Cormier signs new fight deal with UFC

November 2, 2015

MMA Junkie reports that Daniel Cormier has signed an 8 fight deal with the UFC.

According to the article, he had 4 fights left on his previous deal.  The report also states that “there wasn’t much in the way of negotiating the new one.”  Cormier indicated he got what he wanted but did not disclose the details of the current contract.

Cormier, 36, successfully defended his light heavyweight championship against Alexander Gustafsson in September.  Initial reports state that UFC 192 headlining Cormier drew 250,000 PPV buys.

Cormier is set for a rematch with the returning Jon Jones sometime in 2016.  The Junkie article also indicates that Ryan Bader is also on Cormier’s list of opponents assuming he can get past Jones.

Cormier bristled at a showdown with Jones in New York’s Madison Square Garden (if the preliminary injunction in the UFC lawsuit there is granted) this April.

Payout Perspective:

Maybe the cynic in me recoils when I hear there “wasn’t much in the way of negotiating” with Cormier’s new deal.  Perhaps Cormier was not expecting a contract and the terms offered the security he wanted at this point of his career.  At 36 years old, Cormier has maybe one or two more years left of high level MMA left.  One would think that his contract also includes incentives.  If one of those is a PPV cut, I do not know how much more he’d make if his opponent is not named Jon Jones.  What the 8 fight deal does for the UFC is keep Cormier away from Bellator for a while.  Despite his advanced age, one need only look what Scott Coker and Bellator has done with the likes of Kimbo Slice, Ken Shamrock and Tito Ortiz to know that he is still a valuable asset for an MMA organization.

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.”

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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.

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

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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.

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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.

Plaintiffs get pre-discovery win in UFC antitrust lawsuit

October 1, 2015

As discovery begins in the UFC antitrust lawsuit brought by former fighters, plaintiffs attained a favorable ruling Wednesday as the court will allow one of the plaintiffs’ attorney, Rob Maysey, to access documents in discovery.  The UFC identified Maysey as a “competitor” and wanted him precluded from access to some of the company’s confidential documents in discovery.

Plaintiff filed a protective order to which UFC attempted to strike.  Magistrate Judge Peggy Leen ruled that the UFC could not keep plaintiffs’ attorney Rob Maysey from certain documents it would turn over in the discovery process.

Zuffa attorneys argued that Maysey was a competitor as part of a Mixed Martial Arts Fighters Association (“MMAFA”) as he may seek group licensing on behalf of UFC fighters.  Maysey stated in a sworn declaration that “he does not own the MMAFA,” nor head the organization.

Maysey stated in his declaration that he was the “principal client liaison” to the fighters. Notably, he did not indicate he was trial counsel.  In the end, it appears that the distinction made no difference to the Magistrate.

Judge Leen did not wall off Maysey from any part of the discovery process.  There is no official opinion from the magistrate (the magistrate sometimes serves as a discovery ‘referee’ as opposed to the trial court judge in federal cases) as to the rationale behind the decision.

The parties have engaged in discussions related to the exchange of documents between the parties.  Obviously, the key information is held by Zuffa.  From the exchange of information, it sounds like a voluminous amount of documents will be handed over to plaintiffs’ encompassing an expansive list of areas.

Specifically, based on a back and forth of letters between the parties’ attorneys, the main argument was the retention and eventual disclosure of documents possess by Zuffa from 2000 to the present.  Zuffa’s attorneys proposed a timeframe of 2010 to the present.  Thus, there was a dispute over 10 years worth of documents.  There was also a question over the preservation of emails as in the “parent/child” format or not.  Yes, they want to look at a chain of emails and their response…and that response…and the response after that…..

As Bloody Elbow lists, the information that plaintiffs seek relate to financial documents, fight contracts, venue contract files, sponsor contract files, merchant contract files, list of TV contracts, 3rd party/analyst consultant reports, FTC Strikeforce documents and list of litigations/arbitrations.

The document production will be done via some form of electronic discovery I presume.  To have the discovery performed via hand would be burdensome, unwieldly, time-consuming and downright difficult.

Thus, while discovery is starting, there is a proposal to have two phases to the production.  But before those two phases, there is a likely document compilation that is happening or already happened.  Basically, Zuffa has to upload documents into a database and run key word searches to find information relevant to what they are being asked.  The company isn’t just going to unload a ton of its private business documents without looking through them.  Moreover, it does not want to give plaintiffs more than it is asking for in their requests.

Thus, Zuffa will not just hand over the documents without review of them.  Obviously, Zuffa attorneys and/or their personnel will ensure that the documents are responsive and do not reveal confidential, private and/or attorney-client/work product.  They may produce docs but redact sections of them for an assortment of reasons.

From a practical standpoint, we presume there will need to be time taken for all of the documents to be amassed and scanned in to some sort of system (e.g., Concordance, KrollOnTrack, etc.).  There will be some third party vendor that will create a database for the parties.  Hence, providing documents in phases may be more a necessity than a proposal.

At that point, they can transfer them over to the plaintiffs who one assumes will have the same capabilities (i.e., databases) to review the documents and code them for responsiveness as well as make other types of notes.  One would assume that they will code them based on subject matter, etc.  This will  help later on as when they go to deposition, they will run key word searches for relevant material and pull them out without digging around for hours.

In all likelihood, we will see additional back and forth related to the discovery requests.

All of the written discovery and production of documents will occur before any deposition for the obvious reason that attorneys will want to have all of the documents before them before deposing a witness.  You only get one “bite of the apple” to depose someone (only in the most extreme circumstances can you get two shots to depose a witness).  Expect the depositions of some of the key Zuffa executives such as Dana White and Lorenzo Fertitta as well as the fighters to last days.

Payout Perspective:

While many people are very excited for the news of the UFC revealing their financials, I would not expect a “smoking gun” document or an “a ha” moment any time soon.  Assuming there is information that Zuffa believes should remain confidential, and that plaintiffs believe they should have, there will be extensive “meet and confers” and even motions before the magistrate.  Get ready and wait.

UFC announces details of drug testing policy

June 3, 2015

The UFC announced details of its new drug policy at a press conference Wednesday.  The United States Anti-Doping Agency will take the reins as a third-party administrator for the UFC policy.

The new rules will take effect July 1, 2015.

Among the new shift in policy is that contracted UFC fighters will be subject to year-round in-and out-of-competition drug testing which includes blood and urine testing regardless of where they are located and whether or not they are scheduled to fight or not.

Jeff Novitsky, Lawrence Epstein, Lorenzo Fertitta and Dana White were at the press conference to announce the new policy.  USADA was represented by Travis Tygart and former Olympian Edwin Moses.

USADA will take the lead on administering the testing of UFC fighters.  The UFC will have no input on the testing process.

MMA Fighting provides a breakdown of the penalties (which were shown as slides at the press conference) which are defined by the WADA code.

Non-specified substances which include anabolic steroids, growth hormones, peptides, blood doping drugs and methods:

1st offense – 2 years (possibility of 4 years for “aggravating circumstances”)

2nd offense – Double the sanction for the 1st offense (possible of 8 years max)

3rd offense – Double the sanction for the 2nd offense (possible of 16 years max)

Specified substances which include marijuana, cocaine, other stimulants and glucocorticosteroids (tested for in-competition only):

1st offense – 1 year (with possibility of 3 total for “aggravating circumstances”)

2nd offense – Double the sanction for the 1st offense

3rd offense – Double the sanction for the 2nd offense

Novitsky, the UFC’s Vice President of Athlete Health and Performance indicated that the UFC is not a signatory to the World Anti-Doping Code and is not subject to the Court of Arbitration for Sport (CAS) to appeal any decision or finding by USADA.  Novitsky did not indicate the UFC’s appellate process although you might assume that it is through the American Arbitration Association.

Payout Perspective:

The overarching question that many will ask is whether or not the new drug policy circumvents the independent contractor status of fighters.  The key buzz words that would make anyone take notice is “unannounced” and “year-round” drug testing.  The new policy would give Zuffa (and thereby USADA) the right to make fighters provide them of their whereabouts whether or not they have a fight schedule or not.

Certainly, there are several issues that still stand out regarding the implementation of the drug testing policy.  The question of whether commissions and athletic regulatory bodies would uphold suspensions of UFC contracted fighters is an issue.  What happens when there is a conflict of suspensions?  How will the policy be enforced when the UFC goes overseas?  Since it is not subject to CAS, what will an international appeals process look like?  Also, would competing MMA organizations follow suit in implementation of drug testing policies?

Will any fighter seek to oppose this new policy?  While the move is a step in the right direction to ensure the integrity of the sport, fighters appear to be giving up a lot of their privacy.

There is a lot to unbundle by July 1st.

Kovalev-Stevenson will not happen this year

April 17, 2015

While we’ve seen Al Haymon’s Premier Boxing Champions come out to mainly positive reviews as his promotion is seemingly everywhere, there is still acrimony between rival promoters due to network affiliations.  Take the ongoing struggle between representatives for Adonis Stevenson and Sergey Kovalev.  Recently, Kovalev’s promoter withdrew from its purse bid for a chance to fight Stevenson later this year.

The two fighters are considered the best light heavyweights out there.  A fight between the two would unify the alphabet soup of boxing titles.  Kovalev is the IBF-WBA-WBO champion and Stevenson holds the WBC title.  The fight was thought to occur sometime in the “fourth quarter” of 2015 after a mandatory title defense by Kovalev sometime this summer and another by Stevenson.

Kevin Iole of Yahoo! Sports reported earlier this week that Kathy Duva, CEO of Main Events, and the promoter for Kovalev decided against a WBC-mandated purse bid.  Previously, Duva requested a Kovalev-Stevenson showdown and a 50-50 purse split.  But, Kovalev is an HBO exclusive fighter which posed an issue.  Haymon backs Stevenson and you might infer he has the money to make a fight which could draw as much, if not more than a Kovalev fight.

Stevenson’s camp indicated he would entertain the thought of fighting on HBO only if Main Events won the purse bid.  But, that would be only if Main Events would be the highest bidder.

In a letter to Kathy Duva, Stevenson’s manager, Yvon Michel claims that Kovalev must have renewed an agreement with HBO based on alleged statements from Duva that Kovalvev was near the expiration of his HBO contract.  Also, in his letter to Main Events, Michel indicated that Stevenson’s fight on CBS drew 1.7 million viewers and peaking at 1.85 million.  This fact, Michel claimed, showed that Stevenson was more popular than Kovalev since none of his HBO fights have ever garnered that amount of viewers.

Of course, CBS is available in more homes than the premium cable subscription network of HBO.

In addition, any fight Stevenson participates in, his management group wants to hold in the fighter’s native Quebec where the group has made monetary guarantees based on his popularity.

Duva has responded to the allegations citing there are still many uncertainties in putting down a purse bid at this time.

Payout Perspective:

If you are looking for another rivalry in boxing where the two sides cannot agree to terms for a fight, you may look to this one. The two promoters have had a bitter relationship stemming from the attempts to make this fight.  Last year, Main Events sued Stevenson, Michel, Al Haymon among others claiming that Kovalev had a deal to fight Stevenson but then the deal was nixed after Stevenson signed on with Al Haymon as his advisor.  The lawsuit was later dismissed but it appears that the bad feelings remain. We will see if this fight will get done quicker than the one occurring on May 2nd.

14 for 14: No. 14 Gil re-signs with the UFC

December 25, 2014

Back in February, Gilbert Melendez re-signed with the UFC after it was initially reported that he had agreed to a deal with Bellator.  But, the UFC exercised its “right to match” in Gil’s contract.  The move showed a newfound Bellator strategy to become more competitive with the UFC

Melendez became a free agent after his contract with Zuffa ended with his fight against Diego Sanchez at UFC 166.  Melendez was given offers from Bellator and the WSOF.  It was thought that Bellator had secured the lightweight but the UFC agreed to match the terms of the Bellator deal.  Melendez also received a title shot for the lightweight title and became a coach on TUF opposite Anthony Pettis.

Via MMA Fighting:

Per the terms of the agreement, according to several sources, Melendez’s deal guarantees that at least 75 percent of the 31-year-old’s fights will be contested on pay-per-view moving forward. Additionally, income earned from Melendez’s contracted pay-per-view points will kick in at a lower minimum buy rate than for any contract in UFC history, meaning Melendez will still earn pay-per-view point earnings on an event that performs poorly at the box office.

Payout Perspective:

The Gil deal makes the list because it revealed some key points that his representation was able to get on his behalf.  This drew the envy, of some fighters.  Shortly after Gil’s deal, Nate Diaz went on a twitter rant about his unhappiness with his UFC contract and asked to be released.  Gil’s deal was a rare example of fighter leverage and the invocation of the “right to match” clause.  We recall the problems occurring with this in the Eddie Alvarez legal battle.  Here, there were no problems, and in fact, Gil made out well.  Of course, his next fight was a loss to Anthony Pettis at UFC 181.  He made a base of $200,000 and should receive PPV points from the PPV buys.

With the recent UFC lawsuit filings in San Jose, new uniform deal, potential new sponsors in the UFC and the rise of Bellator, it will be interesting to see if/when another top free agent comes up, how the UFC deals with the negotiations.

Pacquiao-Top Rank renew contract

May 22, 2014

ESPN reports that Manny Pacquiao has signed a two year extension with Top Rank Boxing.  The deal will go through December 2016 and likely ends talk of a possible Pacquiao-Mayweather fight.

Top Rank Promoter Bob Arum indicated that the financial terms were not disclosed due to a confidentiality agreement.  The deal also extends MP Promotions which co-promotes Pacquiao along with Top Rank.  Mayweather is halfway through a six fight deal with Showtime.

Payout Perspective:

The new deal apparently closes the door on the biggest fight in boxing that never happened.  Let’s face it, the fight everyone wanted to see went away years ago.  Pacquiao will be 38 when this contract ends and it would be prudent for him to retire at that point.  Mayweather has expressed interest to walk away as well after his Showtime contract is up.  While Arum has stated that there still may be a chance for a Pacquiao-Mayweather fight, its unlikely we would want to see it at the end of their respective careers.

Alvarez contract states Chandler rematch next despite Brooks win

May 19, 2014

The MMA Report reports that Eddie Alvarez’s contract has him specifically fighting Michael Chandler.  The apparent clause in the contract would leave Bellator without the opportunity for Alvarez to fight interim champion Will Brooks.

You will recall that Bellator and Alvarez were embroiled in a contentious legal battle which was finally settled.  Although terms of the settlement were not revealed to the public, it appears that Alvarez specifically had set his sights on Michael Chandler.

In the post-Bellator 120 press conference, Bellator CEO Bjorn Rebney stated that Alvarez’s next fight will be on PPV although the issue of Alvarez’s next opponent may be a factor prior to what platform the fight will be shown.

Payout Perspective:

Here we go again with contract issues.  It’s hard to comment on a contract without first seeing it but from what we know from The MMA Report’s report it seems like Alvarez and his camp believed that Michael Chandler was the only opponent for Alvarez.  One would think to ensure that Alvarez fought the champion of the division, his contract would not specifically name an individual, but just that he would face the champion in the lightweight division.  With the Will Brooks upset, Alvarez now is contractually obligated to face Chandler in what would be an entertaining, yet meaningless fight for Bellator’s lightweight division.  Of course, Bellator could persuade Alvarez to take on Brooks and unify the titles.  Alvarez, in one last shot at the company, could decline the offer and take on Chandler.

The Chandler fight still seems like the one that would draw more PPV buys (assuming it’s on PPV), but the Brooks fight would make more sense since there are now two titleholders at 155 and Bellator would probably want to unify the titles as soon as possible.  In the end, Alvarez’s advisers will probably go with the fight that provides the most money for Alvarez.

UPDATE 5/20/14:  In accompanying this post, you should also read Will Brooks recent twitter timeline and John Nash’s piece on Bellator contracts on BE.  I would suspect that Alvarez’s negotiated settlement of his lawsuit included that his contract with Bellator not have a “Champions” clause which may cause him to continue to stay with the company.

CSAC rules Rousey released from fight contract

April 4, 2014

Sherdog’s Mike Whitman first reported that the California State Athletic Commission issued its ruling in the arbitration of Ronda Rousey and Fight Tribe Management.  The commission ruled that Rousey is released from her fight contract but left the commercial aspect of the contract to the court.

Executive Director of the CSAC, Andy Foster heard the arbitration between the parties last week over the dispute between the UFC women’s bantamweight champion and her manager Darin Harvey.  Originally, Harvey had petitioned the Los Angeles Superior Court for the issue regarding the representation agreement between the parties to be decided via arbitration.  However Rousey’s legal representatives claimed that the contract should be determined by the CSAC.  The arbitration was held on March 28 with Foster serving as the arbitrator with the assistance of two attorneys from the AGs office.

Harvey claimed that the representation agreement was drafted as a talent contract and not a fighter-manager contract.  Regardless, Rousey’s attorneys argued that the representation agreement was void under California law.

The facts stated that Rousey and Harvey entered into a 3 year agreement starting on May 15, 2012 and signed on January 29, 2013.  Harvey would receive 10% of Rousey’s income generated from professional fighting, modeling, acting and other commercial activities.  However, the CSAC determined that the agreement “was not prepared on the required, pre-approved forms, nor did both parties appear before the commission at the same time in order to receive the commission’s approval, thereby invalidating the agreement as a fighter-manager contract in California.” (quote via Sherdog)  The CSAC ruled that Harvey was not a “manager” as defined under Business and Professions Code section 18628

The CSAC left open the issue as to the “commercial activities” that were incidental to “fighting activities” to the court.  So, it’s likely that we have not heard the last of this dispute.

Payout Perspective:

MMA Payout will have more on this decision as it becomes available.  The initial read from Sherdog’s report reflects the fact that this contract dispute is not over.  It’s interesting to note  that based on the information available, Harvey sought his manager fee from “commercial activities” which may have been a conflict with Rousey’s agents at William Morris. We note that Rousey signed Fight Tribe’s agreement on January 29, 2013 and then signed on with William Morris in late February 2013.  Whether this was coordinated by Harvey and/or the relationship between Fight Tribe and William Morris became strained over time is an issue that may play out in court proceedings.

Rousey’s management requests arbitration over undisclosed contract issue

March 13, 2014

MMA Payout has obtained documents which shows that Ronda Rousey and her management team are in a dispute over its representation of the UFC women’s bantamweight champion.  Darin Harvey, President of Fight Tribe Management filed a Petition to Compel Arbitration in LA Superior Court last Friday against Rousey.

The documents filed by Fight Tribe Management, LLC request that the Court Compel Arbitration and seek that the briefing in this matter be sealed.  If the Court grants the Application to seal, the documents will unlikely be available to the public.  In his Declaration in Support of the “Application to Seal Briefing,” Darin Harvey states that the terms of the Representation Agreement with Rousey are confidential and cites two clauses in their agreement which support his request.  He indicates the contract states financial disclosure of their agreement is to remain confidential “without the prior written consent of the other Party” unless it is required by law.  It further cites a clause indicating that any dispute over the agreement should also be confidential in its attempt to resolve it.

Sherdog’s Mike Whitman spoke with Rousey’s legal representation in this matter and indicated that there may be an issue as to whether a private arbitrator can resolve the matter or whether the California State Athletic Commission should be in charge of resolving this dispute.  Rousey’s attorney, Steven Bash indicated that the dispute is governed by the California State Athletic Commission and the California Business and Professions Code.  Bash stated that he has yet to file a response and could not give specifics on the nature of what it would be.

Payout Perspective:

This will be an interesting legal fight that we will follow.  Rousey’s lawyer states that the dispute should be resolved under the rules of the California State Athletic Commission while Fight Tribe Management has filed to compel arbitration in Superior Court.  We might see an initial dispute over that procedural issue.  There are rules for managers and fighters under the CSAC but whether they apply to this situation is not known due to the confidentiality of the dispute at this point.

There are arbitration provisions under Article 3, §227 of the California Code of Regulations which relate to contractual issues.  These relate to boxers but we might assume that MMA fighters would fall under this provision.  However, it does not look as though there are rules which would seal briefing (unless the parties agree pursuant to the terms in the agreement in dispute).  The rules state that the parties would have to furnish the contracts that are in dispute at the arbitration hearing.

MMA Payout will keep you posted.

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