McGregor in midst of $100M deal with UFC?

May 22, 2016

Conor McGregor told ESPN’s Kenny Mayne, in the network’s trademark “Sunday Conversation” that he is in the midst of a $100 million deal with the UFC.  In the interview, he opened up about the “retirement” tweet, the UFC and Floyd Mayweather.

Whether or not you believe this to be true, the deal is likely the biggest fight contract for a UFC fighter in the company’s history.

Assuming what McGregor is saying is true, the deal is likely for 8 fights which would amount to approximately $12.5 million per fight not including any PPV upside or other performance-type bonuses.

The interview includes talking about the “proposed” fight between Floyd Mayweather, Jr. and the Irish MMA fighter.  The latest in that saga is Mayweather offering $50M to McGregor.  In his ESPN interview, McGregor proclaimed that Mayweather needs him, not the other way around.

Payout Perspective:

I would suppose that McGregor and the UFC would be working on a new contract (or revising the old one) which would mean more fights and more money.  I also think that the contract would be much more in-depth and detailed than your standard boilerplate contract with the UFC.  Namely, it would detail the terms of his promotional schedule.

The subtle thing here is that McGregor is giving ESPN’s Kenny Mayne this exclusive interview and not Fox or FS1 doing this.  Obviously, it would be more advantageous for ratings if FS1 were to do this interview rather than ESPN.  But, as we’ve seen, when big news occurs for the UFC, ESPN is the first to report.

Sterling chooses to re-sign with the UFC

February 15, 2016

Aljamain Sterling announced that he is re-signing with the UFC.  The bantamweight was a free agent after his fight this past December and while there was much speculation about where he would sign he has decided to remain in the UFC.

Sterling made the announcement on The MMA Hour.  He said that he got a better deal by waiting for free agency.  Sterling feels confident about his skills and adding value to the company.

Although no terms were disclosed, Sterling signed in with the UFC in January 2014 when he accepted a four-fight contract at $8K/$8K with a $2K increase if he won.  According to an article with Bleacher Report, Sterling says the UFC offered him a raise to $20K/$20K.  But, he declined the offer and fought out the last fight of his contract.  He was subsequently offered $24K/$24K by the UFC but declined that offer too.

In addition to Sterling’s choice to stay with the UFC, Heavyweight Alistair Overeem decided to re-sign with the UFC as well.

Payout Perspective:

Do you think that the UFC blew Sterling out of the water with their offer or did he not receive a better offer from a rival organization?  One would think that Bellator could have used the money it spent on signing Chris Leben to sign Sterling.  He could have bolstered that division and been an instant rival for the likes of Joe Warren.  Re-signing with the UFC probably means that in addition to more money, Sterling will get better, higher-profile fights.  With a raise, perhaps Sterling will get some prime fights at bantamweight and maybe headline a Fight Night.  He is a likable, charismatic person that can finish a fight.  We shall see what the company does with him.

Coker not taking Brooks comments personal

February 14, 2016

MMA Fighting reports on Scott Coker’s response to lightweight champion Will Brooks’ criticism of the organization for not promoting him versus others within the company.

Brooks, according to his twitter account, plans to fight out his contract with Bellator.  The insinuation is that he is going to head into free agency and look for a better deal than what the Viacom-owned company is offering him.

Rather than fight Brooks in the media, Scott Coker state that he’s not taking it personally and that Brooks’ feelings are “part of the business.”  Coker indicated that Bellator would make an offer to Brooks but did not go as far as to say they would go out of their way to re-sign him.

Payout Perspective:

With Benson Henderson coming into Bellator, could its current lightweight champion be leaving?  Brooks presents an interesting case since he’s a current champion.  One would think that the Champions Clause might prevent Brooks from leaving the company cleanly.  We will see if that happens (or if Brooks has this clause in his contract).  But, Coker is playing this well.  He’s not getting personal and is complimentary of Brooks despite his dismay with the company.

Holly Holm signs new deal with UFC

January 3, 2016

ESPN reports that Holly Holm has signed a multiyear contract extension with the UFC per Holm’s manager Lenny Fresquez.  Financial terms of the deal were undisclosed.

Holm was in attendance Saturday night at UFC 195 and inked the deal on Saturday.  Per ESPN, it is not uncommon for the UFC to sign a newly crowned champ to a new deal.

According to disclosed salaries by the California State Athletic Commission, Holm was at $25K/$25K at UFC 184 and July 2015’s UFC Fight Night 71.  One would suspect that Holm will receive a significant boost in pay with the potential for PPV points.

Payout Perspective:

Maybe we get further details in the coming days as to how long the contract is for Holm.  It appears that most re-ups are for 8 fights thus making the deal “multiyear.”  Hopefully, Holm received a deal comparable to her new status as the top woman’s fighter in the UFC.  With a potential fight coming with Miesha Tate and a rematch with Ronda Rousey in the not too distant future if she gets past Tate, Holm is positioned to usurp the position Rousey has held since 2013.

Werdum signs new 8 fight deal with UFC

December 16, 2015

MMA Fighting reports that UFC Heavyweight Champion has signed an 8 fight contract with the UFC.  The deal is worth “seven figures” according to UFC Tonight’s Ariel Helwani who talked to Werdum’s manager Ali Abdel-Aziz.

“They didn’t have to do a new deal.  We’re very thankful. [Werdum] wants to end his career as a UFC fighter, and the UFC was extremely supportive and generous,” said Abdel-Aziz about the new 8 fight deal for the 38 year old.

It was announced last week that Werdum would face Cain Velasquez in Las Vegas at UFC 196 during Super Bowl Weekend.

Werdum’s last official reported payout was at UFC on Fox 11 in April 2014.  He made $175,000 which includes a $50,000 win bonus.

Payout Perspective:

Obviously, the vagueness of “seven figures” could be a modest amount per fight or substantial.  The issue, is that at 38, Werdum is unlikely to fight through the rest of the contract.  It is interesting that Werdum and Daniel Cormier were happy with signing new long-term deals despite their advanced ages.  The UFC may have locked them in just to ensure that they do not go to Bellator.

Henderson set for free agency?

November 29, 2015

With his split decision win over Jorge Masvidal this past Saturday in South Korea, Benson Henderson became a free agent.  At the end of his contract with the UFC, Henderson appears set to test the free agency market of MMA.  What will he find?

The former WEC and UFC lightweight champion is an attractive competitor for any organization.  Bellator comes to mind when thinking of other organizations that might have the bankroll and notoriety to make a run at Henderson.  Other fighters such as Phil Davis and Josh Koshcheck have made the jump from the UFC to Bellator.

I would argue that Henderson is a bigger free agent than Davis or Koscheck.  He can still pull off some exciting fights and it’s a matter of what organization will compensate him for what he believes he is worth.  At 32 years of age, he still has some time left in the sport where he can still fight at a high level.

Perhaps it is fitting that Henderson’s last fight was in South Korea.  Henderson, who is half Korean, wanted to fight in Korea, his mother’s homeland.  If it was his last fight for the UFC, it was a good way to send him off.

Although Henderson indicated that he’d retire in the UFC, it doesn’t mean he would fight the rest of his career in the company.

Henderson made the most in the UFC when he was the lightweight champion.  He made $110,000 when he dropped the championship to Anthony Pettis in August 2013. Prior to that, he made $100K/$100K in a split decision win over Gilbert Melendez in April 2013.

His last reported purse was $48,000 this past January.  He also made $48,000 in a loss to Rafael dos Anjos in August 2014.  He started out $17,000 and $17,000 for the UFC in August 2011.

It would not be a stretch to say that Henderson would want to improve upon his current $48K/$48K status.  While he may be able to make up enough of his salary through sponsors (assuming he does not return to the UFC), he would probably want to fight in an organization that could provide him TV exposure and quality fights.

Certainly, Bellator could provide Henderson with both exposure and fights.  Henderson would be one of the top-named stars for the Viacom-owned company and would be a possible headliner the company could target if it intends to expand into Asia.

The other organization that might target Henderson is the Asian-based One FC.  Although a long shot, Victor Cui’s organization is big in Asia with sponsors and tv deals.  Of course, the company is not in America.

Henderson’s situation is uncommon in MMA.  The UFC has tied up some of its fighters to lengthy contracts (e.g. Paige VanZant , Daniel Cormier and Chad Mendes come to mind).  The UFC has matching rights in most of its fight contracts which allow it a right to match any offer made by another organization in order to keep the fighter.  Henderson has some value and leverage in negotiating with other organizations which may cause the UFC to make a tough decision.

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.

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