Court delays hearing on outstanding fact discovery issues in UFC Antitrust case

May 18, 2017

A hearing that was set for Thursday to discuss outstanding issues in the UFC Antitrust case has been continued until June 1st.

The hearing was requested to determine outstanding discovery issues.  The fact discovery deadline was May 1, 2017.  However, Plaintiffs argued that the UFC had not turned over certain documents that would facilitate the depositions of Dana White and others.  It also indicated that it had yet to receive non-party information from outside parties.   The UFC claimed that Plaintiffs were reopening fact discovery.  It did concede to a 30 day continuation of fact discovery.

A portion of the Order from Pacer reads:

IT IS ORDERED that the [52] Ex Parte Motion to Continue Hearing is GRANTED, and the hearing currently scheduled for May 18, 2017, at 1:45 p.m. is VACATED and CONTINUED.

Motion Hearing set for 6/1/2017, at 9:30 AM in LV Courtroom 3B before Magistrate Judge Peggy A. Leen.

Payout Perspective:

It looks like the Court would like the parties to “meet and confer” on their outstanding issues themselves and come up with a plan.  The deposition of Dana White is notable as Plaintiffs are seeking text messages from several phones in possession of White.  While the UFC claims to have turned over these records, Plaintiffs have stated that there are more texts not produced.  It does look like that we are in a holding pattern until there is some resolution of discovery issues.

Zuffa responds to Plaintiffs’ letter to the Court

May 10, 2017

Zuffa has responded to Plaintiffs’ letter to the Court requesting a status conference on outstanding discovery issues.  In its letter to the Court, they clarify issues asserted for the Plaintiffs and indicate that they are willing to extend the fact discovery deadline until June 15, 2017 but no new fact discovery requests.

The fact discovery deadline was May 1, 2017.  This would have been the last date in which Plaintiffs would have been able to obtain documents from Zuffa as well as non-parties (e.g. Bellator).  Notably, a Motion to Compel documents from Zinkin Entertainment is set for June 23, 2017, well past the deadline.

The Zuffa letter states that it has turned over 6,800 texts from two cellular phones used by Dana White.  Plaintiffs claimed that White had four phone numbers and likely four phones.

Zuffa asserts that it is willing to extend the fact discovery deadline but not 60 days, nor open it up to new discovery.  They contend, citing the letter Plaintiffs sent to Bjorn Rebney, that Plaintiffs have performed extensive discovery.

Zuffa's Response to Ps Statement by JASONCRUZ206 on Scribd

The status conference is set for May 18, 2017.

Payout Perspective:

Using your own words against you hurts and this is what Zuffa attempts to do with the letter Plaintiffs sent to Bjorn Rebney in order for him to “cease and desist” from going forward with MMAAA.  The letter writing fight should be settled on May 18th and likely both sides will not be happy.  But, Zuffa’s letter advises the Court that Plaintiffs had ample time to obtain discovery while still seeming reasonable in proposing an extended date for discovery.

Plaintiffs in UFC Antitrust lawsuit seek status conference to decide outstanding issues

May 7, 2017

Attorneys representing the Plaintiffs in the UFC antitrust lawsuit have requested a status conference with the federal magistrate to discuss outstanding issues that may impact the prosecution of its class action lawsuit.  The letter with the Court was filed on Friday, May 5th.

The Plaintiffs list several issues as to request a hearing with the Federal Magistrate, the judge that decides discovery issues.

Statement to Court by Plaintiffs by JASONCRUZ206 on Scribd

Among the outstanding issues Plaintiffs would like to discuss include:

  • Plaintiffs’ Emergence Motion for Extension of Discovery Deadline and Case Management Schedule;
  • Plaintiffs’ Motion to Challenge Work Product Designation;
  • Non-Party Bellator’s Motion to Quash or Modify Subpoenas;
  • Third Party AXS TV LLC’s Motion to Quash Deposition Subpoenas of Mark Cuban (Plaintiffs’ response is due on May 8, 2017 according to the letter and similar to the Bellator issue, would like to move them to the District of Nevada.

As of the date of the letter, the Court has not ruled on any of the above motions.  Also, it has yet to hear the Motion for Summary Judgment of Plaintiff Nate Quarry.

Plaintiffs claim that these issues coupled with issues of preservation regarding obtaining text messages from Dana White’s four separate telephone numbers (and likely the same number of phones) as well as other documents not produced for key Zuffa witnesses have blocked the prosecution of the case.

Payout Perspective:

The need for all the information possible prior to a deposition is because Plaintiffs know they get one shot at deposing the witness and if they do not have the documents prior to the deposition they will not be prepared to ask questions related to the documents that may relate to their case.  In addition, Plaintiffs’ dilemma with non-parties is having the possibility of needing to litigate those matters as well.  Zuffa will likely respond to the letter and the Court will need to make a decision on whether to hold a hearing, decide the above issues or go forward with the current court deadlines.

Attorneys in UFC Antitrust Lawsuit Fight over Extension of Discovery Deadline

April 6, 2017

The parties in the UFC Antitrust lawsuit are battling over extending the discovery period with plaintiffs requesting more time and Zuffa attorneys arguing that the deadline should not be extended.  Plaintiffs are requesting a 60-day extension of the fact discovery period and remainder of the case schedule.

According to court rules, discovery, the process of requesting for and receiving information from the opposing side and third parties must be performed by a certain deadline as dictated by a case schedule or relevant rules.

The Plaintiffs request additional time to take the depositions of UFC personnel as well as certain third parties.

Plaintiffs also stated that it is issuing a subpoena for a “person most knowledgeable” at WME-IMG.  They note that this deposition will need to happen after the April 30, 2017 deadline (court rules require a 30 day notice for subpoena for depositions unless otherwise arranged by the parties).

In its motion, Plaintiffs state it has produced a total of 64,337 responsive documents totaling 206,403 pages.  It has reviewed approximately 323,000 emails and attachments 100,000 social media files and more than 6.6 million files from the six named Plaintiffs’ electronic storage devices to produce the 64,337 documents.  Also, it has defended the depositions of five of the six named plaintiffs with Cung Le’s depo occurring on April 11th.  Plaintiffs state that Defendants have produced more than 760,000 responsive documents but has not produced a privilege log which would detail the types of documents it has withheld due to attorney-client privilege.  Also, Plaintiffs claim that Zuffa “back-loaded” (provided documents later, than sooner) its production of documents.

On the other hand, Zuffa argues that the time should not be extended due to Plaintiffs’ inaction in not completing discovery.  It also claims that they are blaming Zuffa for the delay which, of course, Zuffa denies.

Zuffa argues that Plaintiffs’ request is similar to that the Court has already ruled on in September 2016 when it gave a 30-day extension.  It also states that Plaintiffs did no serve a second set of discovery requests until August 2016.  In response to the lack of privilege log, Zuffa states that due to the size and breadth of the number of documents involved, it has taken “some time to compile and complete.”  It notes that it will serve its privilege log on April 7, 2016.  It also compares Plaintiffs privilege log with a universe of 855 documents versus Zuffa’s of “more than 30,000.”

Payout Perspective:

These types of discovery fights happen all the time although maybe not involving such a voluminous number of documents.  For either side to use an argument in which they state the number of documents reviewed and produced may be a “straw man” argument since it’s not the quantity of documents but what is contained in the discovery.  The unique nature of this litigation which includes third parties that have or threatened to quash subpoenas have likely contributed to the delay.  Also, scheduling depositions is another issue as they must accommodate scheduling.  Plaintiffs could have unilaterally scheduled depositions to ensure that the depositions were noted.  Of course, there would have been risk as to preparation and also whether or not they had the necessary documents to ask witnesses.  Expect the Court to make a decision on this shortly.

Show Money Episode 15 talks Mayweather-McGregor, Bellator, WME-IMG, Hunt-UFC and more

March 26, 2017

We’re back: Gift and Nash of Bloody Elbow and yours truly discussing Mayweather-McGregor, Bellator, WME-IMG, Hunt-UFC and I get mad at a judge.

Zuffa files opposition to Bellator motion to quash subpoena

March 9, 2017

Zuffa has filed its opposition to Bellator’s Motion to Quash Subpoenas issued by the company in its lawsuit filed by former fighters.  Zuffa argues it is in need of three requests it made to Bellator and made exhaustive attempts (over 18 months) to work with the company on narrowing the scope.

Zuffa claims it does not normally seek non-public information from a competitor but they must have access “to defend against the antitrust lawsuit…”

A Federal Magistrate will hear the arguments from both sides on March 29th in Los Angeles.

The three requests at issue are:

  1. Bellator’s unredacted contracts;
  2. Documents regarding its negotiations with athletes; and
  3. Limited financial information including profit/loss statements and financial projections.

Zuffa claims that the request for contract documents will show the “intense competition” within Plaintiffs’ “Elite Professional MMA Fighter services” market.  Documents regarding negotiations with athletes will also demonstrate that the UFC is not the “only game in town” and there is competition for fighters.  It will also show that Bellator offers its athletes competitive compensation.  Additionally, argues that Bellator’s Financial Information will reveal that it has not been foreclosed from the alleged market set by Plaintiffs.

It also argues that the requests are proportional to the needs of case.  Essentially, Zuffa is asking only what it needs from Bellator and rebuts the Viacom-owned company’s assertion in its Motion to Quash that the requests are not proportional.  In its brief, Zuffa cites the importance of the documents indicating “…issues at stake in the Nevada Action have the potential to fundamentally reshape the entire MMA industry.”

Zuffa attorneys argue that confidential information would not be made public or even disclosed to Zuffa.  The protective order currently in place allows Bellator to designate its information with the title HIGHLY CONFIDENTIAL – ATTORNEYS” EYES ONLY.  This would ensure that the public or Zuffa employees would never see the information.  This discovery designation is sometimes utilized in highly sensitive cases with company documents.  In addition, Zuffa cites case law (notably, no cases in the 9th circuit, the controlling authority for this court) citing that motions to quash are “routinely denied”  when there are “adequate protections for the commercially sensitive information.”

It also argues that in the antitrust lawsuit in Nevada, Zuffa has produced over 651,000 documents with 241,00 identified as Highly Confidential.  The Plaintiffs, according to Zuffa, have produced approximately 64,000 docs with 4,300 docs identified as highly confidential.  Third parties have produced 241,000 docs with 2,800 being designated as highly confidential.  Zuffa makes the point that none of the highly confidential documents were disseminated to anyone other than attorneys and experts in the lawsuit.  Thus, Zuffa and/or the Plaintiffs have not seen any of the documents flagged highly confidential.

The opposition briefing includes two declarations.  One from one of Zuffa’s attorneys highlighting the account of how it attempted to work with Bellator on accessing the documents under the subpoena requests.  Another declaration is from a Zuffa-retained expert citing the need for the documents requested to address the issues in the antitrust lawsuit.

Payout Perspective:

You can expect the Federal Magistrate that will hear this motion to weigh the benefits of producing the documents against the business trade secrets of Bellator.  If you are Bellator, you are fighting this to the end because there is always a chance that someone (knowingly or unknowingly) violates the terms of a protective order.  At that point, you can’t unring the bell.  Zuffa wants to appear reasonable to the magistrate and indicates that it is willing to continue to work with Bellator to get the documents it needs.

The hearing is March 29th in LA.  MMA Payout will keep you posted.

Zuffa Opposition to Bellator Motion to Quash by JASONCRUZ206 on Scribd

Zuffa files Partial Motion for Summary Judgment to dismiss Nate Quarry from antitrust lawsuit

February 2, 2017

Zuffa has filed a motion for partial summary judgment to dismiss the claims of antitrust plaintiff Nate Quarry based on statute of limitations.

The motion was filed yesterday and requests an oral argument although that is not guaranteed.

The motion seeks to dismiss Quarry’s claims based on his promotional, bout and merchandise agreements with the company and deposition testimony.  The motion claims that Quarry’s claim is barred by the Four-Year Statute of Limitations.  In the alternative, it states that the “continuing violation exception” does not apply to his untimely claim.

“Distilled to its essence, Mr. Quarry’s claim challenges the scope of the UFC Identity Rights he contractually granted to Zuffa, the duration of those grants, and the payments he received in return—all terms in his 2004, 2005, and 2008 Promotional Agreements; his 2008 Merchandise Rights Agreement; and his January 2010 Bout Agreement.”

Zuffa argues that Quarry’s “last relevant agreement with Zuffa was executed in January 2010, but he chose to file suit in December 2014.”

15 U.S.C. section 15b limits antitrust claims to a four-year statute of limitations.

Zuffa also claims that Quarry’s claim should not be allowed through the “continuing violation exception.” This exception would override a statute of limitations defense.  However, Zuffa argues that relevant case law precludes such an exception since Quarry signed his Identity Rights outside the limitations period.  Even if Quarry argues that he received a benefit after the limitations period (i.e. after January 2010 and within four years from the filing of the lawsuit, thus being within the time to sue), there was not a new “overt act” performed by Zuffa which would restart the statute of limitations.

The motion was filed with Quarry’s promotional, bout and merchandise agreements but they were filed under seal meaning that public does not have access to them.

Payout Perspective:

Quarry was deposed by Zuffa and you can see the strategy was to probe him for information to try to dismiss his claims from the lawsuit.  Similarly, we would probably see this happening with other UFC veterans.  Plaintiffs will have until mid-February to oppose the motion.

White finds fighter association in-fighting ‘hilarious’

December 11, 2016

With an ultimatum made by plaintiffs’ attorneys on behalf of the fighters suing Zuffa to the MMAAA, Dana White appears to be the winner at this point.

In an interview with TSN, White finds the current state of organizing fighters hilarious.  He has specifically called out Bjorn Rebney, the former Bellator head.  On the UFC Unfiltered podcast, he referred to him as “Bjork.”

Last week, the MMAAA was unveiled with Rebney as an unpaid strategic adviser according to the organization.  This week, plaintiffs’ attorneys in the Le, et al. v. Zuffa, LLC, et al. sent a “cease and desist” letter to Rebney on behalf of MMAAA advising them that they were the court appointed representative of the class of fighters that Rebney’s group is seeking.  Moreover, it was revealed in the letter signed by Eric Cramer, that Rebney met with the plaintiffs’ attorneys at CAA offices in New York.  The meeting was to determine whether the two sides would come together.  However, according to Cramer, Rebney wanted input as well as a portion of costs related to his fees associated with putting together what was to become MMAAA.  Of course, MMAAA denies this.

White has called Rebney a “bottom-feeder” stating that he is out to make money implying that he does not have the interests of fighters in mind.

Payout Perspective:

With the PFA, MMAAA and MMAFA seeking to advocate for the rights of fighters but competing with each other at the same time, White has to find it amusing.  While each of these groups are seeking to bargain with the UFC for better pay, pensions and other interests, they need a unified front of fighters.  But, with competing interests on the fighter side, the UFC has no obligation to negotiate with any of these groups.  Aside from the lawsuit, which UFC lawyers are dealing with, the UFC will likely just wait and see if there is any need to address any of these groups.

MMAAA given “cease and desist” ultimatum by antitrust lawsuit plaintiffs

December 7, 2016

The MMAAA issued an “urgent news” statement as it appears that lawyers in the UFC antitrust lawsuit have issued a “cease and desist” letter from signing up fighters from joining the organization.

The statement was issued by Jim Quinn and Eric Hochstadt, outside counsel for the Mixed Martial Arts Association:

As Georges St-Pierre, Donald Cerrone, T.J. Dillashaw, Tim Kennedy, and Cain Velasquez made clear in the official public announcement last week, the Mixed Martial Arts Athlete Association (“MMAAA”) is all about looking out for the fighters and their well-being long-term.

Yesterday, the MMAAA received a “cease and desist” letter from a group of lawyers seeking to stop the MMAAA from signing up fighters and sticking up for their rights against the UFC and its owners WME-IMG.  The MMAAA will do no such thing.  Those lawyers – who represent only a few fighters – are focused on getting some money out of one case, of which they seek a significant portion for themselves.  Those lawyers do not speak for anyone else, and certainly not the MMAAA and all the fighters the organization represents now and will quickly grow to represent in the sport.

Over a year ago, those same lawyers reached out to the MMAAA to join forces with us.  We had a meeting and made clear that the MMAAA’s primary focus would be on achieving three core goals: 1) substantially increasing UFC fighter pay to 50%; 2) securing all-encompassing long term benefits for UFC fighters; and 3) a settlement to compensate past and current UFC fighters for all of the UFC’s wrongs.  To achieve these goals for the benefit of the fighters, we also made clear the MMAAA needed to receive a percentage of a monetary settlement to cover the costs to fund the MMAAA for staffing and attorneys both for past work getting to this point and the long fight ahead.  The lawyers made clear that they did not share the MMAAA’s vision.  They are focused on a short-term monetary recovery, of which they will seek 33%, and then they are gone from this sport.  We parted ways at that point.

The MMAAA is all about the fighters benefitting when the UFC is finally forced to take a powerful group of the fighters seriously.  The MMAAA will be executing on that plan and will not be stopped in this effort on behalf of fighters.

Although the lawyers identified in the statement were not named, but they represent the fighters in the antitrust lawsuit, Cung Le, et al. v. Zuffa, LLC, et al.

John Nash at Bloody Elbow obtained the letter from Eric Cramer, co-lead counsel for the plaintiffs’ attorneys representing the former UFC fighters suing the company sent a letter to Bjorn Rebney.

Letter to Rebney From Cramer by JASONCRUZ206 on Scribd

The letter issues that Rebney’s group cease and desist from operating which essentially means for it to stop pursuing fighters to join the organization.  It argues that the court has granted the attorneys to represent the class of fighters and MMAAA’s effort would be interfering.

Notably, the letter states that Rebney’s group wanted to be a part of the UFC Class Action and met with CAA in New York.  At the meeting, which took place in October 15, 2015, Rebney revealed MMAAA and stated that they would start another antitrust action if certain demands were not met.  The letter also reveals that Rebney and MMAAA might be contemplating an MMA promotion.

The letter gives Rebney and MMAAA December 9th to cease and desist from operations.

Payout Perspective:

The plot thickens.  It’s clear that when Rebney cited a “settlement” from the UFC, it would spark concern from the PFA and the plaintiffs in the antitrust lawsuit.  Clearly, the plaintiffs have invested a great deal thus far in litigating against Zuffa.  For MMAAA to come in at this point, and based on what Cramer reveals in his letter, this is unsettling to the plaintiffs and their attorneys.  Of course, MMAAA explains in their statement the reasons for seeking costs related to its own work on behalf of the fighters.  What is the truth?  Hard to say, but what we can gather is that there may be another lawsuit on the horizon if MMAAA and the plaintiffs in the antitrust case cannot find a way to settle the issue.

Dana White target for deposition in antitrust lawsuit

November 14, 2016

The Sports Business Journal reports that lawyers on behalf of former UFC fighters intend to depose Dana White as part of the antitrust lawsuit ongoing in federal court in Nevada.

The lawsuit is in its discovery phase with both lawyers for the plaintiffs and lawyers for the UFC exchanging documents.  Depositions involving key witnesses has commenced.  Notably, the article indicates that Nate Quarry has been deposed by the defendants.  Plaintiffs lawyers intend to depose Dana White in likely questioning about the UFC’s business practices which relate to their antitrust claim.

Discovery ends May 1, 2017 which means that we should see more UFC executives deposed by the plaintiffs’ attorneys as well as some of the former fighters which may include Cung Le, Jon Fitch and Brandon Vera.

The article indicates that plaintiffs’ attorneys may seek to depose executives from the new ownership group at WME-IMG as well.

Payout Perspective:

It will be interesting to see if and when they depose White.  His deposition is likely imminent since he’s had a major hand in the operations of the UFC when the alleged issues have occurred.  We will see if plaintiffs’ attorneys will be able to obtain his testimony from the FTC investigations as well as previous lawsuits involving the company.  One might expect a lengthy deposition (i.e., multiple days) for White.

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