Bellator files Motion to Dismiss in Alvarez Case; Alvarez responds

Bellator has filed a Motion to Dismiss Eddie Alvarez’s Counterclaims against the organization.  The motion will be decided by the Judge without oral argument sometime this month.

As you may recall, the parties had agreed to a couple delays in filing Bellator’s answer in hopes of a possible settlement.  Instead, Bellator filed a Motion to Dismiss the substantive legal claims in Alvarez’s countersuit.  

The motion seeks to dismiss counts 3 and 4 of Alvarez’s Counterclaims.  Those are Tortious Interference with Prospect of Economic Advantage and Breach of Contract.

Bellator’s argues that the matching agreement was confidential and pre-litigation correspondence holds a privilege and is not actionable.  It further claims that Bellator had a right to match Zuffa’s offer and Alvarez’s breach of contract claim lacks a factual basis.  

Tortious Interference with a Contract must show the following:

1)  Plaintiff was in pursuit of business;

2)  Interference was done intentionally and with “malice”;

3)  Interference caused the loss of prospective gain; and

4)  The injury caused damage.

Bellator suggests that Alvarez did not prove this because it had a contractual right to match.  Bellator stresses the fact that for Alvarez to prove his claim, there must be a showing that Bellator submitted its matching contract with intentionally doing this without justification or excuse (i.e., the “malice” component).  It also cites case law which states that “legitimate business reasons” was “justification” significant to deny a successful tortious interference claim.  Here, Bellator’s right to match Zuffa’s offer is its argument that Alvarez’s claim for tortious interference would fail.  

Bellator also claims that the correspondence between itself and Alvarez’s representation constitute a privileged “pre-litigation correspondence” which New Jersey law recognizes.

As for the Breach of Contract claim, Bellator argues that it cannot discern which “contract” Alvarez claims to have been breached.   It labels Alvarez breach of contract claim as devoid of a factual premise.  It also adopts the “pre-litigation correspondence privilege” to this claim.

Eddie Alvarez’s attorneys have filed its opposition brief arguing that Bellator submitted its offer to Alvarez in bad faith.  In its brief, it argues that Bellator knew that it had no intention or ability to perform the terms of the contract and it was done with the intent to prevent or obstruct Alvarez from signing with Zuffa.

Alvarez’s brief argues that much of the legal cases that Bellator cites in its Motion to Dismiss came at Summary Judgment rather than at a Motion to Dismiss.  For those nonlawyers, Summary Judgment usually occurs after discovery (depositions, answering of written interrogatories, etc.) while a Motion to Dismiss occurs around the beginning of the lawsuit.  At most times, a Motion to Dismiss happens before a party must file a response to allegations in a lawsuit.  

Alvarez argues a similar premise to what went against him at the Preliminary Injunction hearing in January.  Essentially, Alvarez argues that Bellator cannot have the Court assume that it would be able to perform the matching terms in the Offer to Alvarez until further discovery is performed in this case.  At the Preliminary Injunction hearing, the Court deferred on ruling whether or not Bellator offer matched the Zuffa contract offer to Alvarez.  Notably, whether Bellator would have a PPV with Alvarez as the headliner.  Here, Alvarez argues that his Counterclaims cannot be dismissed because as the Court determined it cannot decide on whether Bellator could rightfully match Zuffa.  Thus, in this Motion to Dismiss, the Court cannot decide on whether Bellator’s offer was not done in bad faith.

Alvarez also requests that the Court allow him to Amend his Counterclaims if the Court finds in favor of Bellator.  Something like this is normal and the Court would likely allow him to at least bring a Motion to Amend his Counterclaims.

Payout Perspective:

Both sides make plausible arguments for and against Alvarez’s claims.  Alvarez’s logic that the Court cannot determine whether or not Bellator submitted the matching offer in bad faith and thus his claim should not be dismissed is a nice bit of irony considering Alvarez’s legal team wanted the Court to determine that Bellator’s offer was not on par with Zuffa’s in their Preliminary Injunction hearing. Long story short, it’s likely that the litigation in this dispute will continue past Bellator’s Motion to Dismiss.