January 20, 2017
Golden Boy Promotions and ESPN have entered into an agreement to air the promotion’s fights on the sports network according to ESPN. The first of 42 fights will begin airing in March.
The events will take place on Thursday, Friday or Saturday nights which will mark a return to boxing on ESPN.
Tecate will sponsor the series which will air on ESPN2 and be simulcast in Spanish on ESPN Deportes. The agreement has scheduled 18 fights in 2017 and 24 in 2018. There is an option for a third year.
Notably, the ESPN article indicates that the exclusivity provision with ESPN and PBC was eliminated as part of the settlement with Top Rank Boxing’s antitrust lawsuit last year. Golden Boy’s lawsuit against Al Haymon continues with a pending motion for summary judgment yet to be decided. The trial is set for March, the week prior to the debut of Golden Boy on ESPN.
This is a good sign for boxing with increased exposure for Golden Boy’s stable of fighters. It also brings into the question of the whether Premier Boxing Champions will return to ESPN this year. The deal will rely on sponsors than a license fee and we can see Tecate as a presenting sponsor with others to help fund the series.
January 19, 2017
The United States District Court for the Southern District of New York denied a request by attorneys for World of Boxing, L.L.C. to continue the February 6, 2017 trial date.
For background on the case, see our post here. Essentially, the parties are suing each other over a failed fight in Russia due to an alleged failed test by Povetkin and Wilder’s subsequent actions after he learned of the drug test. There is also an issue of over $7 million held up in escrow due to the failed fight.
Notably, the court order identifies a September 26, 2016 hearing in which the parties wanting an “expedited trial” and agreeing on the February 6th trial date. The parties agreed to the sole issue of whether Alexander Povetking ingested Melodonium after it was formally banned on January 1, 2016.
World of Boxing has complained of discovery issues in which Wilder’s attorneys claimed privilege for certain emails between purported agents of Wilder and his attorney.
MMA Payout will keep you posted on the case as it heads to trial.
January 18, 2017
Nate Diaz is in the process of applying for a boxing license in the state of Nevada according to an ESPN report.
Diaz has paid his NSAC fine of $50,000 which stems from the UFC 202 pre-fight press conference bottle-throwing fiasco. As a result of clearing the fine, he should be able to obtain the license once he files the necessary paperwork.
Floyd Mayweather, who did an ESPN “car wash” to promote fights at the Barclay’s Center last week indicated that he had Facetimed with Diaz. According to Mayweather, Diaz believed the UFC put him on ice. Hence, the reason for the boxing license.
Diaz had stated (whether serious or not) that he would not fight in the UFC unless he was paid $20 million.
You may recall that Conor McGregor obtained a boxing license in California but cannot get a Nevada license since he has an outstanding fine from the NSAC of $75,000. Of course, he is in the midst of seeking judicial review of the commission ruling.
Similar to McGregor, Diaz is likely creating leverage. Diaz boxing seems unlikely especially when you consider that he’s still under contract with the UFC and the company will not allow him to fight. Of course, if the UFC is promoting or co-promoting that might be something to discuss. But, at this point, I doubt we see Diaz boxing.
January 18, 2017
Showtime Boxing’s event featuring Badou Jack and James DeGale drew 454,000 viewers on Saturday night. The overall event scored 391,000 per Nielsen.
According to Sports TV Ratings, the event drew 175,000 viewers in the A18-49 rating.
The entertaining fight which sought to unify the super middleweight belts ended in a draw. Each fighter was down once during the back and forth fight.
The ratings are exceptional for a Showtime Boxing event as it’s rare that any fights on the network muster near 400,000 viewers. It is significant to note that the fights happened the same night as the Patriots-Texans game on CBS.
January 13, 2017
Dana White has made a counteroffer to Floyd Mayweather’s offer of $15 million to Conor McGregor. On FS1’s “The Herd” with Colin Cowherd, he offered to pay the fighters $25 million each and a split of the PPV revenue.
During his ESPN “car wash” earlier this week, Mayweather stated he’s interested in McGregor but as the “A” side would want $100 million plus his PPV cut. He would grant McGregor $15 million.
White chimed in today with his offer.
Of course, but its far less than Mayweather had been suggesting. Thus, TMZ caught up with Floyd who gave his response.
Let’s be honest, this fight will not happen if the UFC wants to co-promote. Mayweather garnered a 60-40 split in his Fight of the Century with Manny Pacquiao. He’ll be sure to want a 70-30 split against an unproven commodity. Sure, the UFC PPVs and attendance/gate are good for McGregor, but Mayweather knows his worth and there’s no reason for him to fight unless he gets what he wants.
January 12, 2017
The Al Haymon-Golden Boy antitrust lawsuit filed in federal court in Los Angeles is set for trial on March 14, 2017 if the court does not grant the defendant’s Motion for Summary Judgment.
For a good refresher on what this case is about and the gist of the motion, you can read Paul Gift’s synopsis last month. We take a deeper dive in the legal issues of the motion below.
An oral argument for the motion was taken off calendar (i.e., cancelled) by the court this past November 28th. As of this date, there has been no ruling issued by the trial court. Realistically, there is no timeline for the court to render a ruling on the motion except for the fact that there would likely be an opinion prior to trial documents needing to be filed with the court.
Haymon’s Motion for Summary Judgment
Haymon’s attorneys, and the attorneys for his entities that were also sued in this litigation argue that Golden Boy failed to establish a triable issue of fact of its attempted monopolization. It essentially argues that there is no evidence of specific intent for a monopoly, Golden Boy failed to identify any anticompetitive or predatory conduct and Golden Boy misconstrues the concept of antitrust injury.
One of the claims set forth by GBP is that Al Haymon should be held individually liable for violation of the antitrust laws. Haymon attorneys assert that Haymon could not be liable of antitrust injury because individual liability requires “inherently wrongful” conduct, a per se violation. Haymon argues that attempted monopolization is not properly evaluated as a per se antitrust violation.
In an antitrust case, there are two ways a court looks at whether there is a violation of the antitrust laws. The first is a “per se” violation and the second is the “rule of reason.” Per se relates to conduct that is manifestly anticompetitive with limited potential for procompetitive benefit. The rule of reason is the presumptive or default standard and the general standard it examines whether the procompetitive benefits outweigh the anticompetitive effect.
“Inherent conduct” is equated to a “per se” violation by Haymon. In its moving papers, they state that courts have regularly dismissed claims against corporate officers in cases dealing with conduct that is permitted or even encouraged by the antitrust laws. Here, the argument is that Haymon and his entities did not do anything wrong.
It also argues an “even if” scenario providing the hypothetical that if a court were to analyze the tying claim as a “per se” claim it would fail on the merits. It first argues that there is no tie in the first place. Haymon points out the similar Top Rank lawsuit in citing that Top Rank failed to prove as a matter of law that the two distinct services of promotion and managing were tied together. The clause in the contract that is questioned is the provision that requires consent to enter into contracts. However, Haymon’s attorneys point to the Canelo Alvarez-Amir Khan fight in May 2016 as an example of interpromotional fight making. Also, the Floyd Mayweather-Manny Pacquiao case is another example which reflected the opportunity for a contracted Haymon fighter to work with another promoter. Thus, the examples show that the contracts do not foreclose other promoters.
Haymon argues that the market described by GBP are artificial and are “illogical, divorced from the reality of the boxing industry, and fail to satisfy GBP’s burden to establish coherent markets in which the Defendants could possibly have market power.” It states that “Championship-Caliber Boxers,” the market described by GBP in its lawsuit is not a recognized industry term. Haymon attorneys identify the fact that the term was interpreted differently by multiple people within the boxing industry. They also argue that GBP has not shown that there are barriers to entry in the markets for which they define.
Golden Boy Theory of Antitrust Injury
As you might recall Golden Boy brought a lawsuit against Al Haymon and his entities illegal tying of its managerial and promotional services.
As we wrote:
The lawsuit claims that Haymon, et. al have created a “tying” relationship in violation of antitrust laws. This is done through agreements affecting to separate relevant markets. The first market is for management of Championship-Caliber Boxers and the market for promoters. As described in the Complaint, the management market is the “tying” market whereas the promotion market is the “tied” market. Essentially, the fact that Haymon manages so many fighters it affects the promotions market since he has exercised control over the direction of each fighters’ career.
Tying under Section 1 of the Sherman Act must show:
- There is evidence of a tie;
- There is evidence “of coercion” of purchasers to buy products or services;
- There is evidence of market power in a properly defined market.
Golden Boy opposes the motion on the grounds that Al Haymon is personally liable for antitrust injury. It suggests that the standard for individual antitrust liability is met when an officer knowingly approves to each element of a claim whether or not the claim involves “inherently wrong” conduct. It also states that it has ample evidence to support their tying claim as Haymon tied their management services to the rejection of competitors’ promotion services in favor of their own. Also, it rebuts the assertion by Haymon that it has fabricated the relevant market definition. It also contends that there are “significant barriers to entry” in the relevant markets. Finally, it states that the Haymon acted as promotes as well as managers.
GBP claims that issues of fact exist as it relates to the evidence of exclusionary contracts which “tie out” others. It also claims that its expert’s testimony provides ample evidence of the markets in the industry and that they are controlled by Haymon.
In its opposition to the motion for summary judgment, GBP argues that Haymon’s model of paying supracompetitive sums is not a “rational business model, unless there is to be a payoff.” The “payoff” as concluded by GBP is the monopoly of the boxing promotion business, controlling the television market for boxing and “invoking supracompetitive pricing once dominance is obtained.”
The opposition points to “draconian exclusionary terms” in contracts which give Haymon Sports control over all aspects of the boxer’s career and a veto right over all boxing related contracts. In its pleadings, Haymon does admit that a “standard management agreement gives it the right to approve the boxer’s selection of promoter, it has never exercised this right to require or coerce its boxers to use or not use a particular promoter.” This seems to negate, but confirm terms within the Haymon boxing management contract that reflects control over the boxer’s selection of promoter.
GBP also argues that Haymon has a tying arrangement in which one must refrain from accepting another product. Here, GBP contend that Haymon tied his management services to the rejection of competitors’ promotion services. They suggest that fighters under contract with Haymon know that they cannot work with other promoters outside of Haymon. GBP indicates that this is a triable issue of fact that would
The standard on a motion for summary judgment is to weigh all of the pleadings and facts within and weigh them in the “light most favorable to the non-moving party (in this case GBP).” If the court determines that there are no genuine issues of material fact, it will grant a dismissal as a matter of law. However, a court will deny a motion for summary judgment if there are pending issues of fact.
Whether or not Haymon could be individually liable will be an issue the court will need to determine based on the facts provided and the legal arguments made by the parties. While Haymon’s attorneys argue that personal liability cannot be assessed in these matters, Golden Boy argues that case law supports the contention that Haymon is personally liable. As for the business model, the fighter contracts will be an issue for the court to consider as well as GBP’s expert testimony which addresses the relevant markets.
Once a decision is rendered, MMA Payout will let you know
January 11, 2017
Floyd Mayweather, Jr. indicated that he has indicated that he would fight Conor McGregor if the UFC lightweight champion would take $15 million and a cut of the PPV. Mayweather stated that he was the “A” side and would want $100 million guaranteed plus a bigger share of the PPV.
Doing the ESPN “car wash,” he told Stephen A. Smith on “First Take” that he tried to make the Conor McGregor fight. McGregor stated he would box Mayweather for $100 million.
On a Facebook Live chat with ESPN’s Brian Campbell, Mayweather claimed that the last time he saw Conor McGregor fight in the UFC was a little of his UFC 205 fight on a cell phone while at Boston Celtic Isaiah Thomas’ wedding. He also stated that he Facetimed with Nate Diaz talking about McGregor.
Mayweather was doing the car wash as Mayweather Promotions is promoting fights taking place at the Barclay’s Center Saturday. His fighter Badou Jack, is in the main event fighting James DeGale.
In response to Mayweather’s ESPN interviews, McGregor posted a cartoon of himself standing over Mayweather, holding two belts.
Will a McGregor-Mayweather fight actually happen? While McGregor has obtained a California boxing license, it’s still unlikely that the fight actually happens. McGregor is still under contract with the UFC and unless they get a cut of this endeavor, I would suggest they remain the greatest obstacle (not the salary squabble) from this spectacle from happening.
January 7, 2017
2016 seemed to be a low-key year in the world of boxing. While 2015 saw some major moves from Al Haymon and his Premier Boxing Champions, the endeavor has fizzled. The same could be said for the year of boxing on PPV as there were no major events that drew PPV buy rates the likes of Mayweather or Pacquiao in their primes.
We saw less of Haymon’s Premier Boxing Champions on the multiple channels it was on the year prior. PBC has blown through a lot of capital since it launched in March 2015. A lawsuit filed by Golden Boy, one of two filed by rival organizations, is set to go to trial in March 2017.
Currently, Haymon and the entities sued by Golden Boy have filed a motion for summary judgment to dismiss the case prior to the trial date. No decision has been made as of this date.
The other antitrust lawsuit against Haymon, filed by Top Rank Boxing was settled by the parties this past spring.
Both of the lawsuits claimed that Haymon’s PBC business model sought to create an illegal tie-in through Haymon’s signing of fighters as their management and then promoting them. They also argued that PBC foreclosed the fighter market and possibly promoting the fighter since fighters under Haymon would allegedly not deal with other promoters. It also tied-out promotions that sought to be on television since Haymon struck exclusive deals with multiple networks.
Chris Algieri fought this past April but expressed concern with how much he would be paid as his promoter did not reveal how much of a percentage he would receive from his fight against Errol Spence, Jr. The situation brought up an issue with the Ali Act.
Speaking of Spence, after defeating Algieri his next fight in August drew an impressive 4.8 million viewers on NBC with a peak of 6.34 million. The PBC on NBC fight aired after the U.S. Olympic gold medal basketball game between the U.S. and Serbia. The one-hour show was sandwiched between Olympic network coverage which may have attributed to the huge viewership which seems to be an anomaly when compared to past PBC on NBC telecasts.
Deontay Wilder and his promoter Lou DiBella are embroiled in a lawsuit with Alexander Povetkin and his promoter World of Boxing, LLC over a failed fight that was set to happen in Russia in May. Povetkin tested positive for Meldonium. However, he claimed that only small traces were found in his sample and his use occurred prior to January 1, 2016 when WADA banned the substance. The WBC reinstated Povetkin because the substance in his system was below the threshold accepted by WADA although it claimed to require Povetkin to submit to drug tests. The parties are embroiled in a discovery fight but the case is set to go to trial this spring.
Notably, Povetkin tested positive after he was reinstated and scheduled to face Bermane Stiverne for the WBC heavyweight title. He stated that he wanted his “B” sample tested on Thursday at the UCLA Laboratory in Los Angeles.
DiBella is one of the boxing promoters that protested the new law legalizing MMA in New York, but requiring promoters to provide $1 million worth of coverage per athlete in the event of a life-threatening brain injury. He pulled the rest of his shows scheduled for New York in late October as a form of protest and as a matter of practicality. Jo DeGuardia of Star Boxing along with DiBella submitted a public comment regarding the regulations.
A survey of all of the fights on HBO, including PPV replays, drew an average of 780,000 subscribers of the premium channel. The highest-rated fight this year was GGG versus Dominic Wade on April 23rd which drew over 1.3 million viewers. Only two other fights reached past 1 million viewers: Sergey Kovalev versus Jean Pascal which drew 1.179 million viewers in January and Andre Ward versus Sullivan Barrera which drew 1.064 million viewers.
Showtime had less fights this year and drew an average of 363,000 viewers.
In May, a year after the “Fight of the Century” between Manny Pacquiao and Floyd Mayweather, Jr. resulted in a lawsuit as Showtime sued Top Rank citing indemnification and breach of contract related to lawsuits filed by third parties against Showtime and Top Rank related to Pacquiao’s claim that he fought with an injury against Mayweather. Showtime sought to invoke the indemnification language in the contract. However, Top Rank, as you might expect, disagreed with the reading of the contract. In fact, they intended to bring a motion to dismiss Showtime’s lawsuit.
But, in September, Showtime voluntarily dismissed its case.
Finally, it was a rather disappointing 2016 for boxing PPVs.
Boxing PPVs 2016
April 9, 2016 – Pacquiao-Bradley III: ~400K PPV buys
May 7, 2016 – Alvarez-Khan: ~450K-600K PPV buys
July 23, 2016 – Crawford-Postol: 50K-60K PPV buys
September 17, 2016 – Alvarez-Smith: >~300K PPV buys
November 5, 2016 – Pacquiao-Vargas: ~300K PPV buys
November 19, 2016 – Ward-Kovalev – 160,000 PPV buys
An unfair comparison, except for this web site I suppose, but if you consider the UFC had its most successful year on PPV with 5 events going over 1 million, boxing had a dismal year. Canelo Alvarez, the predicted heir to boxing PPV, did not draw as expected and Manny Pacquiao is losing his appeal in the U.S. Note that HBO passed on distributing his November fight in order to promote a fight that drew just 160,000 on PPV. Unless GGG-Canelo happens in the fall of 2017, there are not any marquee PPV fights coming up in boxing this year.
December 30, 2016
Thus, on September 1st the sport became legal and regulated by the state.
Assembly votes shown in this picture. Green is good.
— jim genia (@jim_genia) March 22, 2016
After much lobbying, time and effort, the UFC opened up with the first major card at Madison Square Garden on November 12th.
Notably, the UFC 205 Countdown show included a part dedicated to showing Sheldon Silver indicted on corruption charges. He is currently appealing his prison sentence. It was one final shot at the individual that Dana White blamed for not allowing a vote on the bill for years.
The UFC debut did not disappoint as it enjoyed the richest gates in company history.
Not long after the initial joy of legalizing the sport, boxing promoters began to complain about the hefty tax needed to insure fighters for events. A new insurance premium that would cover $1 million for each fighter on the card would be required for operation in New York.
In October, Promoter Lou DiBella canceled the remaining cards he was planning in the state due to the new requirement that has a $1 million minimum for each fighter in the event the fighter suffer a traumatic brain injury. The UFC paid approximately $1,675 per fighter and approximately $44,000 overall. It paid $40,200 for the Albany, New York show on December 9th. This does not include the standard $50K medical and $50K accidental death insurance policies.
Of course, one has to wonder whether or not boxing lobbied against the MMA bill due to the new insurance requirement. The new requirement does stem in part from a 2013 post-boxing incident in the state which left boxer Magomed Abdusalamov fighting for his life and a commission report found issues with the handling of the event.
New York set a tax of 8.5% on gross receipts in addition to other tax terms for MMA events. Thus, the state collected approximately $1.5 million in taxes from UFC 205 according to the reported gate of $17.7 million.
Despite the hefty tax paid by the UFC, it reported the best merchandise sales ever for an event.
Look for the UFC to hold big events in the New York to offset the insurance and taxes it needs to pay. Notwithstanding the cost, the final hurdle to legalize the sport in the state was a monumental hurdle the company overcame. One might consider it a factor in the sale of the company.
16 for 16
5. UFC 200
14. Bellator 149
15. CM Punk debuts
December 20, 2016
Bernard Hopkins’ last fight of his career drew 934,000 viewers on HBO Saturday night per Sports TV Ratings. Hopkins was knocked through the ring ropes by Joe Smith, Jr. and could not continue.
The fight, which aired from 11:54 to 12:24 am, drew 464,000 viewers in the adult 18-49 demo. It also peaked at 1.035 million (according to Nielsen) at the time that Hopkins was knocked out.
In addition to the main event, there were two other fights during the telecast. The opening bout between cruiserweights Oleksandr Usyk and Thabiso Mchunu drew 560,000 viewers (270,000 A18-49). Usyk prevailed via TKO in the 9th round. In the second fight of the night, Joseph Diaz and Horacio Garcia battled in a matchup of featherweights. Diaz won via decision. That fight drew 644,000 viewers (304,000 A18-49).
The HBO fight occurred after the UFC on Fox event went off the air so there was no real overlap. The ratings are a good bounce back from last week’s Terrence Crawford fight. Of course, that telecast ran opposite a Showtime card and UFC on PPV. Likely, many tuned in to see the 51-year-old Hopkins one last time. Unfortunately, for Hopkins fans, he was sent through the ropes unceremoniously to end his career.