Silver steps down as NY State Assembly Speaker

January 28, 2015

NY Times reports that Sheldon Silver will be replaced as speaker of the NY State Assembly and Assemblyman Joseph Morelle will become the interim speaker starting next week.  Notably, Morelle sponsored a bill that would legalize professional mixed martial arts in the state.

Notably, in the first half of January 2013, records show that Zuffa contributed $2,500 to the re-election campaign of Assemblyman Joe Morelle.  Zuffa also contributed the same amount to Joe Griffo, another New York state senator that, along with Morelle, has sponsored a bill to legalize the sport in the state.

Morelle, who is the majority leader of the state Assembly, will be one of several lawmakers vying for the permanent role of speaker.  According to Jim Genia, Morelle, Assemblyman Keith Wright, Assemblyman Joe Lentol, Assemblyman Denny Farrell and Assemblywoman Cathy Nolan are candidates for Silver’s former position.  Per Genia, Assemblywoman Nolan is the only one to come out against the sport.  The NY Times also names Assemblyman Carl Heastie as a possible contender for the speaker positions as well.  According to a report, Zuffa donated $500 to Heastie in 2013.

Payout Perspective:

The Assembly plans to elect its permanent speaker on February 10th.  The prospects look good that New York may get a speaker that has supported MMA in the past.  While this does not necessarily mean that the speaker will be able to get a law passed legalizing MMA, if a pro-MMA assembly person becomes speaker, there should not be an issue with getting a vote on a bill legalizing MMA in the state.

NYS Assembly Speaker Silver arrested on corruption charges

January 22, 2015

New York State Assembly speaker Sheldon Silver was arrested on federal corruption charges on Thursday.  The charges include mail fraud, wire fraud and extortion.  In MMA circles, the state assemblyman had been the one that prevented a vote on the legalization of MMA in the state.

The Complaint obtained by the NY Times alleges that Silver has received “more than $6 million in outside income from two law firms since late 2002.”  This includes “undisclosed bribes and kickbacks” where Silver used his position and power to “induce real estate developers with business before the State to retain and continue to use a Real Estate Law Firm controlled by an attorney who previously had worked as Silver’s counsel in the Assembly and who caused Silver to be paid for such referrals by the Real Estate Law Firm,” reads the Complaint.

UFC head Dana White has accused Silver of blocking a vote which could potentially grant the legalization of professional MMA in the state.  New York is the only state which prohibits professional MMA.

Silver had served as speaker for more than two decades.  So far, there is no clear indication as to who Silver’s successor would be.

A lawsuit is pending in which Zuffa has sued the state for its legislative ban on professional MMA.

Payout Perspective:

The news of Sheldon’s arrest could breathe new life into the annual Zuffa lobbying activities in Albany this spring.  While Sheldon’s removal from his position may not mean that New York passes legislation legalizing professional MMA in the state, it gives lobbyists new hope that they can obtain a vote in the Assembly.  This story is just getting started and MMA Payout will keep you posted.

Wanderlei Silva sues NSAC seeking reversal of lifetime ban, fine

January 20, 2015

MMA Fighting reports that Wanderlei Silva has filed a lawsuit against the Nevada State Athletic Commission.  Silva claims that the commission overstepped its boundaries in issuing him a lifetime ban last year.

In addition to the ban, the NSAC issued a $70,000 fine this past September.  The punishment arose out of his failure to take a drug test in lead-up to a fight with Chael Sonnen this past July.  As we know, the fight never happened.

“This case encapsulates agency aggrandizement at its worst where disciplinary ation was taken against a non-licensed person,” reads the introduction of Silva’s Complaint filed by Ross Goodman in Clark County, Nevada’ District Court.

Silva’s attorney argues that the NSAC did not have jurisdiction over Silva since he was not licensed in the state of Nevada at the time officials attempted to drug test Silva.  Silva’s attorney claims that the statutes which the NSAC must follow only pertain to a “licensee.”

Silva is looking for the NSAC ruling to be reversed and set aside which could the clear pathway for Silva to fight in Nevada again.

Goodman is familiar with combatting the NSAC.  In April 2012, he sued the NSAC on behalf of Nick Diaz.

W. Silva v. Bennett and NSAC

Court filing via MMA Fighting.

Payout Perspective:

As we indicated in December, the process for appeal of an administrative ruling is usually through filing a lawsuit seeking a “petition for review.” Still, we wonder why Silva is going through this legal process when he could work around the suspension in Nevada and still fight. Silva’s attorney makes an interesting legal argument based on the Nevada statutes which the commission must follow. We will see how the judicial system handles interpretation of these statutes and this case.

NSAC calls Jones’ testing “administrative oversight”

January 7, 2015

MMA Fighting reports further on the Jon Jones drug test and how the news of his positive test came to light.  The Nevada State Athletic Commission remains a little vague on the reasons it tested Jones for a recreational drug not banned outside of competition.

Bob Bennett on why Jones was tested for a recreational drug via MMA Fighting:

“That was a bit of an anomaly that will be addressed [at the next NAC hearing on] Jan. 12. It was not a report requested by the NAC. It appears to have been an administrative oversight.”

The NSAC learned of the drug test failure administered on December 4th on December 23rd according to commission chairman Francisco Aguilar.  The results were sent to the UFC “around that day” according to the MMA Fighting article.  Aguilar was not clear when the UFC informed Jones of the test.

Jones took another “out of competition” test on December 18th and passed although he was not tested for cocaine on that day per the article although the below report seems to reveal otherwise.

A public request for Jones’ December 4th test was made which may have precipitated the reveal.

Kevin Iole has tweeted the results:

Payout Perspective:

According to the NSAC, which follows the World Anti-Doping Agency (WADA) code, “in competition” is considered 12 hours before competition and the time needed to collect test samples afterward.  Thus, the NSAC will not punish Jones because his test did not violate the rules of the NAC.  Of course, Jones could be subject to the UFC Code of Conduct.  The UFC “may” impose discipline for Jones’ use of cocaine.  The UFC code is subject to interpretation and it is still is up to the UFC to decide whether or not it may issue discipline.  Per MMA Fighting, the UFC considers Jones’ failed test December 5th a violation of the code of conduct but is considering Jones checking into drug rehabilitation as perhaps a mitigating factor in determining discipline.

There are obvious issues with the drug testing and subsequent revelations by the NSAC.  The first question is why was Jones tested for a drug not banned for “out of competition” use.  Not sure how much will come to light during the NSAC hearing on January 12th but it should provide for some interesting explanations.

14 for 14: No. 8 TRT banned by NAC, UFC and others

December 28, 2014

In February 2014, an investigative report by ESPN on testosterone replacement therapy (TRT) in MMA revealed the practice of fighters utilizing a diagnosis of low testosterone for the usage of synthetic testosterone.

Not surprising, Dana White called out the ESPN report as an embellishment.  He noted that 5 fighters had TRT exemptions out of the “500 guys under contract.”  Still, the UFC issued a ban on the use as well.

It started with the Nevada Athletic Commission in February when it unanimously voted to ban TRT in MMA.  The UFC also decreed a ban.  In addition, other states including California and also Brazil followed suit with a ban on therapeutic use exemptions (TUE) for testosterone replacement therapy (TRT).

If Dan Henderson’s performance against Daniel Cormier at UFC 173 is an indication as to what happens after a fighter (Henderson benefited from the TRT exemption) comes off of TRT, the ban may have an effect on future fights and fighters.

Notably, Vitor Belfort, the next challenger to Chris Weidman’s light heavyweight title benefited from TRT.  ESPN highlighted Belfort in its February expose on the practice.  Belfort withdrew from his title fight against Weidman earlier in the year due to the Nevada ban on TRT.  Belfort chose not to apply for a license for the fight and Lyoto Machida stepped in.

Belfort was awarded a license by Nevada in July provided he would concede to random blood and urine testing.  However, Belfort was only tested once since July to the consternation of Chris Weidman.  His fight against Chris Weidman was moved to California where the CSAC will take over testing of Belfort.

Payout Perspective:

The ban on TRT in MMA was a step in the right direction for the sport in 2014.  It offered legitimacy to the sport as the use of TRT was perceived as cheating by many.  And while the ban may not be fair for a fighter like Antonio “Bigfoot” Silva, it was likely the right move.

UFC supports expansion of legalized sports betting

October 31, 2014

ESPN reports that the UFC, to no surprise, supports the expansion of legalized sports betting in the United States.  UFC exec Lawrence Epstein was quoted as saying that legalized sports betting “will enhance the game as opposed to doing anything to hurt it.”

Epstein also stated to ESPN about the proposed new law allowing sports betting in New Jersey, “[t]o the extent that there’s nothing illegal about taking bets on the UFC in the state of New Jersey, we’d be absolutely fine with it.”  The comments come on the heels of similar support from first year NBA commissioner Adam Silver who believes that sports betting legalization in the U.S. is “inevitable.”

Major sports leagues including the NBA have sued the state of New Jersey and have obtained a temporary restraining order preventing the state’s racetrack, Monmouth Park, from accepting bets on its games.  Of note, U.S. District Judge Michael Shipp wrote in his ruling that the restraining order was not limited to the sport leagues involved in the suit.  Thus, it could prevent taking bets on MMA even though no promotion is currently involved in the litigation.

The lawsuit by the leagues argues that the law passed by Governor Christie, the 2014 Sports Wagering Act, violates the Professional and Amateur Sports Protection Act of 1992 (PAPSA).  PAPSA bans state-sponsored sports betting on all sports except jai alai, pari-mutuel horse and dog racing except in four states:  Oregon, Nevada, Montana and Delaware.  These four states have pre-existing gaming laws.

New Jersey Governor Chris Christie signed legislation that partially repealed the state’s sports betting ban.  Based on this, the state would allow sports betting at casinos and racetracks, which are licensed by the state.  Monmouth Park would have taken bets this Sunday if not for the temporary injunction filed by the sports leagues.

At this point, the sports leagues (NBA, NFL, MLB and NHL) have filed their reply briefs in New Jersey on the matter and now Judge Shipp will decide on whether oral argument is necessary. The TRO ends November 21st.

For those wondering, this issue is just the latest episode of a long fight for legalized sports betting in New Jersey.  A similar case was denied a U.S. Supreme Court hearing last term.  In arguing that  PAPSA violated states’ rights, New Jersey stated that the law was unconstitutional because it fully exempts Nevada and partially exempts Oregon, Montana and Delaware from the ban.  New Jersey had lost an appeal to the Third Circuit Court of Appeals to a rehearing on the case and attempted to take its case to the U.S. Supreme Court.

As a result of the denial, in August 2014, New Jersey passed the aforementioned partial repeal on the prohibition against sports wagering as a “work around.”  But, this is where we get the lawsuit from the sports leagues.

While the NBA may one day support legalized gambling, the issue here is the state law in New Jersey.  One would think that if a federal law is passed, the sports leagues would comply.

Payout Perspective:

It’s clear that the UFC, with its heritage (and some sponsors) based in the gambling industry, would support legalized sports betting in the U.S.  Certainly, the UFC might have concerns with regulation but overall it would seem like broader availability to gamble on the UFC would garner more interest in its product.  Obviously, the UFC is willing considering it seamlessly offers betting lines during its events and programming.  The new litigation in New Jersey will be interesting to follow as the  underlying issue here is that the law seems to be a way to boost revenue for the state.  Its not clear if the UFC will get involved at this point, but it will certainly be following it closely.

Le attempts damage control in wake of suspension

October 3, 2014

Cung Le responded to the initial reports of testing positive for elevated levels of HGH.  Le denies taking performance enhancing drugs in a Facebook post.

“I was completed (sic) surprised at the results of my recent drug test.  I was informed by the UFC that I passed my pre- and post-fight drug test, as well as the majority of the blood tests with the only abnormality being an elevated level of hGH being determined to be present. “

Le goes on to question the testing that took place.

“I have been informed that there are many possible reasons for a level of hGH  to exceed what is allowed unknowingly and my doctors are researching those possibilities, which may include a much more serious health concern.  I have also been informed about the unreliability of the current hGH testing that exists and it’s (sic) high rate of inaccuracy.”

“We were informed that the laboratory was advised to use the WADA approved rules and procedures when conducting the testing that they administer, yet the lab in Hong Kong contracted to do the testing was not WADA approved, which was surprising since there was a WADA approved lab available in Beijing China.”

The lengthy explanation goes on to bring into doubt the testing facility and its procedures for collection.  Still, the public perception was that Le used PEDs to gain an advantage.  The UFC has not responded to Le’s statement.  It has suspended Le for a year which essentially may end his career with the company.

Payout Perspective:

The press release does some damage control for Le as well as brings into doubt the testing procedures.  The release does a good job of attempting to educate those not familiar with the testing procedures that there could have been an issue with it as well as bring to light the fact that the UFC acts as its own regulatory body for these shows.  The conclusion it hopes readers (i.e., Le supporters) come to is that the process of using a non-WADA approved lab could produce an incorrect result.

NAC to issue ruling on Jones-Cormier brawl

September 18, 2014

The Nevada State Athletic Commission has filed complaints against Jon Jones and Daniel Cormier after review of the video related to their brawl at a UFC media event last month to promote their upcoming fight.  The complaint seeks to fine the fighters up to $250,000 and the potential for all of their fight purses according to the document obtained by MMA Junkie.

The issue will be determined at the upcoming NAC hearing on September 23rd.

According to the complaint obtained by MMA Junkie, the fighters violated NRS 467.158 which allows for a penalty not to exceed $250,000 or 100 percent of the share of the purse whichever amount is greater.  The penalty may include costs for the investigation including attorney’s fees.

Payout Perspective:

It is good to see the commission taking action whereas it appeared that it was going to wait on making a decision on the brawl.  The penalty for Jones and Cormier will probably not take away either of the fighters’ fight purse for their fight (now scheduled for January 2015) but I think that the NAC will issue a stiff fine to prevent these types of fights that could potentially hurt innocent bystanders.  It’s clear that a part of this brawl was precipitated to draw interest in the event and we will see how the commission will rule to prevent future spectacles.

UFC cites Code of Conduct for potential penalty for Monday fight

August 5, 2014

The Monday melee between Jon Jones and Daniel Cormier may have ramifications for both from the Nevada State Athletic Commission and the UFC.  The UFC indicated that it is looking into the incident and citing it as a violation of the UFC’s code of conduct.

“We expect more from our athletes, especially these two gentlemen, who are very well-trained and highly educated professionals.  Their actions were clearly a violation of the UFC’s code of conduct,” stated Kirk Hendrick, the UFC’s Chief Legal Officer, per a report on UFC.com.

Hendrick indicated that the UFC would reserve the right to penalize Jones and Cormier pending the NSAC’s review of the incident.

Payout Perspective:

The Code of Conduct has not been in the news since Matt Mitrione caused a stir with his comments about Fallon Fox.  It’s clear that despite the news it’s achieved, brawling in a public setting where bystanders could have been injured is not a good idea.  However, don’t expect any suspensions.  It’s likely we will see a fine but nothing else.

Sonnen given 2 year ban by commission

July 23, 2014

MMA Junkie reports that the Nevada State Athletic Commission issued a two-year suspension as at a hearing held on Wednesday.

Sonnen must pay any and all doctors’ fees for the random drug tests he failed on May 24th and June 5th.  Additionally, it is expected that he will become a precautionary tale for others and serve as a “resource” for halting future PED use.

There were differing opinions on the penalty for Sonnen as they ranged from a lifetime ban to the 2 year ban.

Sonnen tested for a total of five PEDs prior to his intended July 5th fight with Vitor Belfort.  Initially, he claimed the positive test for PEDs related to him coming off of TRT treatment and the fact that he was trying to have children.  After the second positive test, Sonnen was terminated from the UFC and his analyst position at Fox Sports.

Payout Perspective:

Fair penalty?  Sonnen’s attorney stressed Sonnen’s cooperation with the investigation and the UFC and Fox Sports terminations when contemplating the penalty.  Essentially Sonnen threw himself at the mercy of the commission.  This strategy seemed to work.  Although it’s unlikely Sonnen will return to MMA in Vegas, the two year ban does leave a slim opening.  Moreover, he could have been assessed a stiff fine but seemed to have avoided this.

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