13 for 13: No. 5 Eddie Alvarez-Bellator settle lawsuit

The Eddie Alvarez-Bellator legal saga came to an end this year with Alvarez settling with Bellator and making a triumphant appearance at Bellator 106.  The legal case which Alvarez vowed would go to trial settled in time for Alvarez to face Michael Chandler on November 2^nd.

As we know the story, Alvarez completed his fight contract with Bellator although the company had “matching rights” which would allow it to keep Alvarez so long as it matched any competing offers.  Alvarez and Bellator had agreed that Bellator would get a chance to match the offer made by the UFC.  In fact, court documents show that it had cut and paste the UFC contract almost verbatim.  Still, Alvarez’s camp argued that the Bellator “match” did not match the UFC contract.  Bellator sued Alvarez, Alvarez sued Bellator and Alvarez attempted to file a Preliminary Injunction to allow Alvarez the opportunity to bolt for the UFC.  The court denied the PI.  The court also denied a motion by Bellator to dismiss Alvarez’s lawsuit against it.

Alvarez proclaimed that he would go to trial to settle this dispute.  Other fighters supported Alvarez and Alvarez talked about how Bellator mismanaged some of its fighters.  For this, Bellator head, Bjorn Rebney had to go into damage control to explain some of the issues Alvarez had highlighted.

The case would not have gone to trial until late 2014 at the earliest.

Alvarez went on a PR march claiming the Bellator had attempted to alter a document regarding the matching terms of his contract.  In fact, Alvarez produced the document (and the attempted “blacking out” of his address which you could still see) but it did not lend much to his theory.

Fortunately, Alvarez agreed to terms with Bellator which, in the end, likely saved Bellator 106.  Alvarez did not speak about the terms of his return to Bellator and his return was marked by this odd interview with Alvarez by Glenn Robinson’s daughter.

The lawsuit likely served as a guide for contractual dealings with Ben Askren.  The Welterweight champ was let go by Bellator even though the organization had matching rights in its contract with Askren.  Despite the fact Bellator let its champ go, it was less of a public relations issue than if it became mired in another lawsuit.

The court documents revealed the UFC contract and its PPV buy structure.  While these terms may have been released in the past, it was still interesting to look at the UFC’s structure in how fighters are paid based on PPV buys.  It also showed some of the added benefits Bellator was willing to give Alvarez if he stayed which included guests spots on Spike TV programming.  But, the key issue was the PPV upside that Alvarez would receive if he joined the UFC.  Earlier this year, Bellator had not put on a PPV although there were vague notions that it would put on a show.  As we know, it eventually announced a PPV to be headlined by Rampage Jackson versus Tito Ortiz.  We all know how that turned out.

There was also Dave Meltzer’s Declaration in support of Eddie Alvarez’s Preliminary Injunction.  Meltzer indicated PPV buy rates in his declaration to support Alvarez’s initial argument that Bellator did not match the UFC’s contract.  If the case would have proceeded and came closer to trial, Meltzer would have been deposed and/or testified at trial.  Attorneys would be able to inquire about how he substantiated PPV buy rates including such information as where he gets his information and if there is a formula for his PPV analysis.  Certainly, Meltzer could have claimed that he does not need to reveal his sources based upon his journalistic ethics.  Yet, it would have created an interesting scenario.  But, once again, the settlement saved this issue.

And, in the end, Meltzer was right about the “matching” thing.

The fact that Bellator cancelled its PPV after Ortiz’s injury shows that it did not believe Alvarez could headline a PPV (or it did not have enough time to market Alvarez as its top star).  Regardless of the reasons for turning the PPV into a card on Spike TV, the cancellation of the PPV may have confirmed what Alvarez may have known throughout:  that Bellator was not the same as the UFC.