TUF 21 Episode 4 draws 286,000 viewers

May 18, 2015

The Ultimate Fighter 21 Episode 4 drew just 286,000 viewers on FS1 this past Wednesday.  It’s the lowest rating this season for the show.

TUF 21

Episode 1 – 490,000 live + Same Day

Episode 2 – 454,000

Episode 3 – 364,000

Episode 4 – 286,000

TUF 21 Ep 4

The TUF 21 early average sits at a lowly 399,000 viewers.

Payout Perspective:

A game 7 in the NHL between Washington-New York and two NBA playoff series likely spelled the poor ratings for the first showing of TUF 21.  It’s clear that the focus for the network is that series does well overall (i.e., focus on DVR ratings) rather than look at the Wednesday night ratings.  The concern for FS1 is that while it may pick up almost 50% viewership from its Live +SD average, it still is lower than the past seasons airing on the network.

W Silva wins reversal and remand of NSAC ban, fine

May 18, 2015

ESPN.com reports that a Nevada state district court judge has reversed and remanded the Nevada State Athletic Commission’s lifetime ban and $70,000 fine issued against Wanderlei Silva last year.  Judge Kerry L. Earley determined that while the NSAC had jurisdiction over Silva, the punishment was “arbitrary, capricious and not supported by substantial evidence.”

Judge Earley’s decision orders a new hearing by the commission to find a proper punishment for Silva’s violation of evading a random drug test in lead-up to his fight against Chael Sonnen at UFC 175.

The court indicated that a decision would be handed out by May 11th but the decision came a week later.

According to the ruling (as reported by ESPN, we will attempt obtain a copy), the court agreed with the NSAC’s argument that it had jurisdiction over Silva but not with the method the commission determined the penalty. If you watched the commission hearing, you may recall that there was an ad hoc moment where the commission determined a penalty based on what they knew of Silva’s pay.

Silva’s attorney, Ross Goodman, applauded the reversal of the suspension and the re-hearing but may consider an appeal of the ruling with respect to jurisdiction.

As a quick procedural background as to how the decision made its way to state superior court, as in many jurisdictions, the process for appeal of an administrative decision is to the state court.

Payout Perspective:

While I believed that the court may have found jurisdiction, Goodman’s potential appeal may not be as far-fetched as you might think.  The ruling means that we should see the commission re-evaluate Silva’s penalty.  It’s unlikely it will be able to impose the recommended guidelines it passed last Friday although one might surmise the commission will have this in the back of their minds.  Ironically, the NSAC discussed not wanting its decision to be overturned at the hearing (and cited in Silva’s petition for judicial review) for being “outside of the norm” of what the commission has done in the past.  It looks like the court has found it did overreach with its penalty.

Gegard Mousasi signs deal with Bridgestone tires

May 17, 2015

MMA Junkie reports Gegard Mousasi announced a new sponsorship with Bridgestone tires as a brand ambassador. He wore the brand on his shorts Saturday against Costas Philippou.

The Japanese tire manufacturer announced the deal prior to Mousasi’s fight on Saturday at UFC Fight Night 66.  He becomes the brand’s first MMA ambassador.

Recently, Mousasi has had sponsorship issues as he sued Fear the Fighter for unpaid sponsorship money.

Payout Perspective:

The announcement occurs at a time when most sponsors of fighters in the UFC are leaving due to the impending Reebok deal.  With the signing, it means that Bridgestone will utilize Mousasi outside of any of his fights while in the UFC as fighters can still have sponsors but cannot wear them during the promotion of a fight or on fight night.  We will see how Bridgestone uses Mousasi and what leverage it can gain without the aid of the UFC.  One might expect more international ads with Mousasi as he is not well-known in the U.S.

UFC Fight Night 66 attendance and bonuses

May 17, 2015

MMA Junkie reports the attendance and bonuses from Saturday’s UFC Fight Night 66 from Pasay, Philippines.  The long-awaited company debut in the Philippines drew a sold-out crowd.

Jon Delos Reyes, Roldan Sangcha-an, Neil Magny and Jon Tuck earned $50,000 bonuses.  Fight of the Night honors went to Reyes and Sangcha-an while Magny and Tuck received “Performance of the Night.”

The event drew 13,446 from the SM Mall of Asia Arena. The arena serves as a basketball arena most of the time and has a capacity of 16,000-20,000.

Payout Perspective:

Returning from the east coast so that is the reason this info comes a little late.  A rare bonus for a UFC Fight Pass Prelims fight which is good for the fighters.  The attendance was reported as a sell-out so one might guess that the configuration capacity for the UFC was just over 13,000.

NSAC issues stiffer penalties for drug test failures

May 15, 2015

On Friday, the Nevada State Athletic Commission passed new drug testing measures which include enhanced punishments for test violations.  The NSAC hopes that other state regulators follow suit.

UPDATED: 4:07pm ET – MMA Junkie has a write-up on today’s hearing.  One note is that the commission rulings are not mandatory and punishments will be handled on a case-by-case basis.

In addition to the increased penalties, it is now changing its rule that fighters that fail a post-fight drug test will now be credited with a loss instead of a no contest.

Per ESPN’s Brett Okammoto, a first offense would command more of a penalty regarding suspension and percentage of purse.

Notably, the first offense suspension for marijuana usage is more than the use of diuretics.  Also, steroid use would command a 3 year ban and a fine of 50-70% of the purse.

The new penalties will go into effect on September 1st in the state.   MMA Fighting’s Shaheen Al-Shatti indicated that the commission voted to shift diuretics and stimulants from the ‘in competition’ prohibited list to the ‘always prohibited’ list.  Brett Okamoto also indicated that the commission will discuss whether the NSAC should continue to follow WADA’s testing and tolerance levels of cannabis

Payout Perspective:

The NSAC’s moves on Friday is a step in the right direction with respect to addressing illegal drug use.  It should help clean up the sport of MMA, at least in the state of Nevada.  Certainly, the harsher penalties for marijuana use will be criticized as the perspective of the drug has changed over the years.  We shall see how these new policy changes will influence other commissions to adopt the penalties issued by the NSAC.

Report: Buy rates for UFC 185 and UFC 186

May 14, 2015

The Wrestling Observer (subscription recommended) reports the PPV estimated buy rates for the last two UFC events.  UFC 185 drew 275,000 while the much-maligned UFC 186 garnered somewhere between 100,000-125,000 buys.  It also updates the estimate for UFC 184.

The PPV estimates are based on information obtained from Dave Meltzer.  UFC 185 featured two title fights with Rafael dos Anjos winning the lightweight title from Anthony Pettis and Joanna Jedrzejczyk’s victory over Carla Esparza for the women’s strawweight title.  Yet, it failed to break 300,000 PPV buys.

Most expected the poor PPV buys for UFC 186 so the 100,000-125,000 PPV buy rate estimate seems appropriate and might even be better than anticipated.  It’s the second time that Demetrious Johnson has main evented a PPV with such low PPV buy rates.  His fight at UFC 174 against Ali Bagauitinov mustered just 115,000 PPV buys.  UFC 186, taking place in Montreal, was hindered by the cancellations of the rematch between TJ Dillashaw and Renao Barao and then the Rory MacDonald-Hector Lombard fight was called off.  On top of that, there was the removal of Rampage Jackson from the card only to be added back onto the card after a trial court’s injunction was overturned by a New Jersey appellate court during fight week.   UFC 185 featured Demetrious Johnson taking on Kyoji Horiguchi.

On the bright side, UFC 184 PPV featuring Ronda Rousey’s quick tapout of Cat Zingano is up to 590,000 buys.

Below are the PPV buy rate estimates this year so far:

UFC 185

Payout Perspective:

While the UFC had a great first quarter of PPVs, it has produced two shows that many believe underperformed and/or underwhelmed.  Even with two title fights and hometown favorite Johny Hendricks on the UFC 184 card, it still did not produce on PPV.  UFC 185 was expected to draw low PPV numbers based on the constant shuffling on the card and the stark reality that Johnson just does not draw PPV buys.  We should see a bounce back with next week’s UFC 187.  Even without Jon Jones, we should see a decent buy rate with Weidman-Belfort and Cormier-Johnson heading the card.

FTC reopens investigation on Zuffa business practices

May 14, 2015

MMA Junkie reports that the Federal Trade Commission has reopened its investigation against Zuffa and has contacted people within the MMA industry about Zuffa’s business practices.

The government investigation occurred after Zuffa acquired Strikeforce.  The agency evaluated Zuffa’s financial documents and talked to UFC execs but the investigation yielded nothing to command a further inquiry at the time.  The FTC closed its investigation of Zuffa in early 2012.  MMA Payout’s FOIA request for documents related to that investigative led to nothing of substance except for a couple form letters which indicated that it “reserved the right to reopen the investigation if it deemed it necessary.”

It appears that it was necessary.

With the filing of the antitrust lawsuit by former UFC fighters, it appears that the FTC will take another look at Zuffa business practices.

The news comes out a day after Zuffa filed a motion to stay discovery pending its Motion to Dismiss plaintiffs’ complaint.

Payout Perspective:

The reopening of the investigation may help plaintiffs in its position that its complaint is valid.  It also will help with opposing Zuffa’s motion to stay discovery.  The FTC investigation may help plaintiffs with the argument that Zuffa’s financial documents are relevant to the litigation as you might expect an anticipated discovery fight over that information.  While the investigation by the FTC and the antitrust lawsuit are independent of one another it is clear that you might infer a tie-in between the two.  We will see how both lawsuit and government investigation proceed.

Zuffa files motion to delay discovery in antitrust lawsuit

May 13, 2015

Zuffa has filed a Motion to Stay Discovery in the antitrust lawsuit filed by former UFC fighters.  According to the papers filed Wednesday, Zuffa requests that discovery is halted until the court addresses Zuffa’s Motion to Dismiss and Motion to Transfer Venue.

The Motion to Stay Discovery is set to be heard by the Honorable Edward J. Davila on September 10, 2015 in U.S. District Court in San Jose.

Essentially, Zuffa states that the discovery process is costly and burdensome and that it should not have to start the process until the court determines its Motion to Dismiss which shall be heard on July 23rd.  Alternatively, it argues that discovery should be pending until the court decides the Motion to Transfer Venue (oral argument was heard May 7th).

According to the filing, plaintiffs’ counsel and Zuffa’s counsel met and conferred on April 15th to determine a pretrial plan for the case.  You can see the results here.  The parties agreed to mediation to occur no later than September 30, 2015.  However, the parties disagreed as to whether discovery should commence.  Plaintiffs sent Zuffa 59 Requests for Production of Documents on April 26th per Zuffa’s Motion to Stay.  The parties have exchanged its preliminary witnesses on May 8th.

Per the Motion to Stay Discovery, Zuffa argues that its Motion to Dismiss would resolve all issues if the Court grants the motion.  Thus, discovery would be a moot point.  It argues that it should not have to begin working on discovery that it describes as “extensive, burdensome and costly.”  The requests appear to seek a voluminous amount of financial information from Zuffa.  It also seeks a broad amount of information.

The Motion refers to a two-step test used by federal courts in California for evaluating a request for stay during the pendency of a dispositive motion (i.e., Motion to Dismiss).  First, the pending motion must dismiss the entire case (or the issue in which discovery is aimed).  Second, whether the court may determine the motion without the discovery.  Zuffa states the court can dismiss the case without the need for conducting discovery.

Here, Zuffa obviously is seeking to dismiss the entire case.  In addressing the second part of the above test, Zuffa states that since Plaintiffs’ claims rely on Zuffa’s contracts, it argues that those are in the hands of the plaintiffs already and there is no need for discovery.  It also states that the financial information sought in its requests are not needed before Zuffa’s Motion to Dismiss.

Payout Perspective:

And so begins the discovery fight that occurs in almost every civil lawsuit.  You can see that Zuffa does not want to do unnecessary work it believes is extensive and costly while at the same time provide plaintiffs with the type of information that may allow them to amend their Complaint.  Plaintiffs believe that they have a right to start the litigation process and the stay is merely a stall tactic so that Zuffa does not have to hand over financial information that may fall into the public eye.  As someone that has been on both sides of the discovery fight, this is a close call for the court.  While plaintiffs want this case to move expeditiously and believe that they have a right to discovery, Zuffa believes it would be unnecessary to conduct discovery if the court dismisses the case.

Whatever the ruling, you can expect a fight over Zuffa financial documents and whether or not the requests are overbroad, relevant and/or necessary with respect to the current lawsuit.

MMA prospect chooses Bellator over UFC

May 13, 2015

Penn State collegiate wrestler Ed Ruth has signed with Bellator.  A reason that the MMA prospect decided to go with the Viacom-owned company instead of the UFC is due to the recent changes in sponsorship policy.

Ruth told Tristen Critchfield of Sherdog he felt that he could obtain more sponsorship money than the entry level $2,500 he would receive with the UFC.

In a recent interview, Scott Coker was neutral about the UFC-Reebok sponsorship deal and the pay tiers even though he acknowledged that he’s been contacted by UFC fighters and managers about Bellator’s sponsorship policy.  The announcement of the Reebok sponsors pay tiers have caused many to criticize the new structure and UFC fight managers have called a meeting to discuss the business of the sport as a result.

Ruth is a 3-time NCAA champion and a prime candidate for the 2016 Olympics per Bloody Elbow.  He served as Jon Jones’ training partner leading up to UFC 182.

Payout Perspective:

There’s no public certainty that the UFC was actively recruiting Ruth so we do not know if there was some sort of bidding war for his services.  Still, this is a good prospect acquisition by Bellator as it has done this in the past with amateur wrestlers Aaron Pico and Bubba Jenkins.  However, the additional news that Ruth chose Bellator over the UFC due to the new sponsorship policy brings up the question of whether more fighters will consider Bellator over the UFC.  The other question is whether sponsors will pay the same in Bellator as it has done in the UFC.  The fact remains that reported Bellator pay is lower than UFC pay.  If Ruth believes he can make up that monetary disparity through sponsors, then the risk is worth it.  Ruth alluded to the fact that based on his background, he can make more with sponsors than just the initial $2,500.  One might suspect that his amateur wrestling ties may help with obtaining sponsors.

UFC fight managers set to meet next week

May 13, 2015

MMA Fighting reports on an upcoming meeting among UFC fight managers to discuss the business of the sport in light of the upcoming changes to the company’s sponsorship policy.  With the release of the Reebok pay tiers, it’s clear that managers and their fighters are concerned.

The meeting will occur before UFC 187 which takes place in Las Vegas.  It is being put together by MMA managers Mike Roberts and Jeff Meyer of MMA, Inc.  While no agenda has been revealed to the public, it’s clear that the Reebok deal will be a central focus of the discussion.

UFC fighters’ opinions on the Reebok deal have been split after the money figures were disclosed.  Certainly, the negative opinions of the deal on social media by many have received the most notoriety.

Payout Perspective:

One might surmise that a reason this meeting is set to take place is to determine the future of the MMA manager in the UFC.  It’s clear that eliminating sponsors in July negates one of the main tasks of the manager.  While there are other ways that a manager may be of service to a fighter, obtaining sponsors is key.  One has to wonder how many managers (and fighters) show up at the meeting.  Also, what will come out of this meeting?  Will there be a unified request to the UFC to ask for a reconsideration of the sponsor pay schedule like the UFC amended its sponsor pay model?  We will see.

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