Cung Le suspension lifted by UFC

October 21, 2014

The UFC announced Tuesday that it has rescinded the 12 month suspension of Cung Le.  The news comes as a surprise considering Le and the UFC were heading to arbitration over the suspension.

Via UFC.com:

At UFC Fight Night Macao on August 23rd, UFC contracted with an independent drug testing laboratory in Hong Kong to perform urinalysis testing on all fighters on the card.  Additionally, UFC requested the laboratory to test blood samples from 4 fighters for human growth hormone (HGH), erythropoietin (EPO) and testosterone.

One of the athletes who had his blood tested was Cung Le.  The laboratory results from Le’s blood test were sent to the UFC and showed that his blood had a total HGH level outside the reference range.  Based on such results, UFC officials determined that Le had violated his promotional agreement and the UFC Fighter Conduct Policy.  Consequently, UFC decided that Le should be suspended from unarmed combat competition for 12 months.

Following the announcement of Le’s suspension, UFC officials have been provided with medical advice regarding the elevated total HGH present in Le’s system.  In accordance with such medical advice, UFC has determined that Le’s elevated total HGH by itself does not prove that he took performance-enhancing drugs before the August 23rd bout.  As a result, UFC has informed Le that his suspension is rescinded.

Le had requested an appeal of his suspension, and was entitled to arbitrate the drug test results and suspension.  However, based on the lack of conclusive laboratory results, UFC officials deemed it appropriate to immediately rescind the suspension without the need for further proceedings.

The UFC organization has always been a leader when it comes to testing for performance-enhancing drugs in combat sports.  All UFC athletes know they are subject to drug testing by an applicable state athletic commission, an international governing federation, or by an independent laboratory contracted by the UFC when no regulatory body is overseeing the event.  In those cases where regulatory oversight is unavailable, UFC voluntarily chooses to adhere to the highest level of athlete health and safety protocols similar to if the event were being held in the state of Nevada.

Payout Perspective:

It’s clear that the UFC did not want to go to arbitration as it would have likely exposed the UFC’s drug testing policy (or lack thereof).  Le’s attorney Steve Pacitti and manager Gary Ibarra stuck with the situation despite the overwhelming public perception that Le was guilty.  Of course, the rescission does not mean that Le was not guilty of taking illegal substances, it’s just that the process for testing this was faulty.  As an advocate for Le, Pacitti and Ibarra spelled out Le’s case with the facts of the situation.  Namely, the lab that gathered the samples was not a WADA-approved lab.  Also, the taking of the sample from Le occurred at a time when his hGH levels were naturally high and a WADA required test was never conducted on the sample.  All of this information appears to have mounted in favor of Le and the UFC’s decision to rescind the suspension.  With the suspension lifted, we will see how ready the UFC will be to book Le for another fight.

The UFC must recognize that its current drug testing policy is shaky at best.  The fact that it was unclear what process for appeal Le had reflects the need for the company to sit down and spell out a comprehensive policy for its fighters.

Standard & Poor’s downgrades Zuffa, LLC from BB to BB-

October 10, 2014

Standard & Poor’s has downgraded Zuffa, LLC’s credit rating from a “BB” to a “BB-“ this week as a result of what it calls “greater EBITDA volatility.”  However, the analyst report states that the outlook for company is stable.

Standard & Poor’s issues credit ratings for the debt of public and private companies.  It is one of several credit-rating agencies that has been designated a nationally recognized statistical rating organization by the Securities and Exchange Commission.

In its overview, S&P concluded that Zuffa “will experience a 30% decline in EBITDA (Earnings Before Income Tax, Depreciation and Amortization) in 2014 and greater EBITDA volatility over time than we previously had anticipated.”  Despite the gloomy outlook, it stated that Zuffa’s outlook is stable and 2015 will be a recovery year for the company.  This is based on the belief that injured fighters return and PPV buys and ticket prices increase.

For those wondering, as I have in the past, EBITDA is an accounting measure calculated using a company’s net earnings, before interest expenses, taxes, depreciation and amortization are subtracted as a proxy for a company’s current operating profitability.

The report identifies Zuffa having $535 million in credit with $60 million in “senior secured revolving credit facility due 2018 and a $475 million senior secured term loan due 2020.”

Zuffa’s credit rating had maintained a “BB rating” since December 2010.  It was previously downgraded in November 2007 from BB to BB-.

Other notes:

- In 2013, the revenues for Zuffa were split 58% event-based (i.e., PPV and ticket sales) and 42% from TV, sponsorships, merchandising, licensing and content distribution agreements.

We note that last year’s S&P report had the company’s 2012 revenue at 55% event-based (including PPV and live gate) with the other 45% dedicated to TV revenue, sponsorships, merchandise, licensing and content distribution agreements.  Thus, a slight increase in revenue geared toward events rather than other streams.  This is interesting considering the report finds the broadcast deals to be a more stable revenue provider than PPVs and live event gates.

- There’s an expectation that debt to EBITDA will increase to the high-4x area compared to the low 3x area previously.

We should also note that there was no mention of how Fight Pass impacts its revenue unless you consider it falls under content distribution agreements.

Payout Perspective:

There’s nothing earth-shattering in the report despite the downgrade in credit rating.  The silver lining for Zuffa is the S&P report believes that 2015 should be a recovery year dependent on key fighters coming back which the report suggests will mean higher PPV buys and gates.  The report lists the international expansion and the broadcast deals as positives for the company and even suggests a more stable form of revenue than the PPV model.  Still, the company is based on its events and fighters and the report indicates that injuries and juggling of events due to key injuries to fighters is directly related to the downturn in its business.  I should also note that the report never suggests that there is an oversaturation of the product that contributes to its current business climate.  One might argue that fighter injuries/juggling of events is related to too many events too close together but the report does not address this possibility.

It is ironic that there are reports that the UFC office in China is closing when the S&P report identifies international expansion as a key to produce additional revenue for the company.  Also, the report stresses the need for more fighters that will appeal to its core youth demo the same week that the Sports Business Journal comes out with a report that the company is in search for more stars.

What a week for the UFC.  The UFC’s credit rating is downgraded, Cung Le will appeal the UFC’s suspension which could reveal a rather shaky drug testing policy, the UFC reportedly closes its office in China and a former UFC fighter live-tweets a standoff with a SWAT team.  What a week.

Sports Business Journal lists UFC’s top PPV draws

October 6, 2014

Bill King of The Sports Business Journal reports on the UFC’s need for its next PPV star.  It has compiled a list of the top PPV draws in its history and the top of the list may (or may not) surprise you.

Although we cannot produce the entire list and/or article, it can be seen in this week’s Sports Business Journal’s issue which is through subscription only.

The list compiled by the SBJ factors in fighters’ PPV draws based on them fighting as one of the top two fights on a card dating back to January 2006.  Per the SBJ process, the list includes only fighters who were co-featured in at least three bouts and looks at their PPV averages as the headliner.

The top of the list has Brock Lesnar, GSP and Rampage Jackson who narrowly edged Chuck Liddell for the third spot.  To show how significant Lesnar was as a PPV draw, his average as a headliner (which can also be found at MMA Payout’s Blue Book), is at 1,021,000.  GSP, who ranked second, averaged slightly over 688,000 PPV buys.  Jackson averaged 613,000 and Chuck Liddell placed 4th and averaged 605,000.

The rest of the top 10 in order goes Tito Ortiz, Rashad Evans, Lyoto Machida, Randy Couture, Anderson Silva and B.J. Penn.

Cain Velasquez, Jon Jones and Ronda Rousey missed out on the top 10 spot.

One interesting fact from the article:  UFC PPV business went from 45% of the UFC’s revenue in 2009 to 30 % in 2013 but the overall business grew by about 50% driven by international TV rights.

Payout Perspective:

The article is a very good analysis of what the UFC is facing with more shows and less draws for its PPVs.  If you are to look at the top 10, only Lyoto Machida may be considered as active on the UFC roster (hard to think Evans will be a headline on a PPV in the future).  The UFC has to hope (and think) that Cain, Jones and Rousey will surpass some of those names in the top 10s as they continue to star on PPV.  One ominous point shown from the SBJ article is that Demetrious Johnson’s 3 main events on PPV had him pull in an average of only 175,000.

Report: UFC 177 nets 125K PPV buys

October 2, 2014

Dave Meltzer of The Wrestling Observer (subscription recommended) reported that UFC 177 which featured T.J. Dillashaw defending his bantamweight championship against late replacement Joe Soto netted an estimated 125,000 PPV buys.

The numbers are more than most had expected considering that Soto replaced Renan Barao the day before the fight.  It’s the second lowest output this year but considering the circumstances, the reported number is a pleasant surprise.

Going into the Saturday of UFC 177, there was concern that it would beat UFC 174 for lowest PPV buy rate in years.

UFC 2014s PPVs

Payout Perspective:

I was of the opinion that this number would never come out due to the potential for a disastrous PPV number.  The Google metrics that many go by in anticipating a buy rate were non-existent.  However, if correct, the 125,000 PPV buys reflects that there is a base (as discussed by Meltzer and Bryan Alvarez on their podcast) audience that will order UFC PPVs regardless of the fights on the card.  Realistically, the advertised card rivaled a Fight Night card with the exception of a title fight.

UFC 178: Payout Perspective

September 29, 2014

Welcome to another edition of Payout Perspective.   In this edition, we review UFC 178 which took place at the MGM Grand Garden Arena where Demetrious Johnson took on Chris Cariaso in the main event.

Johnson outclasses Cariaso

Despite the lack of fan support (i.e., PPV buys), Demetrious Johnson can legitimately stake a claim to being the best pound for pound fighter in the UFC.  It was clear in the first minute that Johnson was the better fighter and ended Cariaso in the second round with a submission.

Johnson is getting prime placement on UFC shows and it’s the second PPV he’s headlined this year.  One should also stress the fact that Johnson has not been hurt during his title reign and is not an outside-the-Octagon problem.  So, why don’t people buy his PPVs?

UFC_178_event_poster

Cowboy welcomes Eddie to UFC

The skeet shooting and wakeboarding training regimen pre-fight aside, Donald Cerrone is an extremely good fighter.  In what was one of the more entertaining fights on the card, Cerrone defeated Eddie Alvarez.  It was the long-awaited debut for the former Bellator champ and the first round he showed why the UFC wanted to acquire his services.  Yet, Cerrone moves on looking for another fight before 2014 closes.

McGregor makes quick work of Poirier

You would have thought that this was the main event based on the crowd reactions.  The hype, trash talk and vitriol between the two (especially during any face off promoting the fight) was classic in what to do to have people interested in purchasing your fights. The Conor McGregor experience continues and likely his most impressive fight on the biggest platform so far.  McGregor easily handled Dustin Poirier in the first round.  It’s clear that McGregor is ready for a title shot after Saturday night.

Attendance and Gate

The attendance and gate announced at the post-fight press conference was 10,544 for a gate of $2.2 million.  Out of 9 PPVs this year, it ranked 7th in attendance.

Bonuses

The bonuses of $50K each were awarded to Yoel Romero-Tim Kennedy for Fight of the Night and Dominick Cruz and Conor McGregor for Performances of the Night.

Promotion of the Fight

The Embedded episodes continue to be popular as the UFC has found a formula to promote the fights digitally.  For the most part, viewers got to see Cowboy Cerrone wakeboarding and skeet shooting prior to his fight with Eddie Alvarez, Conor McGregor get a haircut, Demetrious Johnson getting a shave and Dustin Poirier at the Whole Foods at Vegas.  The one thing really missing from the embedded episode was a profile on Chris Cariaso.  The Countdown show did have a profile on Cariaso but it seemed incomplete.  Even if it was a foregone conclusion that he would likely lose (which happened), it would have been nice for them to have elevated his profile for this fight.  It seems to get better reviews than the UFC Prime Time episodes because they are short and can be viewed whenever people want to see them.

Conor McGregor did a good amount of pre-fight press.

Mighty Mouse appeared on the local Fox affiliate in Seattle last week hyping UFC 178.

Salaries

Salaries have been disclosed via MMA Junkie:

Demetrious Johnson: $183,000 (includes $54,000 win bonus)
def. Chris Cariaso: $24,000

Donald Cerrone: $126,000 (includes $63,000 win bonus)
def. Eddie Alvarez: $100,000

Conor McGregor: $150,000 (includes $75,000 win bonus)
def. Dustin Poirier: $34,000

Yoel Romero: $58,000 (includes $29,000 win bonus)
def. Tim Kennedy: $70,000

Cat Zingano: $18,000 (includes $9,000 win bonus)
def. Amanda Nunes: $15,000

Dominick Cruz: $100,000 (includes $50,000 win bonus)
def. Takeya Mizugaki: $32,000

Jorge Masvidal: $90,000 (includes $45,000 win bonus)
def. James Krause: $15,000

Stephen Thompson: $32,000 (includes $16,000 win bonus)
def. Patrick Cote: $33,000

Brian Ebersole: $42,000 (includes $21,000 win bonus)
def. John Howard: $21,000

Kevin Lee: $20,000 (includes $10,000 win bonus)
def. Jon Tuck: $10,000

Manny Gamburyan: $50,000 (includes $25,000 win bonus)
def. Cody Gibson: $10,000

Some notes:

Some interesting figures including Demetrious Johnson being paid like a champ (base of $129K).  The last official report of his purse was at UFC on Fox 9 where he made a base of $125K (notice a bigger bonus for that Fox event).  You might assume that June’s UFC 174 he made a base of $127K although those salaries were never officially reported.  Eddie Alvarez was paid $100K (show) for his first UFC fight.  You might recall when he was originally offered a UFC contract which precipitated the Bellator lawsuit, he was offered $70K for his first match in the UFC.  Conor McGregor is already up to $75K base.  Cat Zingano only made $9K/$9K which is only a $2K bump from her last fight in April 2013 against Miesha Tate.

Sponsors

The octagon sponsors included MusclePharm, MetroPCS, Alienware, Harley Davidson, Toyo Tires, Fram, UltimatePoker.net, Assassin’s Creed’s latest game, Matefit.me and Bud Light in the center.

Missing from the octagon was long-time sponsor, Xyience, which was purchased by another company that quickly pulled the sponsorship with the UFC.

Yoel Romero was sponsored by likeaboss.com.  I’m not sure what they do.

Cain Velasquez appeared in a promo for Harley Davidson Motorcycle’s “Hometown Throwdown.”

Mighty Mouse had his traditional sponsor of Xbox 360.  The only sponsor for Johnson, his fight banner told folks to pre-order an Xbox One.  I thought those were already available?  If you were wondering, on his recent Wrestling Observer podcast, Dave Meltzer did not know how much Johnson is receiving from Microsoft.

Cariaso was sponsored by Mountek.  Really.

Dominick Cruz was sponsored by the Phoenix International Raceway which stuck with him despite Cruz being on the shelf for a long time.  It paid off as PIR had a prominent logo on Cruz as he was demolishing Takeya Mizugaki.  He also wore the shirt in his post-fight interview.

Odds and ends

-Didn’t mention this earlier, but Cat Zingano-Amanda Nunes fight was the way to start a PPV.  Zingano has been through a lot and it appears that she will be the next for Ronda Rousey.

-MMA Fighting has backstage footage of Tim Kennedy confronting Yoel Romero about the extra time he took to get up from his stool in between rounds.

-Interesting that the UFC are rolling out different types of Bruce Lee t-shirts.  Hopefully some of the money that I suppose the estate is receiving from licensing his likeness is going toward this.

-Dominick Cruz won me over in just the 61 seconds of work.  First, his Jay Z/Cypress Hill remix entrance, Then, the plain black CRUZ sweatshirt.  Easily the best thing anyone has worn to the octagon in the history of this sport.  Finally, his “Alpha-Fails” drop is probably one of the best post-fight lines in a while.

-UFC on Fox YouTube channel has the whole 61 second Cruz return fight.

-Some argument as to whether Cruz fight should have been on PPV.  You can see it as perhaps a concession to boost FS1 ratings.  In hindsight, all of the fights on the PPV were great and hard to see replacing one.

-The good news is that the clay pigeons that Cerrone shot during that Embedded episode were not real as they were made at the same place that Floyd Mayweather got his fake weed from All Access.

-Not surprising, but according to Google Trends, Dublin and Ireland were the most interested city and country for search term “UFC 178”.

Conclusion

This was to be Jones-Gus II.  But after that was scrapped, it was Jones-Cormier.  After the Jones-Cormier media day brawl in August, one could have made the argument that UFC 178 would be the second-biggest PPV event of the year after UFC 175.  But with Jones getting injured, the need to adjust the lineup probably hurt the buy rate.  Overall, this card was very solid with every PPV fight being an entertaining one.  However, selling the Johnson-Cariaso was tough and you might infer that most of the pre-fight hype was for McGregor-Poirier. Although McGregor could be a breakout PPV star, he is not one yet.

While Google Trends saw an uptick in searches for UFC 178 from Ireland, it’s worth to note that the US was the 4th interested country for the event.  In the end, a buy rate of 300,000-325,000 seems reasonable.

Weidman out, Hendricks-Lawler II for UFC 181

September 22, 2014

The UFC announced this afternoon that Chris Weidman is out of his main event fight with Vitor Belfort at UFC 182 on December 6th.  In its place, the UFC has inserted Johny Hendricks-Robbie Lawler as the main event for the PPV.


Hendricks-Lawler had been rumored to be scheduled for early 2015, possibly Super Bowl weekend.  Instead of putting Gilbert Melendez-Anthony Pettis at the top of the card, the UFC decided to add the welterweight title match to the card.

With Weidman’s injury, if all goes well, we could see Weidman-Belfort on the same card as Nick Diaz-Anderson Silva at UFC 183.

Payout Perspective:

The move to insert another title fight into the mix for UFC 182 reflects two things.  The first is that the UFC wants to end 2014 on a high note with its PPVs.  Certainly so far there’s been some real underwhelming PPVs and even a cancellation.  Secondly, while no one will admit to it, there has to be a concern that the Gil-Pettis title fight may fall victim to injury.  Thus, Hendricks-Lawler serves as insurance for the PPV.  The Weidman injury is a blow to the PPV but at least the Belfort TRT issue will not be a part of the pre-fight media.  Based on the slate of fall PPVs upcoming, the UFC definitely wanted a big card to end the year and adding the rematch to what was arguably the best fight (so far) of 2014 helps.

TUF 20 re-air on Fox Sunday draws 1.735M

September 17, 2014

The Ultimate Fighter 20’s season debut which Fox re-aired on the network Sunday “adjacent” to NFL on Fox game coverage scored a composite of 1.735 million viewers.  Additional re-airs on FS1 and FS2 added 267,000 viewers for a total of 2.54 million according to a company media release.

It was the first time that Fox has aired a TUF episode on Sunday next to NFL games.  The times as to when TUF aired on Fox varied.  For example, some viewers across the country saw TUF prior to the 1pm west coast (4pm east coast) game while others saw it after the early games (10am/1pm respectively).  In Seattle, TUF did not air until 11:30pm on Sunday night.

The 1.753M number comes from the national average of viewers which Nielsen calculates using around 200+ local markets.

In addition, the Live +3 day viewership drew a significant amount more viewers (up 55%) as it added another 295,000 viewers to the initial viewership of 536,000.  Thus, the total amount of viewers that saw TUF 20’s debut (if you included those that saw it on DVR) was 831,000.

Payout Perspective:

The total viewers that have seen TUF 20 is actually 2,538,000 although the media release rounded up.  Airing TUF on Sundays piggybacking on the NFL should help with the visibility of the TUF product as the hope appears to be snagging NFL fans not flipping to the Red Zone channel after/before the games on Fox.  It’s a good more and shows that the UFC/Fox really want to push this season.

Xyience sold, ends sponsorship with UFC

September 15, 2014

Multiple beverage industry trade outlets reported last week that Xyience had been sold to Big Red, Inc. of Austin, Texas.  As a part of the transaction, the Xyience brand will no longer be an official sponsor of the UFC.

MMA Payout has confirmed the sale from two independent sources.

Xyience was established in 2004 in Las Vegas and had become one of the more visible brands within the UFC.  It also sponsored various UFC fighters, notably Ronda Rousey.

Big-Red-Logo3-300x2971XY_XSUFCXYIENCEinOnejpg

Big Red, Inc. is one of the top 10 beverage companies in North America dating back to 1937.  It will look to expand the Xyience demo by targeting other sports including Crossfit, Color Run participants and marathoners according to an interview Big Red CEO Gary Smith did with Bevnet.com.

Payout Perspective:

The acquisition is a blow for the UFC as it will seek to replace Xyience with another “official energy drink sponsor.”   We will see how the UFC will do and how soon it can find a replacement.  It is interesting to note that Big Red apparently will continue to seek out the sports demo but will not continue the sponsorship with the UFC.

Although this went under the radar, this summer it signed Matefit Herbal Tea as its “official herbal tea partner.”  The partnership is only for one year and at this point has far less brand recognition.

MMA Payout will keep you posted on this story as it continues.

The Ultimate Fighter 20 Ep 1: 536,000 viewers

September 11, 2014

MMA Payout has learned from a Nielsen source that the debut episode of The Ultimate Fighter 20: Team Pettis vs. Team Melendez scored an average viewership of 536,000 on FS1. The ratings are almost 10% down from last season’s premiere.

The first episode for adults 18-49 drew 0.4 and 0.59 for males 18-49.  In comparison, TNA’s Impact Wrestling (9:00pm-11:00pm) on Spike TV drew over 1 million viewers according to Television By Numbers.  TUF 20 aired at 10:00pm-12:00am (7:00pm-9:00pm on the west coast).

In comparing to Season 19, the season average was 476,000.  The season premiere for Season 19 drew 595,000 viewers (861,000 for Live + 3).

Payout Perspective:

New coaches, new tournament format but same ratings.  Despite all of the social media and PR buzz and even a red carpet event, TUF only mustered 536,000 viewers for its debut.  The decision to do more background on the fighters and then just one fight instead of starting the season with all fights might have hurt viewership.  But one would think that this would set up the characters for the season.  As we’ve written previously, Fox execs are viewing TUF differently with respect to its live viewership versus how it does overall on the network (i.e., reruns, DVR numbers).  But, the initial rating has to be disappointing considering the amount of hype the season was given.

Zuffa, New York file final round of briefs in summary judgment motions

September 8, 2014

Late last week, the last round of briefing in its motions for summary judgment have been filed by the parties in the Zuffa lawsuit in New York.  Both sides made its final arguments to the Court in hopes of prevailing on summary judgment. The parties filed its reply briefs which address arguments made by the opposing side which rebut the initial summary judgment motions made by the parties.

To refresh your memory, New York is seeking to dismiss Zuffa’s lawsuit in total.  It has already dismissed 6 of the 7 claims made by Zuffa in the lawsuit to legalize pro MMA in the state.  Zuffa is attempting to strike down the law with its motion.

Zuffa’s Reply Brief

Zuffa reiterates some key points in its final briefing before the Court’s review.  The emphasis is that the statute banning pro MMA (sec. 8905-a) is unconstitutionally vague (which is the remaining legal claim).

First, it notes that there are two independent reasons why a statute is vague:  1) lack of notice; and 2) the statute’s arbitrary or discriminatory enforcement.  Zuffa states that the first prong is sufficient for the court to grant summary judgment in favor of Zuffa.  In explaining its position, Zuffa states the standard that “a person of ordinary intelligence” would have reasonable opportunity to know what is prohibited.  Here, it argues that no one could know what is prohibited based on this statute.

The overarching theme for Zuffa is that the statute is so confusing that even state officials are not able to interpret it. It hammers home this point through the example of the state’s Attorney General agreeing at oral argument that an exempt organization can sanction a pro MMA event. Thus, how can the law be enforced.

In addition, it refutes an argument made by New York in its opposition brief that exempt organizations can sanction to only “single discipline” “traditional” “long recognized” martial arts.  Zuffa points out in its legal argument that New York misinterprets and/or misreads the statute in its favor.  Essentially, New York attempts to cite legislative history when one need only look to the plain meaning of the statute.  Nowhere in the statute does it preclude pro MMA from being sanctioned by an exempt organization.  Yet, Zuffa argues that New York tries to read into the statute. Zuffa also argues that the state’s enforcement has been arbitrary or discriminatory.  In this argument, it states that after discovery in the case, it became clear that state officials lacked clear guidance in enforcing the statute.  Here, Zuffa points out inconsistencies obtained through the discovery process (i.e., written interrogatories and/or depositions).

Zuffa's Reply

New York Reply Brief

New York argues for the dismissal of Zuffa’s case and in so doing it reiterates its strategy that the plaintiffs lack legal standing to bring this claim in federal court.  It also argued that due to the fact that the statute is one of state law, a state court should render the opinion here. In supporting its lack of legal standing argument, it suggests that Zuffa had a mere “oral understanding” with an exempt organization (here the World Kickboxing Association) when Zuffa argued that it had an agreement with the WKA to sanction an event in the state.  If it is found that there was an agreement, it would satisfy the legal standards of standing as there would be a recognizable injury (i.e., New York is preventing Zuffa from conducting an event through the WKA).

However, New York points out there was no written contract, details or anything else that has surfaced as evidence.  New York also notes that the declarations in support do not indicate when the agreement between Zuffa and WKA took place.  It also intimates that the claim that Zuffa and WKA had an agreement to sanction an event did not happen until after the filing of this lawsuit. It also argues that a state statute should be interpreted by a state court and that Federal jurisdiction should abstain from ruling until the state has interpreted the law.  Here, it appears that a state court has yet to generate an opinion on the statute. In addition to its briefing, there is also the motion to strike brought by New York regarding some of the evidence cited by Zuffa in its briefing.  If the court were to grant New York’s motion, a huge chunk of Zuffa’s argument would go away.

AG Reply

Payout Perspective:

It does not appear that the court has determined whether there will be an oral argument in this case.  The court, in its discretion, may review the pleadings and decide at that point whether an oral argument will help it make its decision.  Once again, Zuffa provides solid legal arguments.  The question is whether the arguments would satisfy the Summary Judgment standard which is whether there are no genuine issues of material fact, summary judgment is proper.  As for New York, it is giving the court “an out” with its arguments (lack standing, state court proper forum). MMA Payout will continue to keep you posted.

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