Haymon seeks to stay lawsuit filed by Golden Boy

July 8, 2015

Attorneys for Al Haymon are seeking to stay the lawsuit filed by Golden Boy Boxing arguing that arbitration in the matter between Haymon and Golden Boy is pending.  Thus, the issues brought up by Golden Boy in its lawsuit may be resolved by the end of July.

The motion seeks to put on hold the lawsuit filed by Golden Boy on May 5th citing Haymon violates portions of the Muhammad Ali Act, antitrust laws and state laws in California.  Haymon’s attorneys state that by July 29, 2015, an Arbitrator will rule on whether all of the claims in the Golden Boy lawsuit have been released pursuant to a Settlement Agreement and Mutual Release (“Settlement Agreement”).

Taking a step back, Haymon and Golden Boy entered into the Settlement Agreement which would sever its business relationship.  According to court documents, the Settlement Agreement was signed by the parties (including Richard Schaefer and Oscar De La Hoya) on December 18-19, 2014 and exercised by Haymon on January 8, 2015.  According to Haymon, it was a “global” settlement of all issues between the parties.  Haymon made “a substantial payment to Golden Boy” which Golden Boy accepted when the parties decided to end its business relationship.  The Settlement includes an arbitration provision which would require that the parties be subject to an Arbitrator rather than litigate the matter in court.

According to the motion, a Sports Illustrated article leaked to the press on April 28, 2015 regarding a potential lawsuit to be filed by Golden Boy against Haymon sparked action by the PBC head’s legal team.  Recognizing that the lawsuit might be filed soon, Haymon requested Arbitration under the Settlement Agreement on April 28th.  Attorneys for Golden Boy filed counterclaims against Haymon.  Golden Boy filed suit on May 5th.

The Settlement Agreement includes language preventing a financial audit of Haymon’s records.

Haymon attorneys state that the arbitration was filed before the May lawsuit and the Settlement Agreement includes an arbitration clause stating that the Arbitrator has exclusive jurisdiction to determine whether the claims have been released.  It cites the Federal Arbitration Act as the reason the court should stay the lawsuit.  The Arbitrator will receive legal briefs on the issue on July 10th and a hearing before the Arbitrator will be held on July 29th.

The actual Settlement Agreement is attached to Al Haymon’s Declaration but it is heavily redacted preventing the public from reading the salacious details of the settlement.

The hearing on the motion to stay will be on August 10th in US District Court in Los Angeles.

Motion to Stay Case – Haymon

Dec of Al Haymon in Support of Motion to Stay

Payout Perspective:

While the court papers state that the Arbitrator will hear the arguments on July 29th, it’s not clear when a decision might be made.  Although Haymon’s legal team will argue that the lawsuit is covered in the Arbitration agreement, it is not known when the Arbitrator would rule.  Thus, aside from substantive legal issues, Golden Boy will argue that this is a stall tactic by Haymon avoiding litigating the lawsuit.

On July 6th, the court transferred the case filed by Top Rank against Al Haymon to the same judge that is handling the Golden Boy case.  Even if the Golden Boy lawsuit is stayed, it still has the Top Rank filing ahead of it.

Bellator 139: 764K viewers and Friday night boxing numbers

June 29, 2015

Bellator 139 drew an average viewership of 764,000 viewers on Spike TV Friday night per Sports TV Ratings.  The event is down from its tent pole event of a week prior but it still was the second-best rating on the network since February.

In the main event of Friday night, former UFC heavyweight Cheick Kongo defeated Alexander Volkov.  The other big news coming out of Bellator 139 was the KO of Joe Schilling by Hisaki Kato.  Per Nielsen sources, the peak for the show was 988,000 viewers during the last quarter hour (10:45-11pm).

Bellator 137 pulls the promotion’s 2015 Spike TV average up to 800,000 viewers.

Overnight Peak
Bellator 132 767,000 1,200,000
Bellator 133 565,000 967,000
Bellagtor 134 872,000 1,200,000
Bellator 135 607,000 922,000
Bellator 136 655,000 900,000
Bellator 137 594,000 768,000
Bellator 138 1,580,000 2,100,000
Bellator 139 764,000 988,000

Bellator 139

Sports TV ratings also notes that boxing on TruTV drew 303,000 viewers Friday night in the 10pm-12am slot.  The TruTV fights are promoted primarily by Top Rank.  Also, boxing on FS1 on Friday drew 129,000 viewers.  The event on FS1 appears to be the last promoted by Golden Boy.  Additionally, Showtime aired a prospect card Friday night although no information on the ratings were available at this time.

Payout Perspective:

There were a lot of viewing options Friday night for combat sports enthusiasts but viewers tuned in to Bellator 139 which should be seen as a positive for the company and Spike.  It’s interesting that it did so well the week after its tent pole event.  The last tent pole event, Bellator 131, did not have a follow event the next week.  In fact, the next Bellator event was not until January 2015.  We could see more follow up events the week after to take advantage of the momentum.

In terms of boxing ratings, the TruTV ratings are surprising and it looks like Top Rank has found a nice way to promote its HBO fights the next night.

Golden Boy sues Haymon for antitrust violations

May 9, 2015

Golden Boy Promotions LLC and boxer Bernard Hopkins filed suit this week against Al Haymon and a variety of Haymon’s businesses and associates with respect to violations of the Sherman Antitrust Act.  The lawsuit was filed in federal court in Los Angeles.

The lawsuit paints the picture that many competitors have accused Haymon of for some time.  He is attempting to monopolize professional boxing in the United States and drive out all competition.  The lawsuit accuses Haymon of “blatantly” ignoring the “firewall” imposed by federal (specifically the Muhammad Ali Boxing Reform Act) and state laws which preclude a manager also acting as a promoter for a fighter.  The lawsuit claims that he has forbidden “hundreds of boxers” he manages from signing with another promoter.

The lawsuit names Waddell & Reed Financial, Inc. and Waddell & Reed, Inc. as defendants that financed and aided Haymon through an investment fund that funded the boxing enterprise.  Plaintiffs claim that these defendants provided more than $400 million dollars to finance Haymon.

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.

The Complaint filed by Bertram Fields of Greenberg Glusker Fields Claman & Machinger, LLP in LA states that Haymon acted as an unlicensed promoter.  In fact, the Complaint cites an LA Times article which states that Haymon was the “main promoter” for the Floyd Mayweather-Manny Pacquiao fight.  The scheme articulated by Plaintiffs is that Haymon is using his dominance in one business to “take over and monopolize another business that federal and state law prohibit them (Haymon, et. al) from even entering.”

Plaintiffs are seeking damages in excess of $100 million which, according to relevant statutory law, could lead to treble (3 times) damages.  Thus, the lawsuit could be for more than $300 million.  In addition, Golden Boy is seeking an injunction from Haymon’s continued promotion.  This possibly could mean the severing of his multi-network affiliations with airing Premier Boxing Champions.

Perhaps not a coincidence, the Oscar de la Hoya led Golden Boy filed the lawsuit on Cinco de Mayo.  Plaintiffs seek a jury trial.

Payout Perspective:

We will have more on this in the weeks to come but if you were to compare this lawsuit to the one filed by the former UFC fighters, I would tend to believe that this antitrust claim has much more of a bite to it. Although it’s likely to sustain a Motion to Dismiss from Haymon’s lawyers, I think it has a better chance of making it to the discovery stage of the lawsuit.  We shall see how this will go.

Golden Boy eyes potential antitrust lawsuit against Haymon, PBC

May 1, 2015

There are reasons why Al Haymon never speaks, one of those may be to prevent the threat of litigation.  A recent article about Haymon’s Premier Boxing Champions may bring on an antitrust lawsuit involving rival Golden Boy Promotions as chief plaintiff.

A recent Sports Business Journal article featured Haymon’s PBC and went over how funding was structured.  Although Haymon did not provide comment for the article, factual information in it allegedly strengthened the argument that Haymon’s business model for PBC violates portions of the Muhammad Ali Boxing Reform Act.

A draft of the Complaint has been viewed by SI.com and it appears that Golden Boy Promotions is seeking a temporary restraining order and then a permanent injunction against his business practices that violate state and federal laws.  It also requests monetary damages against Haymon.

The claim is that Haymon is using his monopoly as a boxing manager to create another monopoly for promoting TV fights.

Golden Boy is hush on if and when this lawsuit may be filed.

Notably, the SI article includes a letter dated April 28, 2015, from the Association of Boxing Commissions (“ABC”) to the Department of Justice in which it claims that Haymon is in violation of the Ali Act.  Essentially, through his controlled companies Haymon is acting as manager and promoter which the ABC claims to be a violation of the “Firewall provision” of the Ali Act (specifically section 5(b) of the Act).  ABC also calls into question the contracts Haymon fighters must sign.  Essentially, ABC believes that they are in “restraint of trade” and “contrary to public policy” as the contracts exceed 12 months.  A footnote in the letter notes that UFC, Bellator and other MMA promotions have this contractual model.  It also notes that MMA is not covered by the Ali Act.

Payout Perspective:

This will be an interesting lawsuit and with the Zuffa antitrust lawsuit ongoing, we can see some major waves happening in the business of combat sports.  Haymon’s boxing business model is unique and received much scrutiny by rival promoters.  There have been attempts in the past to sue Haymon but those were summarily dismissed and/or settled.  If Haymon and PBC are sued, we may see some interesting information divulged from the factual discovery process in the lawsuit.  It could also overturn the current wealth of boxing on multiple networks by PBC.  MMA Payout will keep you posted.

May-Pac PPV will cost $99

April 1, 2015

The Wall Street Journal is reporting that May 2nd’s long-awaited PPV fight between Manny Pacquiao and Floyd Mayweather, Jr. will have a price point of $99 HD and $89 SD.  It will be the highest priced PPV ever.

The previous high for a sport PPV was “The One” which featured Mayweather fighting Canelo Alvarez.  The event which drew a record $152 million in PPV also had the highest price point, $74.95 HD ($64.95 SD) for a PPV prior to next month’s event.

HBO and Showtime are handling the negotiations with pay-TV distributors and had sought an advantageous split on behalf of Mayweather and Pacquiao.  With a normal split of 50/50 for PPVs, HBO and Showtime were looking for a 70/30 split of the PPV revenue.  Of course, pay-TV distributors balked at the proposal.

The key distributors involved are iN Demand and DirecTV. The other distributors that the networks must reach agreements with are Dish Network and Vubiquity, the entity that handles negotiations for AT&T and others.

The WSJ report indicates that distributors will concede a split in the favor of the networks but not as much as the 70% proposal.

Estimates claim that the PPV could garner 3 million PPV buys which may almost double the previous PPV record.

Payout Perspective:

It’s unlikely that $100 will deter many wanting to see this fight.  Although the price is steep for a fight that many believe should have happened years ago, it is still an attraction that is unique and features the best known boxers in the sport.  It was no surprise that HBO and Showtime sought a bigger piece of the pie in these negotiations as both are trying to maximize the revenues as they have agreed to partner in this event.

Featherweight boxer Gonzalez sued by Golden Boy

March 31, 2015

ESPN reports that Golden Boy Promotions filed a lawsuit against boxer Jhonny Gonzalez on Friday prior to his fight on Saturday.  The complaint filed in Los Angeles Superior Court claims that Gonzalez’s Mexican promoter violated Golden Boy’s exclusive rights to promote his bouts.

Despite the lawsuit, it did not attempt to file an injunction from stopping Gonzalez from fighting Gary Rusell, Jr. Saturday night.  It is requesting $1 million and for equitable relief which asks the court to enforce Golden Boy’s promotional agreement which Gonzalez entered into in 2013.

The lawsuit implicates Al Haymon as conspiring with Gonzalez’s promoter, Osvaldo Kuchle’s Promociones del Pueblo, in delaying a bout with Russell (who Haymon manages) until Golden Boy was not in the picture.

Gonzalez was stopped by Russell, Jr. on Saturday.

Payout Perspective:

Although the story does not indicate a cause of action, one might expect it to be a breach of contract claim.  This is at least the second boxing lawsuit which names Al Haymon as a contributing issue in a promotional dispute.  Last year, you might recall that Sergey Kovalev’s promoter, Main Events, sued Adonis Stevenson’s management group as well as the boxer.  That lawsuit was settled essentially with Bernard Hopkins stepping up to fight Kovalev.  Here, we may have a similar (not the same) situation.  Obviously, the timing of the lawsuit probably precluded an injunction, although it would have been interesting.  But we will see what happens next.

De La Hoya announces the launch of network

January 26, 2015

Oscar De La Hoya announced last week that he is launching his own network.  De La Hoya TV will debut this spring as announced at the National Association of Television Program Executives annual conference in Miami.  The network will offer combat sports including boxing, MMA as well as features on sports and lifestyle that will cater to the burgeoning Hispanic population in the United States.

No word on where you may find De La Hoya TV as the head of Golden Boy Promotions and his partner in the venture, Jose Alberto “Pepe” Gomez are still talking to cable and satellite systems about carriage deals.  Per ESPN, there are no plans for the channel to include live sports programming.

The network will be based in Miami and will focus on Spanish-language content for the U.S. Hispanic market.

Payout Perspective:

This is an interesting business venture for De La Hoya and perhaps just an expansion of his personal brand.  The network states that it will offer boxing and MMA although there is no word on whether it has worked out any contracts with any existing organizations.  Certainly, De La Hoya’s network will join some competition for the Hispanic market as Nuvo TV and the El Rey Network are two of the newer networks looking for a Hispanic audience.  The big question will be whether it can be picked up by a cable and satellite system and how many households it can get into.

Wilder-Stiverne on Showtime scores 1.24M

January 22, 2015

ESPN’s Dan Rafael reports that Saturday night’s boxing event on Showtime between Deontay Wilder and Bermane Stiverne drew an average of 1.24 million viewers per Nielsen.  The peak for the fight was 1.34 million viewers.

The estimated average is based solely on the actual fight and not the overall event televised on the premium cable network.  It was the biggest in over two years and drew the second largest boxing audience since 2004 behind Miguel Cotto-Austin Trout in December 2012.  It also should be noted that the fight between Adrien Broner and Marcos Maidana in December 2013 drew an average of 1.3M viewers on Showtime.

Rafael also provides numbers for the other two fights on the telecast including Leo Santa Cruz’s victory over Jesus Ruiz (912,000 viewer average) and Amir Imam’s win over Fidel Maldonado, Jr. (811,000 viewer average).

Payout Perspective:

The fight between Wilder and Stiverne gained a good amount of buzz in the lead-up to the event.  Showtime had an All-Access centered on the two heavyweights and Don King did his usual promos.  The two fighters also provided their own sparks to fuel interest in the fight.  One might argue that based on the ratings, boxing heavyweights still do matter in the sport.

Golden Boy-Schaefer settle lawsuit, avoid arbitration

January 11, 2015

Kevin Iole of Yahoo! Sports reports that Richard Schaefer and Golden Boy have settled its lawsuit arising out of Schaefer’s departure from the boxing promotion last year.  The settlement leaves Al Haymon with several key boxers for a shwow .

Golden Boy sought private arbitration to settle the departure of Schaefer from this past spring.  Golden Boy was looking for $50 million in damages.  Along with Schaefer, Floyd Mayweather and several key employees of Golden Boy left.  As part of the settlement between the parties, Golden Boy relinquished the rights to several of the promotion’s top fighters notably Adrien Broner and Danny Garcia.

Golden Boy will retain the rights of Amir Khan, Lucas Matthysse and Leo Santa Cruz.  The fighters remain advised by Al Haymon.  The LA Times’ Larry Pugmire indicated that Marcos Maidana will leave to join Haymon (via Bad Left Hook).  According to Iole’s article, Schaefer will be precluded from promoting for a period of time.  But, he’s likely to officially join the Haymon/Mayweather camp.

Payout Perspective:

The settlement saves all parties a lot in legal fees.  It also means that Al Haymon and his “advised fighters” can move forward with a possible network debut on NBC and NBC Sports.  Golden Boy has a thinner roster but it will likely focus its efforts around Canelo Alvarez as the centerpiece for the company.

2014: a look at some of the business issues in boxing

January 2, 2015

MMA Payout takes a quick review of 2014 in the sport of boxing.

2014 was an interesting year for the sport as boxing began to expand with more PPVs than the standard Pacquiao and Mayweather bi-yearly events.

Canelo Alvarez faced Alfredo Angulo in March (the event drew an impressive 350,000 PPV buys), Sergio Martinez faced Miguel Cotto in New York in June (although projected to score 475,000 PPV buys, it drew just an estimated 350,000) and Alvarez returned in July to headline a PPV with Erislandly Lara (it drew an estimated 300,000 PPV buys).  There were also hints of Gennady Golovkin fighting on PPV although that never came to fruition.

Floyd Mayweather fought Marcos Maidana twice this year.  After May’s Mayweather PPV (in which it reportedly drew 900,000 PPV buys), Showtime President Stephen Espinoza informed the media that it would no longer release PPV buy numbers unless the event sets a PPV record.   However, after the second fight in September, it was revealed that the rematch drew 925,000 PPV buys.

Manny Pacquiao’s days as a PPV draw seem to be waning.  Although his rematch with Tim Bradley drew an estimated 750-800K PPV buys, it was down from the near 900K PPV buys in their first fight.  Although nothing official has been released, the Manny Pacquiao-Chris Algieri fight in November drew between 300,000 to 400,000 PPV buys depending on who you asked.  If this number is correct, it’s a huge drop off for Pacquiao.  This would be a likely reason why the push for the mythical matchup with Floyd Mayweather.

In October, ESPN’s Dan Rafael posted the top events in 2014 thus far.  Julio Cesar Chavez vs. Brian Vera 2 drew 1.39 million viewers with a peak of 1.53 million.  The ratings were for only that fight and not the entire card airing on HBO.  HBO dominated the top rated boxing events on cable (premium and/or regular) and Showtime did not crack the top 10.  Still, the competition between the two premium cable channels seemed to heat up in 2014.

With the Kovalev-Hopkins fight, we may see the cold war between Top Rank and Golden Boy softening.  Yet, Al Haymon still is one of the unseen, most powerful men in the business.

There were several notable lawsuits in 2014.

First, Main Events Promotions, the promoter for Sergey Kovalev sued Al Haymon, Golden Boy, boxer Adonis Stevenson and others for backing out of a potential fight between Kovalev and Stevenson.  The lawsuit was dismissed as the parties settled when Kovalev got his big fight against Bernard Hopkins. 

Next, Andre Ward lost a California State Athletic Commission arbitration hearing this past spring against his promoter Goosen Tutor Promotions.  Ward then turned around and sued him in Federal Court alleging violations of the Muhammad Ali Boxing Reform Act.

Mikey Garcia sued Top Rank alleging issues with his contract including violations of the Muhammad Ali Boxing Reform Act.  The lawsuit was transferred to Nevada as Garcia originally filed in California.

Don King was found in breach of contract when his fighter failed a drug test for an event in Russia in 2014.

In addition to these lawsuits, there were major shakeups at Golden Boy with former CEO Richard Schaefer leaving Golden Boy.  But, it appears to be a messy divorce with Golden Boy seeking $50 million in private arbitration.

Just like MMA, 2015 should be an interesting year for boxing.

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