While the Le Antitrust lawsuit is gaining headlines since it is likely going to trial, the Kajan Johnson antitrust lawsuit against UFC –>Zuffa –> TKO Group Holdings, Inc. –>Endeavor is trailing and Endeavor filed a Motion to Dismiss the lawsuit on Monday.
While its likely that this Motion will be denied like the motion that was filed in Le years ago, we take a look at it in light of Endeavor taking over Zuffa.
The Motion is similar to the one in Le as it once again argues that the Plaintiffs fail to plead monopsonization by Endeavor. Essentially, plaintiffs do not show that Endeavor acquired monopsony power through exclusionary conduct causing antitrust injury through the conduct. Endeavor argues that there is no material evidence from plaintiffs which show that Endeavor acquired the market power through anticompetitive means and it must follow that there are no damages as a result.
Something different in this Motion is that Plaintiffs cannot hold Endeavor vicariously liable for Zuffa’s alleged conduct. Endeavor argues that plaintiffs cannot hold Endeavor liable as a result of the alleged actions of Zuffa.
Endeavor argues that they cannot argue that Zuffa and Endeavor are one in the same (i.e., a single corporate entity). Thus, unless plaintiffs can show an independent violation by Endeavor, the allegations must be dismissed.
Endeavor argues that its actions after taking over Zuffa were not “critical” to an alleged scheme. They also make another attack of Dr. Singer’s report, but this time in the Johnson case as they foreshadow a legal strategy in a footnote.
The Motion (actually the third iteration in the Johnson case) relies heavily on the legal liability of Endeavor (and not its subsidiary Zuffa) by distancing any alleged actions from the main company while inferring that the plaintiffs cannot show liability with an after-acquired company. While I do believe this Motion will be denied the legal arguments are persuasive to give pause to the Johnson plaintiffs about how it proceeds.
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