Bellator MMA files lawsuit against Rampage

March 2, 2015

Bellator MMA has filed a lawsuit today in New Jersey against Quentin “Rampage” Jackson for breach of contract. The organization is also seeking an injunction to prevent Jackson from appearing in the UFC.

Jackson is scheduled to fight at UFC 186 against Fabio Maldonado on April 24th. It appears that today’s lawsuit and request for an injunction will seek to preclude Jackson from appearing on that card unless something can be worked out between Bellator, Jackson and likely the UFC.

Bellator issued the following release:

Today, Bellator MMA was compelled to go to court to stop Quinton “Rampage” Jackson from fighting in an April 25th bout promoted by Bellator’s competitor, Ultimate Fighting Championship (UFC).  Jackson, who has completed only three fights of his exclusive six-fight contract with Bellator, is barred by contract from fighting for any promoter other than Bellator. Our lawsuit for an injunction and related relief – filed in the Chancery Division of the Superior Court in Burlington County, New Jersey – will compel Jackson to honor his contractual agreement.   We look forward to having one of our MMA stars fighting for Bellator again.

This lawsuit had been brewing for a while after Jackson left the Viacom-owned company late last year and indicated that he had conferred with UFC lawyers and “an outside law firm” to determine if he could legitimately leave Bellator. Jackson’s story is that Bellator did not live up to his Bellator contract, Jackson gave Bellator time to cure the issues he had, but the company did not satisfy Jackson’s concerns so he decided to leave.  What may be an interesting detail here is that Jackson’s management views the contract he signed with Bellator (under Bjorn Rebney) as an entertainment contract rather than a pure sports contract.  This may come into play, as well as the fact that the contract was signed in California.  But that is speculation at this point.

Although Bellator MMA is headquartered in Irvine, California and Jackson lives in Irvine, the lawsuit is filed in New Jersey.

As you recall, Bellator prevailed against Eddie Alvarez when Alvarez sought an injunction against the organization in their contractual dispute. The lawsuit was venued in the U.S. District Court of New Jersey.

Payout Perspective:

Timing is everything when filing lawsuits as we recently wrote about. It was clear that there was going to be a legal issue when Jackson left Bellator to sign with the UFC. The timing of the filing and injunction comes close to UFC 186 and might mean that Jackson will be pulled from the card. The interesting issue here is that the UFC will be implicated here and its clear based on its actions that it thinks it had solid legal grounds to sign Rampage and actively promote him for his fight.

MMA Payout will keep you posted.

Zuffa files Motion to Dismiss in Antitrust lawsuits

March 1, 2015

The end of the week and the end of the month are always prime dates to zing your opposing counsel with motions.  On Friday, February 27th, Zuffa filed a Motion to Dismiss the four identical Antitrust Complaints filed by former UFC fighters in federal court in San Jose.  The hearing date will not be until July 23rd.

There is a looming Motion to Transfer Venue to be decided by the court that could cause the case to be move to Las Vegas and this motion to be heard before another Judge.  In the meantime, Zuffa’s lawyers have filed this Complaint seeking to dismiss the plaintiffs’ claims citing they fail to state any legal claim against the UFC.

The UFC has issued an official statement on its motion to dismiss here.

A portion of the statement reads:

While UFC vigorously contests the plaintiffs’ characterization of the facts, a court deciding a motion to dismiss generally must accept the allegations as true. Even with that high legal standard, UFC’s motion demonstrates that UFC competed in lawful ways that helped fighters and built UFC into a premiere organization in the sport of Mixed Martial Arts.

The UFC treats its fighters well, compensates them fairly, competes against other MMA promoters, and produces a product that is enjoyed by millions of fans around the world. We are confident in our legal position and expect to ultimately win this lawsuit.

As for the actual motion, Zuffa argues that the Plaintiffs have failed to state a claim per the standards set forth under two recently decided U.S. Supreme Court cases.  In Bell Atlantic Corp.. v. Twombly (2007) and Ashcroft v. Iqbal (2009), the U.S. Supreme Court heightened the pleading requirement for Federal civil cases.  The rules require that plaintiffs include enough facts in its complaint to make it plausible that they will be able to prove facts to support its claims.

The Twombly case is relevant here since it was an Antitrust case in which the court dismissed Plaintiffs Complaint citing that the pleading did not allege sufficient facts for the court to determine that there was anti-competitive behavior in violation of the Sherman Antitrust Act.  Iqbal reaffirmed the test announced in Twombly which was that a federal complaint may be dismissed if the court can “identify and disregard naked assertions and conclusory allegations, and then determine where the factual context presented by the remaining specific allegations plausibly suggest the defendant is liable under the relevant law.”

What this all means is that Zuffa is claiming that the Complaint(s) do not have sufficient facts to prove its claim that Zuffa violated Antitrust laws.  While we will not go into the specifics of the motion, it is meticulous in going through plaintiffs’ Complaint and identifying each paragraph in which it believes it is mere allegations and/or conclusory statement.

Payout Perspective:

This appears to be standard litigation playbook stuff from Zuffa.  First, it filed a motion to transfer venue seeking to move the case to Las Vegas.  Instead of responding to the Complaint in affirming or denying the allegations, it has filed a motion to dismiss.  There are at least three things that might occur from this filing.  First, the plaintiffs may amend its Complaint to be more specific in its allegations.  Second, the plaintiffs may refile its Complaint so that it conforms to the rules (i.e., provide more specific facts of its allegations).  Or, respond to the Motion to Dismiss.  The legal requirements for filing Complaints in federal court differ due to the Supreme Court cases.  Essentially, the federal rules are stricter than lawsuits filed in state courts (in state courts pleadings can allege “Upon information and belief…”, but you can’t get away with that in federal courts) due to the case law which seem to require more factual detail in allegations.  Obviously, there is risk in providing specific details in Complaints.  If the factual allegation proves not to be true or cannot be proven, you will have the allegation dismissed or end up losing.

MMA Payout will keep you posted on these developments.

Report: Silva will argue alibi to using PEDs

March 1, 2015

While most of us were watching UFC 184 on Saturday, the UFC posted a response to a Brazilian report that Anderson Silva will admit to taking PEDs leading up to UFC 183.  Silva is mounting a defense which he claims his usage of PEDs was “therapeutic” and thus mitigates his wrongdoing.

The Brazilian website UOL states that Silva’s team is preparing a defense which claims that he took several banned substances but they were not taken “to gain an advantage on his opponent.”  Presumably, they will argue that the use of the banned substances, Drostanolone and Androstane were done to help in recovering from his broken leg and that the dosages were minimal so that they would not give him an advantage.

Silva also tested positive for Oxazepam (an anti-anxiety drug) and Temazepam, a sleep deprivation drug.  It’s believed he will claim that these drugs help with recovery from back spasms and muscle pain.

Payout Perspective:

Silva has repeatedly denied reports of his failed drug tests.  Now it appears we get a new strategy.  It’s hard to buy the defense since Silva broke his leg over a year prior to this fight so one might think that he need not be taking these illegal substances leading up to his February 2015 fight when he broke his leg in December 2013.  It’s also hard to excuse the usage of the two other drugs, Oxazepam and Temazepam when you should know that these drugs are banned.  It seems like this defense is being offered to mitigate the eventual punishment for Silva.

From a media standpoint, it’s an interesting placement to bury the news on Saturday night during an event when it probably knew of this information during the week.  It’s hard to remember a time that the UFC has announced news at such an odd time.

UFC 184 attendance, gate and bonuses

March 1, 2015

MMA Junkie reports the attendance, gate and bonuses from UFC 184 held at the Staples Center in Los Angeles, California.  Ronda Rousey led the group of bonus winners for the night.

The event drew a reported 17,654 fans for a gate of $2.675 million according to Dana White at the post-fight press conference.  In comparison to other UFC events at the Staples Center, UFC 60 drew 14,802 (10,347 paid according to Wikipedia) for a gate of $2.9 million. UFC 104 drew 14,892 for a gate of $1.9 million. UFC on Fox 4 drew 16,080 for a gate of $1.1 million.

The capacity at the Staples ranges from 18,000-21,000 depending on event.

Ronda Rousey, Jake Ellenberger, Tony Ferguson and Tim Means all picked up $50,000 Performance of the Night Bonuses with their finishes on Saturday night.

Payout Perspective:

Certainly there could have been other fighters that could have received the $50,000.  Roan Carneiro and Derrick Lewis come to mind.  As for the attendance and gate, it was the biggest attendance for an event at Staples although the number of comps is never reported.  The gate was slightly larger for UFC 60 which featured Matt Hughes and Royce Gracie.

Disclosed salaries of UFC 184 fighters

February 28, 2015

MMA Junkie reports the payouts for Saturday’s UFC 184. As reported yesterday, Cat Zingano will make more in show money than women’s bantamweight champion Ronda Rousey.

The salaries were released by the California State Athletic Commission and obtained by Junkie:

• Champ Ronda Rousey ($65,000 to show, $65,000 to win) vs. Cat Zingano ($100,000/$100,000) – for women’s bantamweight title

• Holly Holm ($25,000/$25,000) vs. Raquel Pennington ($10,000/$10,000)

• Jake Ellenberger ($68,000/$68,000) vs. Josh Koscheck ($78,000/$78,000)

• Alan Jouban ($10,000/$10,000) vs. Richard Walsh ($8,000/$8,000)

• Tony Ferguson ($24,000/$24,000) vs. Gleison Tibau ($50,000/$50,000)

• Roan Carneiro ($12,000/$12,000) vs. Mark Munoz ($47,000/$47,000)

• Roman Salazar ($8,000/$8,000) vs. Norifumi Yamamoto ($15,000/$15,000)

• Dhiego Lima ($10,000/$10,000) vs. Tim Means ($17,000/$17,000)

• Derrick Lewis ($15,000/$15,000) vs. Ruan Potts ($10,000/$10,000)

• James Krause ($15,000/$15,000) vs. Valmir Lazaro ($8,000/$8,000)

• Masio Fullen ($8,000/$8,000) vs. Alexander Torres ($8,000/$8,000)

Payout Perspective:

Rousey will make more with her cut of the PPV and it is reported that she should make at least $1 million for her title defense on Saturday. As for the rest of the card, Holly Holm debuts with a $25K/$25K deal. Aside from Zingano and Rousey, Josh Koschek ($78K/$78K) and Jake Ellenberger ($68K/$68K) are the other high-paid fighters on Saturday’s card.

Cat to make $100K/$100K, Rousey $65K/$65K at UFC 184

February 27, 2015

Lance Pugmire of the LA Times tweeted that Ronda Rousey will be making less of a guaranteed purse than Cat Zingano at UFC 184. However, with her PPV cut and deals with official UFC sponsors, Rousey will clear $1 million on Saturday.

According to tweets from Pugmire, Rousey will make $65K to show and $65K to win. The challenger will get $100,000 to show plus $100,000 if she wins. There is no information on whether Zingano gets a PPV cut. However, Rousey is said to have a PPV cut which should get her over $1 million.

As many probably saw at the weigh-ins, this will be the first fight that Rousey will don Reebok. She received an individual deal from the soon-to-be official clothing sponsor of the UFC. In the past, she also has had deals with official UFC sponsors Monster Headphones and MetroPCS.

Payout Perspective:

Zingano will make more than 5x what she made at UFC 178 when she earned $9K and $9K against Amanda Nunes. Thus, last September she was only guaranteed $9,000. Just 5 months later she will be guaranteed more than 10 times that amount. So, no lockstep raises for Cat. Good for her.

It’s interesting to note that Rousey last made $120K to show plus a $50K win bonus over Alexis Davis at UFC 175 this past July. It appears to be a restructure of her pay here so that she will receive more from either sponsors and/or her PPV cut.

Koscheck gives opinion on fighter union

February 27, 2015

During the press functions leading up to UFC 184 this Saturday, MMA Fighting’s Ariel Helwani interviewed Josh Koscheck.  He indicated that there should be a fighter’s union.

“There’s no 401K at the end of the day,” said Koscheck during the interview.  Koscheck, recognizing the end of his fight career is near, gave his perspective on what young fighters should do to prepare for their future and “residual income.”

Koscheck would not give specifics on when and if he would want to be involved in putting together a union, but indicated that a union would make the sport grow.  He also gave his opinion that UFC contracted fighters are employees and not independent contractors as they are currently classified.

Payout Perspective:

Just another perspective about fighters’ rights coming from a fighter that nears the end of his career.  It doesn’t seem that Koscheck wants to become involved in organizing a union in the UFC although he is not opposed to one being set up.  Koscheck seems like he has invested his fight earnings and is moving on to his post-fight career with business interests outside the octagon.

Slice-Shamrock scheduled for June Bellator MMA event on Spike TV

February 26, 2015

MMA Junkie reports that Kevin “Kimbo Slice” Ferguson will finally meet Ken Shamrock as part of a Bellator card slated for June 20th at the Scottrade Center in St. Louis.  The show will headline a Spike TV televised main card.

As MMA Junkie points out, the Bellator event will take place on the same day as UFC Fight Night 69 in Berlin.  The UFC event looks to be a Fight Pass only card.

Slice signed with Bellator MMA last month.  The 41 year old has not fought in MMA since his loss to Matt Mitrone in 2010.

Kimbo Slice-Ken Shamrock was the main event on an EliteXC card on CBS back in 2008.  MMA fans may recall that Shamrock was a late scratch and replaced by Seth Petruzelli.  Slice was knocked out by Petruzelli in the first round and the reputation of Kimbo took a big hit.

Payout Persepctive:

It will be interesting to see how the Missouri Athletic Commission deals with this fight as Slice is in his 40s and has not fought in 5 years.  Shamrock is 51 and although he was scheduled to fight in a bare knuckle match in April, he last had an MMA fight in November 2010.  The booking falls in line with Bellator’s “tent pole” events.  We saw this last November with Ortiz-Bonnar.  It was a ratings success.  Slice-Shamrock should provide the same.  Slice has been a ratings draw and Bellator is hoping that he still is.

WWE-Lesnar contract negotiations stall

February 26, 2015

Dave Meltzer of MMA Fighting reports that Brock Lesnar and the WWE have stalled in negotiations on a new contract.  The former UFC heavyweight champ could be heading back to MMA with either Bellator or the UFC.

Lesnar was advertised to appear on this week’s WWE Raw on Monday but never appeared despite being at the arena.  Meltzer’s sources indicated that the no-show was due to an impasse on a new contract.  It was described as “resolvable, but not yet resolved.”

Lesnar has 4 appearances left with the WWE before his contract expires.  The WWE would like to extend his contract prior to it ending at this year’s Wrestlemania in March.

Despite being 38 years old, Lesnar would be welcomed back to MMA by the UFC or Bellator.

Payout Perspective:

It’s interesting that despite his previous injuries and age, Lesnar would command a bidding war.  One would think that based on the contract impasse with the WWE, that Lensar has some leverage as the UFC and perhaps Bellator would be interested in signing the former UFC heavyweight champion.  Despite his short stint with the UFC, Lesnar was a major PPV draw and despite his layoff, his return would likely be a big event.  One would think that the UFC would be willing to spend the money on Lesnar as it is in need of PPV needle-movers.  Also, Bellator might be a destination under the new Scott Coker regime.

UFC-DraftKings announce sponsorship deal

February 25, 2015

The Sports Business Daily reports that fantasy sports operator DraftKings has signed an exclusive partnership with the UFC.  The deal, which was rumored to occur earlier this month now makes DraftKings an official sponsor of the UFC.

The deal will include “offline and online branding assets for DraftKings” including “in-octagon signage” (which we’ve already seen) at UFC events.  One of the notable elements of the partnership is the unique UFC prizes for DraftKings players which include “trips to events, VIP experiences” with Dana White and “fighter meet-and-greets.”

Although the article indicates that daily fantasy MMA games lag behind football or basketball there’s promise that it may grow.

The UFC becomes one of several league partnerships for DraftKings which includes Major League Baseball, NHL, the Breeders’ Cup and the World Series of Poker.  It also has individual team deals with various NFL, NHL and NBA teams.

The deal was brought together by venture capital firm The Raine Group, an investor in the Boston-based fantasy operator.  It was at an investor conference earlier this month where it was reported that the deal appeared imminent.

This past December, DraftKings announced a deal with Jon Jones and the launch of Fantasy MMA on its site.

Payout Perspective:

The deal is done and makes sense considering the fantasy sports industry is booming right now.  With the UFC’s roots in the gaming industry, it was just a matter of time before this sponsorship was finalized.  It will be interesting to see if DraftKings will seek out individual MMA fighters for sponsorship opportunities.

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