August 11, 2014
Andre Ward has filed a lawsuit in U.S. District Court of the Northern District of California against his promoter, Goossen Tutor Promotions and Dan Goosen. The lawsuit is premised upon the Muhammad Ali Act.
The lawsuit, filed on August 4th cites violations made by Dan Goossen which violate the federal law which was put in place to protect boxers from exploitation inside and outside of the ring. Namely, Ward accuses Goossen of not providing him with the proper payout information prior to an event which is required pursuant to the Ali Act.
The Complaint (found here) states that “Since the inception of Goosen’s tenure as Mr. Ward’s promoter in 2004, and continuing to the present, Goossen has repeatedly and systematically violated all disclosure requirements under the Ali Act by failing to timely provide Mr. Ward with full and complete disclosures.” The Complaint cites several specific fights where Goossen did not provide Ward the necessary payout information which would have included: 1) the amounts of any compensation or consideration that a promoter has contracted to receive from such match; 2) all fees, charges, and expenses that will be assessed by or through the promoter on the boxer pertaining to the event, including any portion of the boxer’s purse that the promoter will receive, and training expenses; 3) and any reduction in a boxer’s purse contrary to a previous agreement between the promoter and the boxer or a purse bid held for the event. (per Ali Act 15 U.S.C. sec 6307(c).
It was not until the spring of 2013 that Ward’s manager demanded the information from Goossen. According to the Complaint, Goossen failed to comply and when he did provide information it was “woefully inadequate.”
The Complaint requests that Goossen “provide a full accounting of all revenues and expenses related to any boxing matches in which Mr. Ward participated and Goossen served as promoter including, but not limited to, barter arrangements, multi-bout television and venue agreements, or any other boxing events originating from the relationship with Mr. Ward.”
Notably, the parties have gone to Arbitration in California this past spring with Goossen prevailing. However, Ward did not even show up to the Arbitration as it was his counsel’s contention that the Arbitration was not valid. The California State Athletic Commission ruled that the Arbitration this spring was valid since there was no previous objection. As far as the substantive issue at Arbitration goes, the parties disputed the duration of the promotional agreement. Due to a shoulder injury which sidelined Ward for a year, the question was whether the promotional agreement should be extended due to the injury to Ward. CSAC held that Ward was uncooperative when he returned from injury in seeking out a fight and thus the agreement’s original expiration was extended 14 months.
The lawsuit is just the latest in the ongoing saga with Andre Ward and his promoter. For what it is supposed to be, the Muhammad Ali Act has not had many boxers use it and prevail. We will see based on the information that will undoubtedly surface in the discovery process. It will be interesting what explanation is given by Goossen as it relates to the purported failure to provide Ward with payout information. Then again, the question of why it took so long for Ward to report this violation is something that will likely come up too.
MMA Payout will keep you posted.
August 4, 2014
The parties in the lawsuit involving promoter Main Events and Adonis Stevenson, Al Haymon, Golden Boy, Showtime and Stevenson’s manager have been dismissed per a letter sent to the Court on Saturday morning.
As we reported, the lawsuit filed this past May was based on alleged agreement for Main Events and their fighter Sergey Kovalev to face Adonis Stevenson what was anticipated as a big money fight on HBO. However, Stevenson signed on with consultant Al Haymon and took a fight under the Golden Boy banner. After the schism within Golden Boy, it was believed that the fighter left with Haymon.
A lawsuit was filed by Main Events claiming breach of contract, breach of fiduciary duty, fraud, tortious interference and interference with prospective economic advantage premised upon emails between Main Events and Stevenson’s manager. Main Events claimed that the emails constituted a contract while the defendants claimed that the emails were not a contract as other details needed to be hashed out before a contract could be signed.
As one might expect, the defendants filed a Motion to Dismiss based on their theory that the emails did not constitute a contract. The court allowed Main Events to Amend its Complaint on August 4th but decided to settle the case.
In a letter which looks to be sent on Saturday morning, August 2nd, counsel for Main Events let the court know of a settlement and sought a cursory request to extend the deadline to file an Amended Complaint in the event the settlement fell through.
As a result of the settlement, Kovalev faces Bernard Hopkins this fall which will be co-promoted by Golden Boy and Main Events.
It appears that all is well that ends well. It’s clear that Kovalev’s promoters, Main Events, wanted to be made whole based upon the feeling of being left with nothing after Stevenson signed with Al Haymon. The Hopkins fight is a good substitute for Stevenson. Moreover, the legal claims made by Main Events were tenuous especially with the theory of a contract based upon emails. Instead of spending money on legal bills, the parties were able to negotiate an alternative.
August 2, 2014
The state of New York and Zuffa filed Motions for Summary Judgment in the ongoing lawsuit which seemingly has no end. The filings, which were filed Thursday of last week, each hope to bring a resolution to the lawsuit filed by Zuffa in November 2011.
As most know that have been following this legal fight, Zuffa and other named plaintiffs filed a lawsuit against the Attorney General of New York in an effort to strike down the existing legislative ban on professional MMA in the state. The Court dismissed most of Zuffa’s claims including a legal claim suggesting it infringed against its First Amendment rights.
The remaining claims before the Court are whether the statute is unconstitutionally vague and the state liquor law which allows for liquor to be sold at events. Both parties have requested the Court to rule in its favor on the remaining claims.
For New York, it is requesting the Court to dismiss the challenges made by Zuffa. If granted, the case would effectively be over pending an appeal to the Circuit Court.
For Zuffa, it is requesting the Court to strike down the law banning professional MMA in the state. This would effectively allow for professional MMA in the state since the law would no longer exist. Of course, we’ll speculate on this later.
The standard for a Court to grant a Summary Judgment has the party filing the motion having to prove that there is “no genuine dispute as to any material fact” and that the person bringing the motion “is entitled to judgment as a matter of law.” Basically, the Court must find that based on the facts presented, there is no reason to hear anything else about the dispute because the facts show there is no dispute. This certainly can be a tough threshold for any party bringing a motion.
New York’s Summary Judgment Motion
New York strategically argues that most of the named Plaintiffs must be dismissed because they have no standing. Essentially, they cannot bring the lawsuit because there is no injury (i.e., damages). In this scenario, if there are no damages, there is no standing to bring the claim. Plaintiffs cannot bring a claim on hypothetical damages, rather the damages must be “actual and imminent.” New York argues that most of the named Plaintiffs including Jon Jones, Gina Carano, Frankie Edgar, Matt Hammill and Brian Stann do not have the requisite standing because each have not suffered an actual injury and thus have no damage claim. The parties had agreed that Jones, et al would not be deposed if they would not provide any evidence of the vagueness allegation. Thus, New York now brings the motion to dismiss them.
It argues that the “only still surviving Exempt Organization,” the World Kickboxing Association (WKA) has only a “tentative” relationship with Zuffa. It also points out that Zuffa and WKA have no formal agreement to run an event or future plans to do so. Thus, Zuffa cannot claim injury.
Arguing that the Plaintiffs have no standing means the Court does not need to rule on the substantive legal issue-whether § 8905-a, the law banning professional MMA (or the New York “Liquor Law” which prohibits licensees who serve alcohol for on-premises consumption) is unconstitutionally vague.
While this may be cynical, arguing the procedural issues rather than the substantive content allows the Court an “out.” Courts would not have to decide on the constitutionality of a law if the procedures to address the actual issue are not met. Rather, Courts could allow the legislative branch the chance to address the law. And, as we know Zuffa has been trying to do this for a while with no success.
If you are looking for a recent case that reflects a Court ruling on procedural grounds rather than substantive, look at the U.S. Supreme Court case which ruled on California’s Proposition 8. In that case, the Supreme Court did not rule on the legal issues as it determined that the private parties that brought the lawsuit had no “standing” to bring the lawsuit because they had no injury.
Here, New York argues that the Plaintiffs have no “standing” to bring the lawsuit because they lack the requisite “injury.”
Zuffa’s Summary Judgment
Zuffa filed its Summary Judgment motion seeking that the Court determine that Section 8905-a and the New York Liquor Law is unconstitutionally vague as to professional MMA. It cites the uncertainty of state officials as to the application and interpretation of the law. It notes oral argument in which the Attorney General for New York admitting that professional MMA could be sanctioned by an Exempt Organization under the law. The AG later explained away his statement. Zuffa also argues that the law is vague and it encourages arbitrary and discriminatory enforcement.
Zuffa’s moving papers hammer away that the law banning professional MMA has many interpretations and these multiple interpretations even trip up those that enforce the rules.
The following summary is just a cursory look at the papers and does not even delve into the deposition excerpts and exhibits. At this point, we’ll wait on the opposition briefs which should include more declarations and deposition transcript excerpts. And then there will be more in the reply to the opposition briefs. The final pleadings for the motion will not be filed until early September. Based on the amount of paper to read, one might not expect a decision until December, or early 2015.
But let’s assume New York wins and the case is dismissed. Zuffa will have to consider its options which may include an appeal to the Circuit Court on the decision. It would cost more money and take much longer and unless there is movement in Albany, no MMA in New York.
But what if the Court sides with Zuffa and grants its motion for summary judgment? This would mean that the law banning MMA will be determined unconstitutional and essentially strike down the law. One might expect a stay and/or the state of New York filing a preliminary injunction to stay the ruling in an effort to appeal the ruling. The effect of an injunction would be a way to prevent pro MMA in the state before an appeal to the ruling is heard by another Court. The last time most of us heard about a preliminary injunction was in the Eddie Alvarez case. In the meantime, legislators in New York that are anti-pro MMA could draft new legislation which would clarify the vagueness issue and have it ready for Albany in 2015. We could be completely off on this scenario and we haven’t even seen opposition briefs but I thought I’d throw this theory out there.
MMA Payout will have more on these motions in the coming days.
July 31, 2014
On Tuesday this week, a Minnesota jury found in favor of former governor and professional wrestler Jesse Ventura in a defamation case against the estate of a former Navy SEAL that wrote in his best-selling book about a fight with Ventura. The jury awarded Ventura $1.8 million.
Ventura won $500,000 for his defamation claim as he denied getting into a fight with Chris Kyle, a former member of the Navy SEALs and elite sniper. He also won $1.3 million for unjust enrichment.
Essentially, the book, “American Sniper: The Autobiography of the Most Lethal Sniper in U.S. Military History,” written by Kyle included a part wherein he talked about an encounter at a bar in Coronado, California where a “celebrity SEAL” was talking a little too much. In the book, he was referred to as “Scruff Face.” Kyle stated that he punched him. It came out in media interviews promoting the book that the “celebrity SEAL” was Ventura.
Ventura sued in 2012 and continued the suit against the estate of Kyle after Kyle died in a shooting at a Texas firing range. He claimed that the book caused him to lose earnings and alienated him from the SEAL community
Source: NY Times
As a public figure, the standard for proving defamation is higher than that of a private person. Ventura is considered as a public figure for a variety of reasons including formerly holding public office, performing as a wrestler and hosting a variety of television shows.
In honor of those that have taken the bar this week, here are the factors for defamation:
- There must be a statement that has been published;
- The statement is false; and
- The false statement must cause injury.
For a public figure, like Ventura, to win a defamation claim, he must prove that the writer had knowledge that the information was false.
There’s no indication that the estate of Kyle will appeal the ruling. It appears that insurance paid the defense for Kyle’s estate and presumably will pay the verdict. Ventura states that the jury award will essentially pay off the lawyers. The jury deliberated several days after closing arguments which some suspected that Ventura had proved his case and it was a matter of how much he would receive. It would be interesting to know the evidence which showed that the incident retold in the book was false.
July 25, 2014
Al Haymon and the rest of the defendants sued by promoter Main Events for allegedly breaching a contract for a fight between Adonis Stevenson and Sergey Kovalev have filed motions to dismiss the lawsuit. However, the Court has allowed Main Events to amend its Complaint which may render the motions moot.
Haymon, Showtime Networks, Inc. and Adonis Stevenson filed a motion requesting an oral argument be heard in the motion to dismiss the Complaint. In general, in federal court, most preliminary motions are decided on the moving papers unless oral argument is requested. Even then, the Court may deny a request. In addition, Richard Schaefer filed a motion to dismiss as well under the theory of respondent superior.
Essentially, Haymon et al. argue that there was no valid contract and as a result the Complaint filed against them should be dismissed. Since there is no contract, the allegations of tortious interference with a contract and interference with economic prospective advantage must be dismissed. Additionally, defendants claim that it lacked the requisite malice and intent needed for these claims.
The overarching issue is the lack of contract agreement. The defendants cite an email which preceded the purported email agreement between Stevenson’s promoter and Main Events. The email indicates that there was an agreement to agree on terms but details needed to be hashed over by attorneys at a later date. According to the defendants’ brief, in New Jersey, an “agreement to agree” upon material terms at a future time is an unenforceable indefinite promise.
Golden Boy also filed a motion to dismiss the tortious interference with contract and interference with prospective economic advantage claims as well. Golden Boy joined the motion of the other defendants but argued in addition that it was not responsible for Schaefer’s conduct on the basis of respondeat superior as the allegations occurred after Schaefer’s resignation. Basically, Golden Boy attempts to absolve itself from any conduct Schaefer may have done while as CEO as it pertains to dealings in the Stevenson-Kovalev deal.
While these Motions to Dismiss were filed, the Court allowed Main Events to submit an Amended Complaint no later than August 4, 2014 (which would make it the Second Amended Complaint). Discovery is stayed (halted) until further action from the Court
As predicted, defendants have filed a Motion to Dismiss citing no formal contract. While emails between parties may be considered a binding contract, defendants make the argument that the terms were not definite and were only an “agreement to agree.” However, the news that Main Events may amend its Complaint may mean it will provide further definitive information on its claim. MMA Payout will keep you posted on the lawsuit.
July 8, 2014
The Zuffa-New York lawsuit will have to wait a little longer for resolution as the Court has granted an extension of time request by New York to file its Summary Judgment motion. The new deadline is for July 31st with the last responsive briefing not due until September 4, 2014.
In a letter to the Court on June 25, 2014, the New York Attorney General requested an extension of time as one of its lead attorneys on the case was leaving the office on July 3rd. In addition, New York indicated that key non-party witnesses were out of the office and could not be contacted. It appears that these witnesses would provide declarations that would support New York’s Motion for Summary Judgment which, if the Court granted, would effectively end the lawsuit. New York also argues that Zuffa’s Complaint is long and two weeks to respond to Zuffa’s Response to its moving papers would not be enough time. Zuffa opposed the extension as you can see the letter to the Court here.
The Court granted the Motion which allows the filing of the motions to occur on July 31st instead of the original July 3rd Court order. Response to the Summary Judgment will be August 21st and New York’s Reply briefing would be due on September 4th.
It always makes me laugh when I read that attorneys need more time to respond to things that they want. Yes, it’s cynical but New York wants to file a motion, and now tells the Court that it doesn’t have sufficient time to do it per the parameters the Court set. Also, here’s a bunch of other excuses which include the revelation that Zuffa’s lawsuit is quite long. They should have known this, right? I have been in situations where the Court just said, “Tough.” And, you have to stay up a little later to do things and make do. With that out of my system, the Court allowing the extension is probably fair considering it’s the first one that they requested. Both parties get an extra week to fashion responses to the motions.
As far as when these motions will be decided and if there will be a resolution to this case. Maybe next summer? At the earliest we probably would get a ruling by the end of the year or early 2015.
June 30, 2014
MMA Payout has obtained a copy of the lawsuit filed by promoters Main Events as it is suing the promoter for Adonis Stevenson for bowing out of an intended fight with Sergey Kovalev. The lawsuit centers around the involvement of boxing insider Al Haymon. It was filed last month with little occurring in the lawsuit so far.
The lawsuit was filed last month and has not seen much movement in the initial filing at this point. The plaintiff is New Jersey Sports Productions, Inc. which does business as Main Events. The promotion is owned by Kathy Duva. As MMA fans may recall, Duva filed a Declaration in Support of Bellator in the Eddie Alvarez lawsuit.
The defendants include Yvon Michel, his promotion, GYM; Golden Boy Promotions; Showtime Network, Inc. and boxer Adonis Stevenson.
To set the stage, Main Events’ Kathy Duva claims that it had an agreement for her fighter, Sergey Kovalev to face Yvon Michel’s promoted fighter Adonis Stevenson. The deal was allegedly sealed with emails in late January 2014 between Duva and Michel. The deal included a co-promoted fight on HBO which carried a $2.4 million rights fee. The fee was offered by HBO executive Peter Nelson which Main Events contends was accepted by Michel on behalf of his fighter.
However, Main Events learned that Al Haymon became involved and Main Events’ attorney sent a letter to Haymon confirming the Stevenson-Kovalev. Presumably, the letter was to prevent an anticipated breach on the part of Stevenson.
The Complaint paints Haymon as an individual with “a relationship with Showtime wherein certain promoters rely…for allocation of television dates and rights fees rather than negotiating those dates and fees directly with Showtime.” It also alleges that Haymon has an alliance with Richard Schaefer (then CEO of Golden Boy) and they had planned to “wrest control” of Golden Boy. As we know now, Schaefer and others have left Golden Boy and it’s not clear whether Schaefer and Haymon are entering into a venture together. The Complaint alleges that Haymon violates the Muhammad Ali Act as he acts as a manager or advisor to boxers despite not following the rules related to the Ali Act.
Main Events claims that Showtime interfered with the negotiations between HBO and the Kovalev/Stevenson fight despite Haymon pushing for a Stevenson-Bernard Hopkins fight with Showtime.
The legal claims:
Breach of Contract
Main Events claims that Stevenson’s management group, GYM, breached its contract to co-promote a bout between Stevenson and Kovalev.
Breach of Fiduciary Duty
Main Events claims that GYM breached a fiduciary duty premised upon the co-promoted agreement as the two sides were to have split revenue on the proposed fight. It goes on to claim that since the co-promotion is considered a joint venture, GYM breached a fiduciary duty to Main Events for not going through with the co-promotion.
Fraud by Stevenson’s Promoter
Main Events has sued Stevenson’s Promoter, Yvon Michel, personally for fraud as it is alleged that he represented to Main Events that it “had nothing to worry about” regarding the agreed Stevenson-Kovalev fight and Haymon’s involvement was a mere way to “increase the rights fees for the unrelated interim bout.” The interim bout that is being referred to was a fight in Montreal between Stevenson and Andrzej Fonfara. Stevenson fought Fonfara in late May on Showtime. In that fight, Stevenson hit the canvas once, but eventually won a decision over Fonfara.
Tortious Interference with Contract
Main Events claims that Haymon, Golden Boy, Stevenson and Showtime based upon the set of events, claims it had a deal for Stevenson-Kovalev, but the defendants interfered with that contract.
Interference with Prospective Economic Advantage
Premised upon the alleged agreement for a fight between Stevenson-Kovalev, Main Events contends that Haymon, Golden Boy, Stevenson and Showtime interfered with an existing contract for the fight and that there was “a reasonable expectation that plaintiff [Main Events] would have economically benefitted from the business relationship.” Essentially, Main Events claims that it would have benefited (and it would have) from the fight between their fighter and Stevenson. But there was interference which caused Stevenson to back out of the agreement.
This is another example of the competitive nature between HBO-Showtime and Top Rank-Golden Boy. Actually, here its Main Events. Since the lawsuit was filed, Schaefer has left Golden Boy and the move may impact this lawsuit as it relates to the accusations between the companies. The latest has a Summons issued to Schaefer in Laguna Beach, California. A pretrial conference that was to occur last week has been pushed to July 11th.
As for the legal maneuvering, it’s likely that Haymon, et al. will file a motion to dismiss the Complaint premised upon the argument that there was no binding contract between Main Events and GYM, and as such, there was no breach. Premised upon the fact that there was no breach, there would be no fraud by Michael or interference with a contract.
The lawsuit underscores the power of Al Haymon in the boxing industry. It’s clear that he has a powerful stable of fighters and has had working relationships with Showtime. As many know, Haymon advises Floyd Mayweather. Main Events alleges that Haymon acts as manager to his boxer which circumvents the Muhammad Ali Act which attempts to protect fighters. The Complaint does not delve into this violation as it is not a plead cause of action at this point. However, if discovery commences in this lawsuit, we may see allegations of specific violations.
It will be an interesting lawsuit to follow and MMA Payout will keep tabs on it.
June 26, 2014
ESPN reports that Golden Boy Promotions has requested arbitration against former CEO Richard Schaefer. According to the report, De la Hoya and Golden Boy are requesting $50 million in damages from Schaefer although no allegations have been reported as to the claim.
The case is being sent to private arbitration per the terms of Schaefer’s employment agreement with Golden Boy. It likely had a clause that if there was a disagreement, in lieu of filing a lawsuit, the parties would agree to go to arbitration which is theoretically faster and less expensive. Thus, no lawsuit and it is unlikely that the general public will not know much of the evidence and testimony unless it is leaked.
While we may not know the claims against Schaefer, the speculation that Schaefer and Al Haymon may go into business together may be one of the claims Golden Boy is making. Golden Boy might claim that Schaefer breached his fiduciary duty as CEO by not acting in the company’s best interests. The recent Main Events lawsuit filed against Al Haymon paints the picture that Schaefer and Haymon have worked together (more on this lawsuit in the coming days). The legal action is not surprising considering the public departure of Schaefer and other staff as well as Floyd Mayweather.
June 22, 2014
With the New York Assembly not voting on a bill to legalize pro MMA in the state, the focus turns to Zuffa’s lawsuit against the state. A court order issued late last week will allow the parties to file Motions for Summary Judgment by July 3rd.
The remaining cause of action left from Zuffa’s lawsuit filed back in November 2011 is the claim that the present law banning MMA in the state is unconstitutionally vague. The Court dismissed the previous claims upon New York’s Motion to Dismiss.
The parties have until July 3rd to file a motion which would dismiss the final claim and end the lawsuit if filed by New York. Zuffa has the option of filing its own motion which may leave an opening for a possible settlement.
Responses to the initial Summary Judgment Motions are due on July 17th with Replies to those Response Motions by July 31st.
H/t: Jim Genia
Spoiler Alert. There will be a Motion for Summary Judgment. The end to this lawsuit could be near. Or, we could be hunkering down for more briefing. Discovery has closed for all intents and purposes and if the Court is not persuaded to dismiss the lawsuit on New York’s Summary Judgment motion, we will be getting ready for a trial.
If you were wondering how long after the Court receives the papers will the Judge make a decision. The lawyerly answer to that is: it depends. But if you want some guidance. New York filed its Motion to Dismiss in October 2012, a hearing did not take place until February 2013 and the ruling was not issued until late September 2013. Thus, we could wait almost a year for a ruling. Hopefully, it may happen sooner. But, we may be through another legislative session in New York before a ruling.
MMA Payout will keep you posted.
June 20, 2014
Earlier this week, EA Sports released the latest UFC video game which includes many of your favorite UFC fighters including Carlos Condit. However, gamers may notice that Condit will not have the lion tattoo that is on the side of his body for legal reasons.
As the Wall Street Journal reports, the tattoo was removed from the video game as a precaution from infringing on any copyright issue that Condit’s tattoo artist may have with its use. Previously, Condit’s tattoo artist sued defunct video game maker THQ for the unauthorized use of the tattoo in UFC Undisputed. Long story short, Escobedo asked for millions, the Bankruptcy Court quantified the use to the sum of $22,500 (the amount Condit was paid for the use of his likeness).
The move to digitally airbrush Condit of his tattoo underscores a big issue the National Football League Players’ Association (and likely other leagues) is facing when it comes to player tattoos and digital rights. One of the ways to protect itself from lawsuits is to have players get their tattoo artists sign releases.
Authenticity is something that sports video games have and the inclusion of fighters’ facial features, hair style, mannerisms and even their tattoos are important. College football games have come under fire for similar issues and we may see the elimination of any identifiable feature your favorite college player may have in a game. But that issue is a little different from the one here. However, it is clear that If you are Carlos Condit, you might be concerned with the fact that your likeness is not exact, which may impact your overall future brand. That argument is a little far-fetched but the issue of re-imaging personas due to concerns about being sued is a slippery slope we may see in future video games.