Austin Trout appeal brief argues for Ali Act to remain in court, not moved to arbitration

June 21, 2019

The Deontay Wilder-Alexander Povetkin/WOB litigation is not the only boxing appeal going on.  The Austin Trout-WCB appeal is occurring in the First Circuit.  Recently, Trout’s lawyers filed its Reply Brief to the WBO’s Answering Brief.

Austin Trout filed a lawsuit against the sanctioning organization he was contracted with citing his fall in the rankings without reason causing him to miss out on the possibility of a title shot.

The federal court in Puerto Rico sided with the WBO in a motion to compel arbitration.  One of the allegations was that the Ali Act could not be subject to arbitration.  However, the federal court determined that due to an arbitration clause in the contract, that any claims arising under the contract were subject to arbitration. Trout appealed.

In the Opening Brief of its appeal, Trout argues that sanctioning bodies could circumvent the court of law by seeking refuge in an arbitration which would be subject to a panel designated by the WBO.

There was no surprise when the WBO’s brief supported the federal court ruling and arguing that the Ali Act was in fact subject to arbitration.  It cites case law which supports the argument that statutory claims (like those in the Ali Act) may be the subject of an arbitration agreement despite the fact that the statutory language contemplates court action.  The overarching policy cited by the WBO is that there is the federal policy favoring arbitration.  Moreover, they contend that if the burden is on the party resisting arbitration to show that the statute in question “overrides the mandate to arbitrate.”

WBO Opposition Brief by on Scribd

In its rebuttal, Trout argues the legislative text behind the reasoning of the statue and trumps the policy of arbitration.  Essentially, the reason why the law was made.  Through this, Trout makes the argument that “the legislative intent is inapposite to a mandatory arbitration clause in which the entity against which claims of illegal, fraudulent and potentially criminal acts are attributed, will designate the individuals to decide upon such allegations.”

Austin Trout Reply Brief by on Scribd

The argument contends that the purpose of the law was to regulate the power of promoters and sanctioning bodies.  Thus, an arbitration agreement which would have the drafter choose its own arbiter (as it does here) would fly in the face of the Ali Act’s purpose.  As a result, Trout argues that the Ali Act cannot go to arbitration.

Payout Perspective:

Trout makes a sound argument in its reply brief in citing the legislative intent of the Ali Act was to protect fighters and regulate those that may take advantage of them.  Based on this, it cites that the contract signed by Trout allowing for arbitration of disputes should be overridden due to the fact it is contra to the Ali Act’s intent.  However, the WBO cites the policy to arbitrate rather than litigate as the superseding factor to proceed to arbitration.  The appellate court will have to determine the rationale for each.  Although it does not seem monumental, this decision could shape the future of the Ali Act considering that contracts may include arbitration clauses sending these claims to arbitration instead of courts.

As Austin Trout heads to ring on Saturday, his legal team has been fighting WBO in appeal of lawsuit

May 24, 2019

As Austin Trout returns to the ring on Saturday, last month his lawyers submitted their appeal brief in an effort to overturn a federal court decision to arbitrate his lawsuit, including his Ali Act claims.

For background of the case, you can go here.

The Court determined that based on legal rights under the Federal Arbitration Act, that arbitration was a suitable alternative instead of having parties going to trial

Appellant’s Brief.filed by on Scribd

In addition to its claims that the WBO waived its right to arbitration, Trout argues that the Ali Act cannot be arbitrated as it would fly in the face of the spirit of the act.  Essentially, its protections highlighted in the law runs contrary to the District Court ruling.

Trout alleges that the WBO violated the Ali Act when the promotion dropped him from its rankings.  In the alternative, it claimed that the Ali Act claims should remain in federal court even if the trial court decided that his other allegations could be arbitrated.

Trout’s appeal brief relating to the Ali Act claim argues that the intent of the legislation was to protect boxers from promoters and managers.  Trial court made an error when it granted the WBO to arbitrate its claims.

As stated by Trout’s attorneys:

“If allowed, compelling the arbitration of the claims under the Muhammad Ali Act will defeat the purpose of the Act.  Leaving Sanctioning Bodies, as the term is defined in the statute which includes the WBO, free to circumvent the must of courts of law over claims alleging the WBO is violating the Muhammad Ali Act, and will be able to ventilate such claims in arbitration before a panel designated by the WBO.”

The District Court stated that arbitration was a suitable alternative when agreed upon by the parties.  That is not the case here. It would appear that Trout agreed to the contractual obligations of the WBO and its arbitration clause provision embedded in the rules of the promotion and his contract.  Yet, upon closer scrutiny, the irony of the conclusion by the District Court is that it is inapposite to the outcome that the Ali Act wish to have prevented.  Here, the appearance that a promotion is taking advantage of a boxer through a coercive contract.  In his lawsuit Trout claimed that the boxer rankings of the WBO dropped him from its rankings, depriving him of a potential title fight.  The elimination rom the WBO ranking was not explained via written statement or to the Association of Boxing Commissions as required by the Ali Act.  Trout was left without an opportunity for a title shot and economic revenue through a chance to be champion.  For Trout, the contract of the WBO, as drafted an interpreted by the promoter, states that it would internally decide any grievance made by one of its contracted fighters.  For Trout, the contract of the WBO, as drafted an interpreted by the promoter, states that it would internally decide any grievance made by one of its contracted fighters.

The District Court ruling highlighted two cases which stated that arbitrations clauses in contracts would override the right to trial.  However, there are strong dissents to those cases. As a result, the WBO appears to sweep the Ali Act into the arbitration for Trout’s other claims listed in the lawsuit.

Trout decided to sign a contract with the WBO.  There is no argument set forth by the parties that Trout did not have an opportunity to negotiate the contract he signed with the promoter.  Yet, it would seem that Trout was unaware that if he had an issue down the road with his contract, that the dispute would go to arbitration where the arbiters of the dispute were chosen by the WBO.  This would appear to be contrary to the filing of this lawsuit. Moreover, the overarching protection for boxers, found in the protections highlighted in the Ali Act, such as contractual disagreements, fraud or issues with rankings, could be usurped with one fail swoop in a contractual clause.

In its Order Compelling Arbitration of Trout’s Ali Act claim (see embedded opinion below), the Court order does not address the strong dissent in Mitsubishi Motors v. Soler Chrysler-Plymouth which it cites in its opinion.  The dissent, written by Justice John Paul Stevens, brought up strong questions regarding the arbitrability of the case and which similarly resonate with the present case here on appeal.  In Mitsubishi Motors, Justice Stevens noted that it was the first time that the Court held a statutory claim to be arbitrable.  “It is reasonable to assume that most lawyers and executives would not expect the language in the standard arbitration clause to cover federal statutory claims.”  This was premised upon the belief that the complexities of the issue in Mitsubishi – an antitrust matter – was too complex to arbitrate.  Neither party has brought up any case in combat sports which has tested the complexities of the Ali Act simply because there are few and far between.  This would seem to conclude two points.  First, it is unknown whether the issues in the Ali Act are complex for that of a private arbitration.  Secondly, the Ali Act legislative history which is included in Trout’s appellant brief, contemplates that aggrieved boxers may file a lawsuit and have those issues determined by a Court and not through arbitration.

In CompuCredit v. Greenwood, Justice Ginsburg notes in her dissent that the Federal Arbitration Act remains the Court’s “responsibility to examine carefully “the text of the [statute], its legislative history,” and Congress’ “underlying purposes.”  The District Court cites the Federal Arbitration Act as superseding Trout’s cause of action.

The passages from two dissenting opinions are not profoundly authoritative.  However, they provide shed a light on the rationale behind the Ali Act and the recognition that the District Court ruling contradicts the legislative intent of the establishment of the law which is the protection for boxers.

While we await the Answering Brief from the WBO, the Trout case seems to have gone under the radar of many boxing fans, it is a huge case for the Ali Act and the future of the law.  If promoters are allowed to skirt the meaning of the rule by utilizing arbitration clauses in its contracts deeming itself or a self-appointed arbiter as the self-binding authority, it would render the Ali Act toothless, mute and useless for the boxers it sought to protect.

MMA Payout will continue to update you.