Guest columnist David Nelmark (attorney and author of MixedMartialArtsLawBlog.com) offers his thoughts on the UFC® Exclusive Promotional and Ancillary Rights Agreement as it pertains to intellectual property rights.
If you spend much time with MMA fighters, sooner or later you will hear one say that he’d sell his soul for a chance to compete in the UFC. While that is not yet required, the standard UFC Exclusive Promotional and Ancillary Rights Agreement does require a fighter to sign over his eternal rights to his “name, sobriquet, voice, persona, signature, likeness and/or biography.”
It is hard to fully capture how broadly this grant of rights extends. It covers basically every aspect of a fighter’s identity, it lets the UFC do anything it wants with the rights—including sublicensing the rights to others—and it provides the UFC with exclusivity throughout the world, and it lasts forever.
So, why would a fighter ever sign this? Ask Jon Fitch. He refused to sign over lifetime rights to use his image in video games and he was immediately cut by the UFC. (Fitch had just lost to Georges St. Pierre so the UFC could legally terminate him pursuant to the terms of his contract.) Fitch eventually relented, which was the financially sound move, at least in the short term. He just made $90,000 for his win over Paulo Thiago at UFC 100.
But what if you’re making your UFC debut on the untelevised undercard? One loss could put you out of the promotion. If that occurred, you’ve essentially sold your lifetime merchandising rights for somewhere in the neighborhood of $3,000 to $5,000. It’s a safe bet that your 0-1 UFC record won’t put you in the next edition of UFC: Undisputed, but your contract says that you can’t appear in EA’s upcoming video game either. Further, no matter how much success you might go on to have in another promotion, the UFC can (at least in theory) prevent you from being in a movie, making an action figure, doing a sports drink commercial, or even creating a website with a URL that uses your name.
On the other hand, at least you can always say that you were a former UFC fighter… or can you? A new provision in the Agreement prohibits fighters from referring to themselves as “UFC fighters” or even using the term “UFC” without written permission. This clause gives the UFC more rights than it would have under federal trademark laws. For example, despite Playboy’s® objections, former Playmate of the Year® Terri Welles was allowed to use the terms “Playboy” and “Playmate” on her website because the terms accurately described her résumé. Playboy Enter., Inc. v. Welles, 279 F.3d 796 (9th Cir. 2002). But, just because the “fair use” doctrine ordinarily allows references to someone’s brand name, one can still sign away that right in a contract.
It is important to note that the broad language in the Agreement does not necessarily mean the UFC will use all the rights granted to it or that it will successfully prevent a fighter from exercising those rights elsewhere. First and foremost, the UFC might choose to willingly release a fighter from the deal if it no longer wants to exercise the rights. Second, if the UFC attempted to enforce the Agreement, a court could find that certain portions of the agreement are unconscionable and therefore strike them from the Agreement. Third, a fighter and his attorneys might be able to exploit some loopholes in the deal. (In my opinion, it’s very well drafted, but not airtight.) All that said, if the UFC does not want to play nice, it would take an expensive legal battle for a fighter to reclaim his publicity rights, and there would be no guarantee of success.
How can the UFC get away with this? The short answer is that they are not doing anything illegal. It’s a private company and they can choose which athletes they want to work with, and on what terms. The longer answer is that the UFC has no real competition. And, unlike the NFL, MLB, NBA, and NHL, its athletes have no union and thus no collective bargaining power. Unless the landscape changes in one of those areas, the UFC has all the leverage and no need to negotiate.
As Dana White famously asked: “Do you want to be a [expletive] fighter?” If the answer is yes, and you want to fight in the UFC, the bottom line is that you sign the deal. If you don’t, there’s likely a thousand guys in line who will.
This article does not (and is in no way meant to) provide business or legal advice. Reading it does not create an attorney-client relationship between us. If you need individual guidance, contact a licensed professional. If you want to read more of my general thoughts on the intersection of MMA and the law, please visit me at www.MixedMartialArtsLawBlog.com.
good post