Canelo Alvarez is a free agent according to his manager Eddy Reynoso in a social media post on Friday. ESPN and The Athletic confirmed through sources that indeed Alvarez can seek other opportunities as it appears that an agreement between Golden Boy and DAZN has been brokered.
✍🏻#TEAMCANELO🇲🇽 pic.twitter.com/zB2M3Esh4T
— EDDY REYNOSO (@CANELOTEAM) November 6, 2020
Alvarez sued his promotional company Golden Boy and DAZN in September claiming breach of contract among other claims related to his inability to get a fight during the COVID-19 shutdown. After some civil procedure, the lawsuit ended federal court in California where the Judge requested that the parties file the contracts that were in dispute as well as the intent on whether the parties would defer to binding arbitration as indicated in the contracts.
Much case law suggest that arbitration is favored over the courts especially when indicated in a contract. Golden Boy and DAZN argued in favor of arbitration. Alvarez argued that the parts of the case unrelated to the contract issue (i.e., breaking his promotional contract with Golden Boy and ties to DAZN) be heard in court rather than arbitration. In the alternative, he requested that there just be one arbitration.
It looks like none of that will matter as the news came out that Alvarez is a free agent.
Payout Perspective:
In deconstructing of this announcement, it came 6 weeks after the parties met to negotiate a deal in light of the litigation and the anticipatory breach of DAZN. Due to the pandemic, DAZN shut down its operations and could not fulfill fight dates. As a result, Golden Boy, which had a deal with DAZN to promote fights featuring Canelo Alvarez did not take place. Alvarez grew tired of waiting and the lawsuit took place.
The severance between Canelo and Golden Boy and through his promoter DAZN comes at a big cost for Golden Boy. It loses its most marketable fighter and the biggest financial asset in its fighter stable. It also loses out on the agreement it had with DAZN. Despite the fact DAZN is expanding globally as of this month, it is still licking its wounds from lost revenue due to the pandemic.
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