October 5, 2015
Welcome to another edition of Payout Perspective. In this edition, we take a look at UFC 192 taking place from Houston’s Toyota Center where Daniel Cormier took on Alexander Gustafsson in DC’s first title defense of his Light Heavyweight title.
DC wins split decision against Gus
Clearly, it was the most entertaining fight of the night. Alexander Gustafsson lost his second shot at the 205 title. If there’s a consolation, and really there is not, it’s that Gustafsson puts on great fights. His fight with Jon Jones was a classic and this was almost as good. Unfortunately for Gus, he did not win enough of the skirmishes against DC. His running away style probably did not help either.
Cormier may have hurt his foot during the first round which makes his performance that much more remarkable. Notably, he’s only suspended until November 18th. It appear that he is set for a rematch with Jon Jones. On the other hand, Gus is out until April 1 and we won’t see the Swede until sometime into 2016.
Bader defeats Evans
Ryan Bader is moving his way up the light heavyweight rankings. Believe it or not, he might be next in line for a title shot and/or the next opponent for Jon Jones if something happens to DC. Bader outlasted former UFC light heavyweight champion Rashad Evans. Evans tired as the fight progressed and was not the same fighter that he was before his 2 year layoff.
Of the four events held at the Toyota Center, UFC 192 was the lowest output of the four drawing 14,622 for a gate of $1,859,000.
Via MMA Junkie:
- UFC 166: 17,238 ($2,500,000 live gate) –main event Cain-JDS
- UFC 136: 16,164 ($2,230,000 live gate) –main event Edgar-Maynard III
- UFC 69: 15,269 ($2,817,200 live gate) – main event GSP-Serra
- UFC 192: 14,622 ($1,859,000 live gate) – main event DC-Gus
The $50,000 bonuses went to DC-Gus for Fight of the Night, Albert Tuemnov and Adriano Martins for their performances on the prelims. Sage Northcutt and Rose Namajunas likely drew undisclosed bonuses as well.
Promotion of the Fight
The UFC Embeddeds spurred the promotion of the fight as usual and this time we saw Halo 5 as the presenting sponsor for the videos.
Tyrone Woodley had the opportunity to throw out the first pitch at a St. Louis Cardinals baseball game. We saw this during the Embedded episode. We also saw the fighter make their various media rounds.
It would have been interesting to see what transpired when it was determined that Johny Hendricks could not fight and the reaction by Tyrone Woodley once he knew. Woodley was told by the media so there should have been footage. Despite losing his fight, Woodley still weighed in to show UFC execs he’s a professional. For his efforts, White offered him the next title shot…and then wavered later that night.
The aforementioned Microsoft was in the Octagon and the UFC prep point as it promoted the release of Halo 5, the latest edition to the video game series for the Xbox video game platform. In addition, Draft Kings, Corn Nuts, Harley Davidson, Toyo Tires Metro PCS, Corn Nuts, Bud Light, UFC Fight Pass and Monster Energy Drink had the center. The addition of Fight Pass seems to be a push by the UFC as it relates to the new content it added recently.
Despite the loss of the in-ring octagon opportunities, Bad Boy is still sponsoring Alexander Gustaffson. A new signature collection of shirts were released by the company prior to UFC 192. Gus also helped with the promotion of Halo via twitter.
— Alexander Gustafsson (@AlexTheMauler) September 29, 2015
Odds and ends
The biggest star of UFC 192? Sage Northcutt. Looking at the google searches, he was pretty popular. He even had a brief cameo on UFC Embedded which probably was due to the elimination of Hendricks-Woodley. He was second to Jon Jones in terms of fighter google searches at the start of the event (see below).
One of the bigger disappointments of UFC 192 was the scratch of Johny Hendricks from the event. His fight with Tyrone Woodley was taken off the card.
No original “Face the Pain” opening to start the PPV? Is nothing sacred? In all seriousness, the best part of the opening montage was seeing the Rashad Evans KO of Chuck Liddell from UFC 88 in the opening montage. It was a great, an unexpected KO and also gave some visibility to his homage to Bill Gates post-fight. Gates was once arrested (for an undisclosed reason) in New Mexico and the shirt is the mug shot. Perhaps the greatest shirt we will never see again thanks to the Reebok-era.
Perhaps the best promo videos for a UFC PPV was played after the DC-Gus fight for November’s UFC 193 with Ronda Rousey taking on Holly Holm. What set the PPV promo apart was that it told a story and clearly was focused on the power of women in that they can do anything.
The Houston Rockets Dwight Howard made an appearance at the event. UFC fighters visited a Rockets practice as seen on Embedded. James Harden and Patrick Beverley of the Rockets as well as Howard spoke with DC, Evans and Woodley.
Per The Wrestling Observer podcast, Ali Bagautinov was not tested prior to UFC 192 despite the fact he previously tested for EPO at UFC 174.
The UFC 192 Countdown Show on FS1 drew 96,000 viewers via Sports TV Ratings. It aired opposite Monday Night Football. Usually, the ratings are low due to the fact that the Countdowns are typically online so there’s less of a need to find on TV for fight fans.
Joe B is marrying Megan Olivo? Congrats.
Two boxing events on HBO and Showtime, college football and even Brock Lesnar on the WWE Network competed with the UFC Saturday night. For a while on Saturday morning, the Japanese Rugby Team drew more searches than the UFC. Later in the day Saturday, the searches picked up. But, there was nothing that stood out to give the casual fan a reason to purchase this PPV. The loss of Hendricks-Woodley probably detracted some serious MMA fans from purchasing the event but in the end, this event was likely not going to surpass 350,000 buys. The 350,000 buy mark might be optimistic as a 275-300K range is probably more realistic.
October 4, 2015
A new wrinkle may surface in the quest to legalize professional MMA in New York. With a new lawsuit filed by the UFC, a preliminary injunction request filed to hold an event this April, a nuanced detail may trip up the legal strategy.
In its new court filings, the UFC indicates that it has licensed with the World Kickboxing Association (“WKA”) to hold the event in April. The WKA is an exempt organization under the Combat Sports Law (“CSL”) which bans the sport in the state. As an exempt organization under the law, it may promote events notwithstanding the law. Basically, it may hold an event in the state despite the ban.
As indicated by Jim Genia, if a law legalizing professional MMA is passed in Albany prior to an anticipated UFC at MSG this April, the UFC may have some issues. The reason being is that if the law banning professional MMA in the state is repealed, the exempt organization carve out allowing organizations, such as the WKA to sanction events will also fall by the waysideIf this happens, the UFC’s event in April may be in trouble since the UFC has stated that it is working with WKA to sanction the event.
The legislative session begins in January and there is no way to know when, or even if, an MMA bill legalizing the sport and/or repealing the ban will ever matriculate its way through the various committees, state senate and eventually to the state Assembly for a vote. If it finds its way to the Governor’s desk for signing, the UFC may have a problem.
There are two big “ifs’ here (among other questions).
- The UFC must pass a hurdle of getting the court to grant its preliminary injunction request. Look for stern opposition from the state of New York and an appeal if it loses. The big news on this, is that if an appeal occurs, there may be a stay in the lawsuit until the appeal is heard. Thus, it would freeze the new lawsuit until resolution from the Court. Something like that could take us past the UFC’s intended April event date.
- If the UFC wins its preliminary injunction (and for some reason there is no appeal and/or resolves in the UFC’s favor), the MMA law in Albany would have to get through before the UFC’s April 23, 2016 date at MSG.
Let’s face it. I don’t bank on a law passing prior to April 23rd based on what we’ve seen in recent years from New York lawmakers. MMA supporters have waited for a law to pass legalizing MMA in the state. The past several years we’ve waited and waited until the final days of the legislative session in June for a vote in the state assembly (the last hurdle before reaching the governor’s desk). Yet, none has occurred. Even if a law is passed this year, I doubt it occurs prior to April’s UFC event.
I would suspect that if the UFC wins its preliminary injunction (and any appeal that might occur), it may ask pro-MMA supporters within the legislature (and its lobbyists) to push an MMA bill, but have it occur after the April event. In the alternative, they could always request the UFC be grandfathered into the MMA law. Essentially, allowing the WKA to sanction the event but after the event, the MMA law would come into effect. This assumes that the legal process is swift, which it is not.
First things first, a court will consider the UFC’s preliminary injunction request and at some point the UFC must win for an April event to happen.
October 4, 2015
The UFC provided an official response to the Deadspin article written by Josh Gross which reported that the UFC may have known that Vitor Belfort had been using synthetic testosterone.
According to the Deadspin article, an email erroneously sent by Zuffa to fight managers and others with Belfort’s drug test results prior to his title fight with Jon Jones at UFC 152 showed that he had free testosterone levels that were two and a half times above that of the average man for his age. Zuffa attempted to claw back the email and threatened those that did not delete it with “judicial remedies” if they did not comply.
Eleven days after the Deadspin article was published, the UFC finally responded to the article. Notably, UFC’s PR head Dave Sholler responded with stating that a “cover-up” was “categorically false.”
Via MMA Junkie:
“Any suggestion or inference there was a cover-up is just categorically false,” Sholler said. “That period of time with TRT is one that was very tricky for everyone – for the UFC, for athletic commissions, and for athletes alike.”
Bloody Elbow added additional insight on the Belfort situation to which the UFC did not respond to requests for comment as noted in the article. It is not known whether the UFC has responded to this article specifically although one might guess it would be the same response as that given regarding the Deadspin article.
Notably, Dana White was not the one making the statement on the Deadspin article at the news conference Saturday night. It’s interesting to point out that it took USADA 8 days to reply to a scathing report by Thomas Hauser although it had issued a press release denouncing the article a day after Hauser’s article was published. The UFC response (or lack thereof) is an interesting view on media relations and the need to respond to news which affects the company. Perhaps the UFC thought that not responding to the article would mean it would go away. This does not seem like the way to address a PR situation. We shall see if there will be more of a response to the UFC or if we see them attempt to get past the situation.
October 4, 2015
The numbers were announced at the post-fight news conference. The UFC drew 14,622 fans for a live gate of $1.859 million at Houston’s Toyota Center. It was the fourth event at the venue for the UFC and the lowest output of the four.
Via MMA Junkie:
- UFC 166: 17,238 ($2,500,000 live gate) – main event Cain-JDS
- UFC 136: 16,164 ($2,230,000 live gate) – main event Edgar-Maynard III
- UFC 69: 15,269 ($2,817,200 live gate) – main event GSP-Serra
- UFC 192: 14,622 ($1,859,000 live gate) – main event DC-Gus
In addition, the bonuses were announced at the news conference with Daniel Cormier, Alexander Gustafsson, Albert Tumenov and Adriano Martins receiving the $50,000 bonuses.
No-brainers when it came to the bonuses although Sage Northcutt and Rose Namajunas could have staked claim to bonuses as well. One might expect them getting one of those “locker room” bonuses we hear about. The gate was the lowest of the four events at the Toyota Center despite the relative close proximity Cormier was to his hometown.
October 3, 2015
Johny Hendricks had to pull out of UFC 192 due to “weight cutting issues” according to Dana White on Friday. The loss of Hendricks versus Tyrone Woodley depreciates the entertainment value of the PPV Saturday.
Hendricks appeared at Thursday’s media day per MMA Fighting where he said he weighed 183 pounds – 13 pounds above the 170 pound weight limit (although technically he could have made it at 171 pounds since this was not a title fight). Hendricks said he was happy with the weight which seemed to mean that he expected to cut the rest of the weight prior to Friday’s weigh-ins.
But Hendricks indicated that his body shut down. Notably, Hendricks has had issues with weight in the past but split with nutritionist Mike Dolce.
After the weigh-ins, White indicated that Hendricks was 26 pounds over coming into fight week. This was not the case according to Hendricks’ representation. An MMA Junkie report does state that he may have started the weight cut late per his strength and conditioning coach.
The incident occurs the day after the UFC-USADA ban on IV rehydration took effect. For those wondering, Hendricks was given an IV at the hospital. Under the IV ban, the protocol allows for IV use in exigent circumstances. Still, White was probably correct in taking Hendricks off the card.
The loss of Hendricks-Woodley hurts the appeal of UFC 192. While there is the rumor that Jon Jones may be cageside to “confront” the winner of the Cormier-Gus fight, we’ve all been trained to wait for the highlights and/or find them online. So, a 10 second confrontation won’t do much to get buys. But Hendricks-Woodley would have been an entertaining semi-main event for Cormier-Gus. The loss of that fight may sway some semi-dedicated UFC fans. Moreover, with two boxing events on HBO and Showtime there will be split audiences for combat sports. UFC 192 could be facing stiff competition.
October 2, 2015
Ellen DeGeneres debuted the UFC 193 promo video on her own video channel, ellentube, on Friday. The video features Ronda Rousey as an 11-year-old as she discovers judo.
The daytime talk show host tweeted out the video to her 48 million viewers. The video has been viewed by over 124,000 at the time of this writing. Rousey appeared on “Ellen” a couple weeks ago. During the interview, the women’s bantamweight champ stated that she was a huge fan of Ellen and always wanted to be on the show.
— Ellen DeGeneres (@TheEllenShow) October 2, 2015
Similar to her appearance on Good Morning America, the promotion of Rousey’s next fight on Ellen’s channel should open up Rousey (and the UFC) to the women’s demo more than ever before. Ellen tweeting the video to her 48 million followers is unprecedented reach for the UFC. The promotional video is well-done and presents much more of a mainstream appeal than the usual UFC promo. Will it help sell the PPV?
October 1, 2015
As discovery begins in the UFC antitrust lawsuit brought by former fighters, plaintiffs attained a favorable ruling Wednesday as the court will allow one of the plaintiffs’ attorney, Rob Maysey, to access documents in discovery. The UFC identified Maysey as a “competitor” and wanted him precluded from access to some of the company’s confidential documents in discovery.
Plaintiff filed a protective order to which UFC attempted to strike. Magistrate Judge Peggy Leen ruled that the UFC could not keep plaintiffs’ attorney Rob Maysey from certain documents it would turn over in the discovery process.
Zuffa attorneys argued that Maysey was a competitor as part of a Mixed Martial Arts Fighters Association (“MMAFA”) as he may seek group licensing on behalf of UFC fighters. Maysey stated in a sworn declaration that “he does not own the MMAFA,” nor head the organization.
Maysey stated in his declaration that he was the “principal client liaison” to the fighters. Notably, he did not indicate he was trial counsel. In the end, it appears that the distinction made no difference to the Magistrate.
Judge Leen did not wall off Maysey from any part of the discovery process. There is no official opinion from the magistrate (the magistrate sometimes serves as a discovery ‘referee’ as opposed to the trial court judge in federal cases) as to the rationale behind the decision.
The parties have engaged in discussions related to the exchange of documents between the parties. Obviously, the key information is held by Zuffa. From the exchange of information, it sounds like a voluminous amount of documents will be handed over to plaintiffs’ encompassing an expansive list of areas.
Specifically, based on a back and forth of letters between the parties’ attorneys, the main argument was the retention and eventual disclosure of documents possess by Zuffa from 2000 to the present. Zuffa’s attorneys proposed a timeframe of 2010 to the present. Thus, there was a dispute over 10 years worth of documents. There was also a question over the preservation of emails as in the “parent/child” format or not. Yes, they want to look at a chain of emails and their response…and that response…and the response after that…..
As Bloody Elbow lists, the information that plaintiffs seek relate to financial documents, fight contracts, venue contract files, sponsor contract files, merchant contract files, list of TV contracts, 3rd party/analyst consultant reports, FTC Strikeforce documents and list of litigations/arbitrations.
The document production will be done via some form of electronic discovery I presume. To have the discovery performed via hand would be burdensome, unwieldly, time-consuming and downright difficult.
Thus, while discovery is starting, there is a proposal to have two phases to the production. But before those two phases, there is a likely document compilation that is happening or already happened. Basically, Zuffa has to upload documents into a database and run key word searches to find information relevant to what they are being asked. The company isn’t just going to unload a ton of its private business documents without looking through them. Moreover, it does not want to give plaintiffs more than it is asking for in their requests.
Thus, Zuffa will not just hand over the documents without review of them. Obviously, Zuffa attorneys and/or their personnel will ensure that the documents are responsive and do not reveal confidential, private and/or attorney-client/work product. They may produce docs but redact sections of them for an assortment of reasons.
From a practical standpoint, we presume there will need to be time taken for all of the documents to be amassed and scanned in to some sort of system (e.g., Concordance, KrollOnTrack, etc.). There will be some third party vendor that will create a database for the parties. Hence, providing documents in phases may be more a necessity than a proposal.
At that point, they can transfer them over to the plaintiffs who one assumes will have the same capabilities (i.e., databases) to review the documents and code them for responsiveness as well as make other types of notes. One would assume that they will code them based on subject matter, etc. This will help later on as when they go to deposition, they will run key word searches for relevant material and pull them out without digging around for hours.
In all likelihood, we will see additional back and forth related to the discovery requests.
All of the written discovery and production of documents will occur before any deposition for the obvious reason that attorneys will want to have all of the documents before them before deposing a witness. You only get one “bite of the apple” to depose someone (only in the most extreme circumstances can you get two shots to depose a witness). Expect the depositions of some of the key Zuffa executives such as Dana White and Lorenzo Fertitta as well as the fighters to last days.
While many people are very excited for the news of the UFC revealing their financials, I would not expect a “smoking gun” document or an “a ha” moment any time soon. Assuming there is information that Zuffa believes should remain confidential, and that plaintiffs believe they should have, there will be extensive “meet and confers” and even motions before the magistrate. Get ready and wait.
October 1, 2015
USADA has provided the names of the UFC fighters it has tested in the first round of its drug testing protocol. Ronda Rousey tops the list with the third party drug testing agency testing the women’s bantamweight champ 5 times.
Aside from Rousey, there was a tie for second-most tests with Bethe Correia, Thiago Alves and Antonio Silva being tested 4 times since the start of the UFC-USADA anti-doping program that commenced July 1.
Alves last fought in Brazil in May, losing to Carlos Condit. He slated to fight Benson Henderson at UFC Fight Night 79 in Korea this November. Silva fought at UFC 190, defeating Soa Palelei. He is scheduled to fight Mark Hunt at UFC 193 in November.
Rousey faced Correia at UFC 190 on August 1st. Rousey is slated to headline the UFC 193 card in Australia.
Notably, Josh Barnett was tested which we presume was related to his fight this past Saturday at UFC Fight Night 75 in Japan. Prior to the fight, Roy Nelson, Barnett’s opponent, noted he had not been tested at all. A USADA rep indicated that officials were in Japan to test fighters. The USADA database notes Nelson was tested once. We might presume he was tested post-fight this past Saturday.
In total, 50 fighters were tested and 81 tests were administered. The database provides transparency to who is (and who is not) being tested. There have yet to be any reports of a fighter failing a drug tests since USADA took over in July. Do you think that more fighters should have been tested during this period? Was testing Rousey excessive, or right as she is one of the top faces for the organization? This will be interesting to track.
September 30, 2015
The UFC surprised many with another lawsuit in federal court in New York challenging the constitutionality of the state’s ban on professional MMA. This time, the UFC is seeking a preliminary injunction to hold an event in the state this April.
The news of a new lawsuit comes when the original lawsuit is in the Second Circuit Court of Appeals. Paul Clement, the renowned appellate lawyer and former U.S. Solicitor General is representing Zuffa and filed their appeal brief this past August. New York’s response is set for the beginning of November.
But perhaps the road map for the lawsuit filed this week was provided by Judge Kimba Wood, the trial court judge that dismissed Zuffa’s case.
In deciding to dismiss Zuffa’s case, it offered the following in its conclusion (click to enlarge):
The opinion is mere “dicta” meaning that Judge Wood’s suggestion is not law or precedent which others may cite as guiding authority. Yet, it created the opportunity for the UFC to open up another line of action in attempting hold an event in New York.
Unlike the November 2011 lawsuit, the UFC is the only plaintiff. The UFC focuses on the claim that the New York law, the Combative Sport Law (“CSL”), violates due process rights as it is unconstitutionally vague as to its application.
The UFC points out that the CSL exempts “martial arts” from its ban stating that “martial arts shall include any professional match or exhibition sanctioned by any” of the organizations listed in the statute.
It notes in the Complaint that “standing,” the right to bring an action in the court, “could not be clearer.” This directly addresses the previous lawsuit in which Judge Wood determined that there was no standing due to the fact that the UFC had not suffered injury and did not contact a promoter to hold an event in New York. In its Complaint, it now states that it is working with WKA.
Based on setting a UFC event for April 2016, the UFC states that it will lose “millions of dollars in ticket sales.” It also will lose a source of marketing for its UFC-branded gyms in New York, as well as for the DVDs, consumer products, video games and other products that it sells.
Notably, the UFC indicates that it has “lost sponsorships and has suffered reputational damage around the world because of its inability to hold professional MMA events in New York.” It will be interesting to see what evidence it may bring to prove these allegations if it comes to that point.
The UFC Complaint cites the differences from the beginnings of the CSL indicating that the legislature was concerned with “no-holds-barred fighting.” In her opinion Judge Wood states “MMA has changed substantially since the Ban was enacted.” This provides some guidance as to what a court may decide with respect to the CSL.
It’s clear that the roadmap was provided by Judge Wood for this lawsuit with the exception that it has filed the lawsuit in federal court as opposed to state court as suggested in her opinion. The lawsuit is premised upon the determination by the prior court as this filing is tighter and a shorter (only 37 pages as opposed to 100 plus pages) complaint. It appears that there is a better chance for the UFC in this lawsuit although you should expect stiff opposition from New York. The state will likely argue what it did in the prior lawsuit which is that laws need not change over time. And despite the change within the sport of MMA, it will focus on the intent of the law with its primary purpose to ban MMA.
September 30, 2015
The UFC filed its motion for preliminary injunction on Tuesday. It argues that the UFC is likely to prevail on its claim and should be granted the injunction to hold its event at Madison Square Garden this April. Notably, it has already spent a non-refundable $25,000 for the anticipated event in April.
No hearing date has been set and we’ll likely see opposition from New York.
Similar to its complaint filed on Monday, it stresses the contention that the statute banning professional MMA in the state is inherently vague.
“Much of the law’s problems stem from its failure to explain with any reasonable degree of clarity what exactly a “combative sport” is,” reads the moving papers submitted by the UFC. “Rather than define the term expressly, the statue attempts to reverse engineer a definition by exempting from its prohibitions certain sports, including “martial arts.””
Again the UFC stresses its belief that any issues on standing are now answered: “Whatever uncertainty may have existed on the matter in the past, it is now crystal clear that the estate interprets the law to prohibit Plaintiff from doing so.”
The UFC utilizes deposition from the Jones v. Schneiderman lawsuit to provide evidence that even NY officials provided contrary testimony to how they interpreted the statute.
In addition, the UFC notes that it has contracted with the World Kickboxing Organization, an “exempt organization” allowed to hold events in the states. The motion states, “To eliminate any potential concerns about the imminence of its injury, Plaintiff has contracted to host a live professional MMA event sanctioned by an Exempt Organization.”
It also indicates that it has committed $25,000 as a non-refundable deposit and stands to lose millions of dollars in ticket sales and media revenue.
As we’ve learned from previous injunction requests in MMA, there are hurdles the injunction-seeker must prove that “the probability of his prevailing is better than fifty percent.”
- “a likelihood of success on the merits [of the lawsuit],”’
- That it will suffer “irreparable harm” with a preliminary injunction, and
- “that a preliminary injunction is in the public interest.”
We should also note that the UFC also challenges NY Liquor Law as it did in the November 2011 lawsuit as that law mirrors the Combative Sports Law (or “CSL” as it is referred to in the pleadings).
This will be an interesting, and an important injunction for the UFC in its fight to hold an event in New York. I believe that the first element, “likelihood of success on the merits,” is the biggest hurdle for the UFC. Obviously, the monetary investment in holding an event reflects the “irreparable harm.” You can argue the “public interest” element. Despite the ban, and the inability to get a law passed in Albany to legalize MMA, there is still a lot of support for the sport in the state. The “likelihood of success” could be a toss-up and based on the court’s interpretation of the CSL ban.