of William Albert “Billy Jack” Haynes III, “Big” Russ McCullough, Ryan Sakoda and Matthew R. Weise.  However, one claim in the lawsuit of Evan Singleton and Vito LoGrasso remain with respect to “fraudulent omission” stemming from information post-2005.  The claim was whether the “WWE became aware of and failed to disclose to its wrestlers information concerning a link between repeated head trauma and permanent degenerative neurological conditions as well as specialized knowledge concerning the possibility that its wrestlers could be exposed to a greater risk for such conditions.”

The former wrestlers had filed lawsuits in different jurisdictions but the WWE filed motions to transfer the venue to Connecticut and were granted the relief each time.  Once the lawsuits were transferred to Connecticut, the state of the headquarters of World Wrestling Entertainment, the company filed motions to dismiss the wrestler’s complaints citing that they were time-barred by the applicable Connecticut statutes of limitations and repose.

The court dismissed the wrestlers’ negligence counts under Connecticut law.  It also dismissed misrepresentation and fraudulent deceit claims as the plaintiffs failed to identify with specificity any false representation by WWE.  In addition, the fraudulent concealment and medical monitoring claims were also dismissed.  However, the court did not dismiss the “fraudulent omission” claims by Singleton and LoGrasso.

Notably, the plaintiffs argued that their case was similar to that of NHL players that brought a concussion lawsuit against the league.  In that case, the judge allowed a “fraudulent omission” claim under similar circumstances.

The court indicated that the facts concerning the “fraudulent omission” claim would proceed as both wrestlers were active in the WWE on or after 2005.  The plaintiffs will still need to establish facts after more discovery occurs in the lawsuit.

Payout Perspective:

The plaintiffs might appeal although the court opinion was quite thorough.  The strategy to move the lawsuits to Connecticut and rely on Connecticut law worked in the WWE’s favor.  Every wrestler, except for Haynes had a forum selection clause in their contract which made the decision easier to transfer the cases.  We saw a similar situation in the UFC Antitrust Lawsuit where the fighters were sent to Las Vegas from San Jose due in part to the forum selection clauses in the contracts.

The WWE is left with a narrow cause of action against it which may mean the possibility of a settlement.  Of course, the court seems to leave open the possibility that after further discovery occurs, if the plaintiffs cannot establish facts for its case, a motion for summary judgment may be filed by the WWE.  We will keep you posted.

UFC announces Harley renewal, Military Benefits Program

March 24, 2016

The UFC has formally announced its renewed partnership with Harley Davidson today via company press release.  The partnership features a new Military Benefits Program targeting those in the military.

The announcement was first made by the Sports Business Journal last month.

The press release issued today also notes a new Military Benefits Program:

In conjunction with the extension, both global companies jointly announce a new military platform to offer exclusive benefits to active armed services personnel and veterans. Military men and women, both active and non-active, will be able to access unprecedented offers, including: discounted tickets at select events, discounted subscriptions to UFC FIGHT PASS, fight week meet and greet opportunities with UFC athletes and personalities, entry to invite-only viewing parties and discounted passes to the annual UFC Fan Expo® during International Fight Week. In addition to this program, Harley will continue to offer its free riding academy services to military personnel and first responders.

Payout Perspective:

The Military Benefits Program is an interesting one that targets a key demo for the UFC and Harley Davidson.  The combination of UFC discounted offers for military as well as the inclusion of the Harley Davidson free riding program and showing PPVs at local dealers are a good way to bring in potential customers.

Bellator and WSOF support NY vote

March 23, 2016

In addition to the UFC’s statement of support with the news late Tuesday that the New York State Assembly passed the measure to legalize MMA in New York, Bellator and the World Series of Fighting have issued their own statements.

Scott Coker via Bellator press release:

“The New York Assembly’s vote to legalize MMA is a watershed moment for this incredible sport. As someone who has been promoting combat sports for more than 30 years, this is a very exciting time for mixed martial arts. We at Bellator MMA are very much looking forward to hosting an event in the ‘Crown Jewel of America,’ New York.  Two Bellator champions, Liam McGeary and Marcos Galvao call New York home and I know it means a great deal to the both of them, as it does for the entire promotion. We’ve already been in contact with the great people at the Barclays Center and several other incredible venues, and we can’t wait bring our world-class athletes and action-packed shows to an arena in the Empire State soon.”

The World Series of Fighting also issued a statement:

“This is an exciting and historic day for our great sport.  Those who have been lobbying for the legalization of MMA in NY State, including World Series of Fighting’s new COO Michael Mersch, should be commended for their persistence and commitment to seeing through the passage of legislation that will finally allow fans to watch live MMA in the Empire State, and fighters to compete there.  We recently opened an office in Manhattan so, along with our television partner, NBC, we are looking forward to bringing our brand of professional MMA to New York very soon.”

As mentioned in its press release, WSOF opened an office in New York with the anticipation that it would be doing business in the state soon.

Jury awards Hogan additional $25.1 million in punitive damages

March 22, 2016

On Monday, Florida jury tacked on an additional $25.1 million punitive damages award for Hulk Hogan.  This amounts to a total of $140.1 million awarded to the former pro wrestler after the jury found in his favor and awarded him $115 million this past Friday.

Gawker Media was ordered to pay $15 million while Nick Denton was assessed $10 million and Gawker’s former editor in chief, Albert J. (“AJ”) Daulerio $100,000.  Punitive damages are awarded in addition to the actual damages at trial.  They are meant to reform or deter the defendant and others from engaging in similar conduct.  Not every state awards punitive damages.

According this report, the trial court judge told the jury that they could not award punitive damages that would bankrupt the defendants.

The net worth was determined by the court (via www.capitalnewyork.com):

The court determined that Gawker Media, a U.S. subsidiary of Cayman Islands-based Gawker Media Group Inc., had $48.7 million in gross revenues last year and a net worth of just $83 million. It determined Denton’s net worth to be $121 million — $117 million of which is tied up in stock in Gawker Media Group, Inc., which is valued at $276 million. The court determined that Daulerio’s net worth was negative $27,000, since he has no material assets but $27,000 in student loans.

Gawker, et al. indicated that it would appeal the jury findings and the damages awarded in hopes of either overturning the decision and/or reducing the monetary award.

Payout Perspective:

The moral of the story for AJ Daulerio is not to mess around at a deposition as it was his flippant answer to a question that seemed to have annoyed the jurors.  Even though the court advised that it was not to bankrupt the parties in awarding punitive damages, it seems like the award would do so for Daulerio.  One has to conclude that based on the monetary award, that Gawker will most certainly appeal.

New York Assembly passes MMA bill

March 22, 2016

The New York State Assembly passed legislation that would legalize mixed martial arts in the state.  The bill now needs the signature of the governor for New York to be the final state to legalize MMA.

The passage comes after years and years of lobbying efforts, two lawsuits and an appeal that was set to occur next month.

The legislation came to the State Assembly for vote and after over 2 hours of assembly members having their chance to speak, the bill passed.

The green in the twitter picture indicates “Yes” votes.

The UFC issued a press release immediately after passage and will hold a press conference at 4:30pm PT Tuesday.

From the UFC press release:

UFC® Chairman and Chief Executive Officer Lorenzo Fertitta applauded the overwhelming, bipartisan New York State Assembly passage of legislation to legalize and regulate professional mixed martial arts (MMA) in New York. The passage of A.2604-C, sponsored by Assembly Majority Leader Joseph Morelle and 72 other Assembly sponsors, means the bill has now passed both houses and will be sent to Governor Andrew Cuomo for his approval.

Lorenzo Fertitta thanked all in Albany that helped in the effort.

“This has been a long time coming and on behalf of our New York UFC athletes and fans, I want to offer heartfelt thanks to Speaker Heastie, Majority Leader Morelle and all the Members of the Assembly – Democrats and Republicans – who voted for this bill.”

Payout Perspective:

Perhaps the UFC press conference will reveal a date for the UFC to head to New York.  Bellator and other promotions will be able to hold events in New York as well.  The UFC indicated that it would hold an event in the state by the fall but maybe that could be moved forward depending on when the state will be able to establish its protocols for regulating MMA.

UFC Fight Night 85 draws 1.149M, Prelims 766K

March 22, 2016

UFC Fight Night 85 drew an average rating of 1.149M viewers on FS1 Saturday night.  The UFC Prelims which preceded the main card drew 776,000 viewers.

Sports TV Ratings reports that UFC Fight Night 85 drew 1.149M viewers in the 10-1:00am ET time slot on Saturday Night.  The NCAA Basketball game between UNC and Providence on TBS which aired during the UFC main card drew the highest viewership for a sports cable show Saturday night with over 4 million viewers.

The Prelims which aired from 8-10pm ET on FS1 drew 766,000 viewers.

UFC Fight Night 2016 through 85

Payout Perspective:

The ratings are very good considering it went up against the NCAA Tournament and Warriors-Spurs on ABC Saturday night.  Aside from Mir-Hunt, there were not many names on this card which took place in Brisbane, Australia.  Yet, the 1.149 million viewers is a nice increase from UFC Fight Night 83 (recall 84 was Fight Pass only) which featured Cowboy Cerrone.  Of course, that event was on a Sunday night

Shamrock, Slice test positive for steroid use at Bellator 149

March 21, 2016

MMA Junkie reports that Bellator 149 competitors Ken Shamrock and Kimbo Slice tested positive for the same steroid.  Each fighter faces a one-year suspension and a $5,000 fine per the Texas Department of Licensing and Regulation.

The February 19 card featured Shamrock against Royce Gracie and Slice against Dada 5000.  The event was the highest-rated Bellator show ever on Spike TV.

Shamrock and Slice were found with the steroid nandrolone according to urine test results.  Shamrock also tested positive for methadone.

The State of Texas is offering the fighters a settlement for coming into compliance that offers a reduced punishment of a $3,000 and a license revocation.

Payout Perspective:

The test results reveal an even worse case scenario that what we had previously.  Not only did these over the hill fighters embarrass the sport of MMA with their respective fights, Shamrock and Slice failed drug tests for using steroids.  One would think that with the use of these drugs, their performances would have been better.  Alas, that did not happen.

The question for the company is can Bellator address this issue with a comprehensive anti-doping program like the UFC or would cause too much of a financial burden on the company.  Bellator can always rely on state commissions to test fighters but it’s clear that this may not be working.

Florida to amend law disclosing MMA promoter information

March 21, 2016

A Florida law set to go into effect this July will tighten an already broad exemption to exclude MMA promoter information from a public records requests.

The new law amends the Florida state public records exemption of 548.062 which indicates that all confidential business information required to be filed with the Florida State Boxing Commission after a match or obtained during an audit of the promoter’s books and records… and now expands the exemption to cover all confidential business information provided to the promoter to the Commission…

A portion of the law that will come into effect in July states:

“The disclosure of proprietary confidential business information could injure a promoter in the marketplace by giving the promoter’s competitors insights into the promoter’s financial status and business plan, thereby putting the promoter at a competitive disadvantage. The Legislature also finds that the harm to a promoter in disclosing proprietary confidential business information significantly outweighs any public benefit derived from the disclosure of such information.”

Within 72 hours after a match, the promoter must file a written report with the Commission.  This report includes the number of tickets sold, the amount of gross receipts, and any other facts that the Commission requires.

As with the previous bill one could extrapolate the amount of complimentary tickets given out by a promoter for the event based on a state requirement that a promoter my give comps to “up to five percent of the seats in the house without including the tickets in the gross receipts without paying corresponding taxes on them.”  The promoter may ask the Commission for authorization to issue tickets more than five percent in certain circumstances.

In addition, Florida’s UFC lobbyist Jeff Johnston has worked on the public records exemption which, according to this article, would close the loophole to disclose information prematurely.  Mentioned in the article was the taping of TUF featuring the Blackzilians versus ATT in Florida.  The new law would make sure that results would not be leaked early.

You may recall, that John Nash of Bloody Elbow was able to obtain a variety of documents from the state athletic commission which revealed how much it made on concessions, ticket revenue and rights fee.  As the article points out, the Muhammad Ali Boxing Reform Act requires promoters to disclose to a state athletic commission the amount it is spending and receiving for an event.  The law in Florida pertains to “pugilistic exhibitions” which includes boxing, kickboxing and MMA so the promoter’s disclosure is something to keep an eye on in the future.

Payout Perspective:

This bill amends the previous law which passed in 2014.  The subtle expansion tightens up the law to ensure that all confidential business information provided by the promoter to the Commission is covered by the law to prevent it from falling through the cracks of being subject to disclosure.  Essentially, the law ensures that all information a promoter provides to the Commission is confidential.   Pure semantics but it likely gives the UFC enhanced security that no information falls into the public domain.  With the UFC heading back to Florida in April, the law seems to be one of appeasement to entice the organization to keep coming back to the sunshine state.

UFC Fight Night 85 attendance, gate and bonuses

March 19, 2016

UFC Fight Night 85 drew a total of 9,552 fans from Brisbane, Australia.  In addition, Mark Hunt, Neil Magny, Johnny Case and Jake Matthews earned the fight-night bonuses.

The event, which started in the morning from Australia drew 9,552 fans with a live gate of $1 million.  The only other visit to Brisbane in December 2013 drew 11,393 for a gate of $1.785 million.  Both events took place at the Brisbane Entertainment Center which houses 13,500.

Hunt and Magny earned Performance Bonuses for their stoppages.  Case and Matthews drew Fight of the Night in a fight where Matthews stopped Case.

The numbers were announced at the post-fight press conference.

Payout Perspective:

The attendance was down but could be due to the morning start in Australia.  Hunt, who headlined the December 2013 show, also was in the main event on Saturday.  The bonuses were clear.  Hunt had a walk off against Frank Mir and Magny was impressive in his stoppage of Hector Lombard as well.

Jury awards Hogan $115M in Gawker lawsuit

March 18, 2016

On Friday, a Florida jury awarded Hulk Hogan $115 million in damages against news entity Gawker after it posted a sex tape of Hogan without his knowledge.

It is too early to know whether Gawker will appeal but according to CNN Reporter Tom Kludt Florida law requires a party to post a bond for the full amount of damages although that is capped at $50 million.  The jury awarded $55 million in economic injuries and $60 million for emotional distress.  This does not include an unspecified amount of punitive damages.

The NY Times provides a concise synopsis of the trial.

A statement from Nick Denton, founder of Gawker, inferred that there will be an appeal.

Payout Perspective:

For those wondering whether Gawker could even afford to put up a supersedeas bond, Michael McCann indicates that Florida law allows judges discretion in determining how much a party must post especially if imposing such a bond would be a substantial injustice.  But, even before an appeal, one might expect Gawker’s attorneys file a Motion for Remittur which would request the court to reduce the amount of damages awarded by a jury.  In addition, or in the alternative, Gawker might seek a Motion for New Trial and/or Judgment Notwithstanding the Verdict.  Each of these alternatives would see Gawker requesting relief from the jury award due to some legal circumstance that was not followed and/or was done in clear erro.  Since the presiding judge would hear such a motion, the likelihood of success would be low since the trial court judge would be the one that would be overruling themselves.

We should see in the coming days the plan for Gawker.  Frankly, Hogan is not getting the money awarded by the 6-person jury any time soon.

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