Parties request further clarification over discovery in UFC Antitrust case

June 21, 2017

After a June 1, 2017 conference with the Judge Peggy Leen to discuss outstanding discovery issues, the attorneys for the fighters and the UFC are at it again over what was said at the hearing.

On June 20th, Plaintiffs’ attorneys sent a letter to the Court requesting clarification on “a number of issues arising out of the Court’s order.”  The Plaintiffs sought clarification from the following:

  1. “Do Third Parties that produced documents before or just after the hearing count against the 5 document subpoenas allowed to Plaintiffs?” Plaintiffs have informed the UFC that they were intending to pursue documents from Golden Boy Promotions, Haymon, DiBella Entertainment, Inc., Top Rank, Inc. and Gary Shaw.  Plaintiffs had served documents subpoenas on 17  third parties.  The reason for the clarification is because they were to receive documents from Leon Margueles and Jakks Pacific prior to the hearing.The UFC claims that the two count as part of the maximum 5 issued by the Court.  Obviously, the Plaintiffs contend that they do not.  The UFC notes in its memo to the Court that Plaintiffs did not bring up this production to the Court.
  1. “Has the Court Authorized Plaintiffs to Depose Matt Hume?” Hume is a part of OneFC as Vice President of Operations and Competiton for the company.  According to Plaintiffs, counsel for OneFC will not accept a subpoena and since the company is headquartered in Singapore, lack jurisdiction.  The UFC did not oppose this request and takes no position.  It should be noted that both Plaintiffs and the UFC have agreed to document production from OneFC which was not counted against the 5 allowed by the Court.
  2. “Can Plaintiffs Pursue Discovery from Mercer?” The fighter pay study commissioned by the UFC’s attorneys to be done by Mercer is at issue here. Plaintiffs would like to “resume the discovery initiated in mid-2016.”  The UFC wants this counted as a third-party request.  It notes that some of the documents requested by Plaintiffs were designated as work product by the UFC in spite of the previous court ruling requiring certain documents produced by Mercer to be produced.  In addition, it is requesting clarification regarding a deposition of Mercer.  The UFC had offered to stipulate to the authenticity of documents produced by Mercer in lieu of a CR 30(b)(6) deposition.  But, according to the UFC, Plaintiffs never responded.

Payout Perspective:

The parties were ordered to meet and confer over outstanding discovery issues after the court conference but there is still conflict between the parties.  Laid out by the parties, it’s clear there might be a legitimate gripe.  It usually not a good look to be seeking clarification just after a hearing to go over discovery issues again especially when the overarching theme of the process is for the parties to cooperate.  These types of outstanding issues (i.e., what counts as 5 third-parties, etc.) must be discussed by the parties in Court in front of the judge.  There are some issues that you might not be able to think of while standing in court, but that’s why there are usually more than one (likely three or four) attorneys at the hearing so they can pass along notes to lead counsel to come up with questions to clarify.  Likely, Judge Leen will hold a teleconference but will none too pleased that the parties are coming back.

Plaintiffs Memo Re Discovery by JASONCRUZ206 on Scribd

Defendants Memo Re Discovery by JASONCRUZ206 on Scribd

Nate Diaz, Leslie Smith sued by former agency

June 21, 2017

TMZ Sports first reported that Nate Diaz and Leslie Smith are being sued by their former management group for nonpayment of commissions and conspiring with an attorney to break management agreements.

The lawsuit claims that the defendants owe them more than $1 million in damages and that they were never paid for their work on the UFC 202 fight with Conor McGregor.

Sam Awad is also named as a defendant in the lawsuit.  Awad represented Diaz this past April at a NSAC Commission hearing which reduced his fine and suspension from his UFC 202 press conference.

The lawsuit, obtained by TMZ and MMA Junkie note that Ballengee signed Diaz as a client in the summer of 2014 on recommendation from his brother Nick who was an existing client.  The lawsuit alleges that Diaz would pay based upon the same terms as Nick’s contract with the company.

If the Ballengee Group name sounds familiar, Jeff Borris is a member, he is the individual heading up the Professional Fighters Association.  Smith had a falling out with Borris after initial support for the organization.

The Ballengee Group was launched in 2014 by oil company entrepreneur James Ballangee.  He hired baseball agents and attorneys away from CSE, Perennial Sports & Entertainment and MVP Sports Group.

Payout Perspective:

This will be an interesting lawsuit to follow as we may see the inner-workings of the commission structure for Diaz and maybe Smith.  It always amazes me that a lot of the fighter-agent relationships are dependent on the fighter paying the agent after-the-fact instead of the payment going into some sort of trust account from which the agent can take its payment and leave the rest to the fighter.  The inclusion of Awad likely means that the fighters will defer to him as the reasons for nonpayment.

Update on Hunt lawsuit: parties stipulate to extend time for filing of response to First Amended Complaint

June 19, 2017

The parties in the Mark Hunt v. UFC/White/Lesnar case have stipulated to allow the defendants an extension to file a responsive pleading to Hunt’s First Amended Complaint.

Hunt filed the First Amended Complaint on June 1, 2017.  According to the Federal Rules of Civil Procedure, a party has 20 days from the filing of the complaint to respond.  The stipulation extends the response date to June 26, 2017.

Stipulation and Order Extending Time to Answer First Amended Complaint by JASONCRUZ206 on Scribd

Payout Perspective:

This is not huge news but gives defendants and extra weekend to file an Answer, Counterclaims or another Motion to Dismiss.  Since it gives defendants an extra weekend to prepare a response, I would suppose a Motion to Dismiss might be filed once again, or at least a motion to dismiss the RICO claims.  We will see.

Show Money Episode 17 addresses Mayweather-McGregor fight

June 16, 2017

Show Money Episode 17 is back for the second time this week talking Mayweather-McGregor.  I join John and Paul to discuss the Mayweather-McGregor announcement.

Show Money Episode 16 talks DJ controversy

June 15, 2017

Show Money is back. In episode 16, we talk strictly about “company man” Demetrious Johnson’s outburst last week and Dana White’s response.  As always, Paul Gift and John Nash of Bloody Elbow provided the key insight.

The show was taped on Tuesday prior to the Mayweather-McGregor announcement otherwise we would have talked about the event on August 26th.

Report: Mayweather-McGregor set for August 26th at T-Mobile

June 14, 2017

Kevin Iole reports that the long-awaited fight between Floyd Mayweather and Conor McGregor is set to happen on August 26th at the T-Mobile Arena MGM Grand Garden Arena T-Mobile Arena in Las Vegas.  The Las Vegas Review Journal has also confirmed the fight.  An official announcement may come as soon as Wednesday.

SECOND UPDATE:  Sorry folks, I was right the first time, it’s the T-Mobile Arena.  Possibly a Mayweather concession since the UFC is one of T-Mobile Arena’s anchor tenants while Mayweather usually fights at the MGM Grand.  TMZ has more of the details including both Mayweather and McGregor likely making over $100M each.  No news on what weight they have agreed upon.

UPDATED:  I guess it is official via Mayweather social media.  Note the “It’s Showtime” reference which means that Mayweather gets his way with the PPV provider.

The Nevada State Athletic Commission approved a date reserved by Mayweather Promotions for Saturday, August 26, 2017.  The news had Mayweather cancelling the commission review of the date, but that never happened as the commission approved the reservation Wednesday.

With that news, in all likelihood we now have a fight between Mayweather and McGregor.

Payout Perspective:

We will have more news on this as it comes.  But, I am impressed that the sides came to an agreement.  Recall, the prolonged negotiations for Mayweather-Pacquiao.  This happened sort of quickly.  No word on how much PPV will be but expect it to be $100 as both will likely be making over $100 million from the fight.

MMA journalists announce formation of MMAJA

June 14, 2017

A collection of MMA journalists has formed an association calling themselves the “MMAJA” as first reported by SI.  The officers for the MMAJA include writers from MMA Junkie, MMA Fighting, Bleacher Report and The Guardian.

The Board of Directors is comprised of Dann Stupp, Ariel Helwani, Chad Dundas, Marc Raimondi, Ben Fowlkes and Josh Gross.  The goal of the association is to promote a high standard of ethics and professionalism and help navigate working relationships with promoters, fighters and others in the MMA industry.

According to SI article, the thought of an association came out of the UFC 199 incident which Ariel Helwani and two others were ejected by the UFC from the event after a report made by Helwani.

Of course, the other side of the story is that Helwani was being paid by the UFC to cover the company.

According to the web site, MMA journalists are encouraged to join.  There is a fee to join for a one year membership.

Payout Perspective:

This is a good idea as there are these types of associations in other sports like football and baseball.  While it is unknown how much true power the association will yield, collectively coming together and establishing standards is a step toward more of a professional appearance similar to that of other sports.  For the cynic, it does appear that writers from big media companies (Vox, Bleacher, Guardian) control the board but this could change as these are the people that started the association.  It will be interesting to see who will join and how promotions deal with an association.  Certainly, MMA media and bloggers that cover the sport have been a scapegoat when it comes to reporting.

Judge orders UFC hand over fighter pay documents

June 12, 2017

U.S. Magistrate Judge Peggy Leen issued a 26-page ruling on Friday in the UFC Antitrust lawsuit which requires the UFC to hand over a study related to fighter pay.  There were three document requests demanded by Plaintiffs which included information related to a fighter pay study.

Order on Motion to Seal by JASONCRUZ206 on Scribd


Mercer is a third party human resources consultant.  The primary dispute is over a study commissioned by Mercer to produce a “fighter pay assessment” to guide “future compensation and benefits program design, including fighter pay (base and incentives) and benefit levels.”

The UFC produced 6 documents to requests by Plaintiffs and there are 3 documents in dispute.  Two were created by Mercer and the third was an email chain between the UFC’s in-house counsel and its outside lawyers Campbell & Williams regarding setting up a phone call with “outside consultants.”

After the documents were received by Plaintiffs, a subpoena and deposition notice to Mercer regarding the fighter pay study.  At that time, the UFC notified Plaintiffs are “clawing back” the three documents in dispute citing work product.  Clawing back is a request made of the inadvertent waiver of alleged privileged documents.  The claw back is usually dictated by the protected order the parties agree to at the start of litigation.

Of the three documents in dispute, the first is a memo from a Mercer employee regarding statement of work for the fighter pay study, the second is the aforementioned email chain between the UFC’s lawyer and Campbell & Williams and the third is a draft presentation entitled, “Fighter Pay/Project Update and Methodology Discussion dated March 18, 2014.

As the judge’s order notes:

“The presentation discusses a comparator group of other sports organizations including NASCAR, MLB, the NBA, and the NHL whose compensation practices Mercer proposed to study to “provide an external basis for understanding how UFC’s fighter pay structure and practices compares to similar companies.”

All three documents claimed that the information was work product.

The key term to understand when determining work product is whether the documents were created in “anticipation of litigation.”  The Court determined that they were not.

Notably, the UFC argued that a previous “quite contentious” interaction with Bellator as reasons why the current information was work product.  They cited the Eddie Alvarez lawsuit which produced a contract that has been used time and again.

The Court did not buy the UFC’s argument that the documents were work product.

Under the Court Order, the UFC must produce the documents.  The Court did not intervene on another issue regarding privilege log designations from UFC – a list of documents that a party must produce to show the opposing side what it is withholding and what privilege it is claiming to withhold.  The Court wants the parties to conduct a meaningful “meet and confer” prior to judicial intervention.

Payout Perspective:

This is a loss for the UFC as it wanted the documents to be privileged.  With the documents in Plaintiffs hands, they will likely conduct a deposition of the Mercer employee(s) that produced the study as well as use the information in deposing UFC officials.  Will this facilitate any settlement?  Probably not, but the information may reveal information for the overall theme of the case for the Plaintiffs.

Finding the flow with Rener Gracie

June 9, 2017

Rener Gracie visited the Pacific Northwest for the first time in over three years as he conducted an all-day Seminar on Sunday, June 4th in Seattle and then another smaller seminar at the Gracie Academy in Issaquah, WA on Tuesday, June 6th.  For the Brazilian Jiu Jitsu practitioner, Rener’s seminars are amazing and an introduction to the philosophy and mind of one of the best in the world.

The Gracie name is royalty in the realm of the martial art of jiu jitsu.  Grandmaster Helio Gracie, along with his brother, Carlos Gracie, founded the martial art of Gracie Jiu-Jitsu.  Jujutsu was a Japanese martial art and a method of close combat for defeating an armed and armored opponent in which one uses no weapon or just a short weapon.  It was introduced to the Gracie family in Brazil around 1914 by Esai Maeda.  According to the family history, Gastao Gracie befriended Maeda and taught his oldest son, Carlos Gracie the art of jujutsu, which became jiu-jitsu.  Helio learned soon thereafter and due to his frail physique, he modified the techniques to accommodate his strength and used leverage and timing.  As a result, Gracie Jiu-Jitsu was born.

The 33-year-old Rener is the grandson of Helio and carries on Gracie Jiu Jitsu along with his brother Ryron oversee the Gracie Academy in Torrance, California.  There are over 100 Gracie Certified Training Centers on 6 continents around the world.  As vast as the Gracie reach, Rener conducts seminars across the globe and followers flock to them to experience Gracie Jiu-Jitsu in person.

Rener Gracie

This sunny Sunday in Seattle (technically Burien), people flew in from various states and drove from Vancouver, B.C. and Vancouver, Washington to learn from Rener.   In fact, Rener acknowledged that one of his students from Torrance flew up from California to attend.  The reason, as his student explained to Rener, was that the seminars provide vast details that are can rarely be covered in a 1 hour class.  A huge percentage of those in attendance were serious about this seminar as well as many took copious notes and filmed themselves doing the techniques so that they would not forget.

The seminar was set up by Craig Hanaumi, a Bellevue Police Officer and Purple Belt under Rener.  It took place at the Washington State Criminal Justice Training Commission.  There was a lot of mat space as it was the gymnasium where officers train.

Rener is a tall, unassuming young man that is very passionate about teaching and the art of Gracie Jiu-Jitsu.  While jiu jitsu is taught by many schools and academies in many different ways it’s easy to understand the appeal of the Gracie philosophy. Rener mixes traditional teachings with a mix of new school terminology which you can suspect is from his southern California roots.  He mixes in a “dope” and encouraging “come on bro” every now and then when walking around the mat inspecting moves.  One of the techniques he dubbed was, “Weak Side For Life” which is a reminder to the practitioner which way to go when taking someone’s back.  He not only teaches white and blue belts with mastering moves but also helped out brown and black belts tweak their techniques.  Rener would provide subtle advice to the black belt that he would demonstrate moves with to perfect the technique for those watching and the black belt he was working with.

Rener emphasized that “mindset” was the greatest contribution that his grandfather provided to the art of jiu jitsu.  He deconstructed the mindset of most of the participants in the room when he explored different positions and identified areas of strength in positions where the perception is an area of weakness.

Instead of giving maximum effort in the practice of jiu jistu Rener preached muscle conservation.  Assuming that you will practice jiu jitsu the rest of your life, Rener suggests this preserves longevity.  He’s seen burnout among fighters and BJJ practitioner’s due to the fact they expend all of their energy when they were young.  “By the time that you’re 50, you will feel like you aren’t who you were supposed to be and you should quit.”

“Start dedicating 10-20% of your time today to rolling like you are 70-year-old black belt,” Rener advised those in attendance in order to continue practicing into your golden years.  Despite the perception that this is absurd, it falls in line with the philosophy and mindset.  Going through the day-long seminar and learning the techniques, you realize that with repetition and practice, the Gracie Jiu Jitsu philosophy is an effective way to practice the martial art.

The all-day seminar was broken down into 4 2-hour sessions.  Many people stayed the whole day while others that could not make the over 8-hour time commitment took in as many sessions as they could.

There were 8 “slices” to each two-hour session in which Rener discussed a move that he would go over and then the participants broke off to attempt the maneuver with Rener going around and helping out.  He embraced all types of questions.  He explained that there were no questions about the technique that were out of line as it was his responsibility to teach and the questions helped him dissect what he needed to focus on with the individual to facilitate the learning.

The first two sessions encompassed escaping from side mount and passing the guard.  These two sessions were a good primer for those starting in jiu jitsu as many will find themselves here.  The sessions helped with answering the basic question of how do you get someone off of you?

“You don’t want to be one step away from misery,” Rener explained about dealing with an opponent that is on top of you in side mount.  He added, “[y]ou want to be at least two.”

Rener provided the thesis statement that the person in control in side mount is the person on the bottom as opposed to the one on top.  The reason, explained Rener, was that it is on the person on top to make an affirmative move to improve their position whereas the person on the bottom has the ability to counter the movement.

The philosophy is contrary to jiu jitsu competitions due to the time constraints where points are essential in a matchup to win.  Rather than a competitive mindset and the use of force and incessant pressure to force oneself out of a bad position, Rener preached to focus on making the best out of the position.

Water was used throughout the day as analogy for how to flow in jiu jitsu.  “He chooses where to put the rocks, the water always finds the way,” explained Rener about the flow in jiu jitsu.  It explains the fluidity of the art and the ability to think and move when presented with an obstacle.  The art is supposed to provide advantages for the smaller and less strong practitioner.  Flowing like water is an acknowledgment that there will be strong opposition, but like water, it continues to come forward finding ways to pass.

After a lunch break, the last two afternoon sessions were dedicated to more offensive maneuvers with mastering the triangle and “triple threat” mastery which involves getting the back of an opponent.

Again, the two afternoon sessions provided different ways of approaching standard issues in jiu jitsu.  The first afternoon session looked at positioning your opponent so you can submit them with a triangle choke.  The second afternoon session evaluated the methods of submitting someone when having their back.  Each technique during the afternoon session included Rener’s emphasis on the setup as much as the finish.

Throughout the day, Rener’s energy never wavered.  Like a scientist, he analyzed, dissected and deconstructed every move and made it easy to follow while patiently answering questions.  I was impressed at how he was able to articulate the moves and provide finite detail as if the human limbs were a jigsaw puzzle.

Jiu Jitsu is an acquired taste.  Many have a love/hate relationship with the martial art as it is difficult to start, tough to master, takes a long time to get promoted in rank, but easy to quit.  Yet, there are so many devotees to the sport.  I met several individuals who only picked up the sport within 3 months and were already interested enough to sacrifice a weekend day to learn at a seminar.

Overall, it was a productive Sunday to learn more about jiu jitsu and the philosophy of Rener Gracie.  There was an overload of information but no one seemed to complain.  For those dedicated to their own journey in the martial art, it was a valuable experience.

UFC 212: Payout Perspective

June 6, 2017

Welcome to another edition of Payout Perspective.  In this edition, we take a look at UC 212 from Rio de Janeiro, Brazil where the Featherweight title was unified.

Holloway scores TKO over Aldo

Max Holloway scored an impressive stoppage of Jose Aldo to unify the UFC Featherweight Title (technically Aldo held the title and Holloway won the interim belt in December).  Holloway stopped Aldo in the third round.  It was an impressive showing of Holloway’s talent and his “no fear” attitude in going to Brazil, embracing his surroundings and winning.

Holloway is probably hoping Conor McGregor returns to division for a rematch of their first fight which took place the first day of FS1 in August 2013.  It was Holloway’s last loss in the UFC.  If that doesn’t happen a showdown with Frankie Edgar or perhaps Cub Swanson should happen.  My only bias, but I’d like to see that fight happen with the UFC going to Hawaii.  The logistics and expense would be tough but it would be a great visual to see the fans go crazy for the first Hawaiian fighter to win a UFC title since B.J. Penn.

The UFC covered the homecoming for Holloway which was a great visual and a sign that the company will get behind the new Featherweight king.

By Source, Fair use, https://en.wikipedia.org/w/index.php?curid=53169658

Claudia Gadelha submits Karolina Kowalkiewicz

Gadelha looked impressive in submitting Kowalkiewicz.  The problem for the UFC is whether they can really have her face Joanna Jedrzejcyk for a third time when she lost the first two.  Perhaps they go with Rose Namajunas against Joanna before Gadelha gets another shot.

It was a disappointing performance for Kowalkiewicz as she previously had a good showing against Joanna.

Attendance and Bonuses

The event took place at Jeunesse Arena in Rio de Janeiro, Brazil and drew 15, 412 as reported by the UFC.  The attendance likely means it was a sellout as the capacity is set at over 14,000.  UFC 134 was held in the same arena and drew 14,000.

The bonuses went to Max Holloway, Jose Aldo, Claudia Gadelha and Brian Kelleher.  Holloway-Aldo drew Fight of the Night and Gadelha and Kelleher drew Performance of the Night.  One could argue that Yancy Medeiros, Paulo Borrachinha or Matthew Lopez could have drawn a $50,000 bonus for their performances.  Also, Medeiros-Erick Silva could have been a FOTN candidate.

Sponsors

Budweiser was a prominent sponsor in Brazil as it had the center of the Octagon as well as the fighter prep point and the Embedded episodes.  Kingdom on Audience, UFC Mobile game, UFCStore.com, Hudson Shipping Company, Nissan, General Tires, Manguinhos, a previous UFC sponsor, was on the mat on Saturday.

The Nissan and General Tire sponsors are probably ‘one-offs’ for the Brazil event.

No Monster Energy in the Octagon.  Recall that TNT Energy Drink had the Brazil market at one point as the UFC sponsor.  Aldo was a big sponsor but it looks like that is no longer true.

Odds and Ends

Here is the local coverage in Hawaii for Max Holloway and Yancy Medeiros.  The report states that a lot of the UH Football team showed up to see him.

Hawaii News Now – KGMB and KHNL

The UFC Prelims were late on FS1 as baseball ran over into the time slot.  The event had to be put on FS2.  This may have had an affect on the ratings as it drew 732,000 viewers on FS1 for the bulk of the telecast.  The beginning part, shown on FS2, drew 218,000 viewers.

The Brazilian Commission did not adopt the new unified rules of MMA.  Fortunately, the rules did not come into play.

The UFC 214 promo came out and they look pretty good.

It was interesting that there was promotion for the UFC Fight Night Singapore event two weeks from now but not this week’s Fight Night from New Zealand.

The first Japanese UFC Champion, Sakuraba, will go into the UFC Hall of Fame.  The announcement was made during the PPV.

The “UFC Unfiltered” Podcast ran commercials throughout the PPV Prelims on FS1.

UFC 212 drew 200,000 google searches on Saturday.

Conclusion

200,000 google searches the day of the event, the MLB overrun on FS1 for the Prelims and the fight card in Brazil probably means that this PPV draws somewhere between 150K to 200K PPV buys.  In comparison, UFC 134 (ASilva-Okami) drew 335,000 buys in the same venue in September 2011.  Aldo-Mendes 2 in Maracanazinho, Brazil drew 180,000 buys.  The event took place in October 2014 at UFC 179.  Holloway’s last PPV in December against Anthony Pettis drew 150,000 PPV buys although a replay on Fox during Christmas Eve did well.  Still, we’re talking about buys for PPV and with a string of UFC events coming up for June and July’s International Fight Week coming up this PPV may have been one that the casual fan skips.

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