Friday, September 29, 2017

Top Rank to produce documents in MMA fighter class action v. Zuffa

Attorneys representing the class of fighters who are suing Zuffa, LLC (the UFC's parent company) on monopoly and monopsony grounds, filed a Notice of Resolution of the their Motion to Compel Top Rank, Inc. to produce financial documents in the case.  Unfortunately, the Notice of Resolution is heavily redacted but it's clear that Top Rank will produce at least some financial documents in the case.

In the Motion to Compel, plaintiffs' attorneys had sought "full year, aggregated financial data which includes total revenues generated from the promotion of boxing events, and total compensation paid to boxers."  The Motion quoted Arum as saying that Top Rank paid its boxers approximately 80% of proceeds generated from boxing events compared to the UFC which he stated "doesn't pay out 20% to the fighters . . . They are a monopoly - and we are not."

See Motion to Compel below:

See Notice of Resolution below:

Wednesday, September 27, 2017

District Judge denies Motions for Judgment as a Matter of Law and for a New Trial in Wilder v. World of Boxing, LLC

Today, District Judge Andrew Carter issued an opinion denying World of Boxing, LLC's Motion for Judgment as a Matter of Law and Motion for a New Trial in the Deontay Wilder v. World of Boxing, LLC ("WOB") case in the United States District Court, Southern District of New York.  Judge Carter remarked in his opinion that WOB was "a defeated combatant unwilling to accept a sound jury verdict."

This case involved the alleged ingesting of the banned substance, Meldonium, by heavyweight contender Alexander Povetkin ahead of his scheduled world title bout against WBC Heavyweight Champion Deontay Wilder, which was slated for May 21, 2016 in Moscow, Russia.  Nine days before the scheduled bout, it was announced that VADA, which conducted the testing for the fight, had determined that Povetkin's April 27 urine sample had tested positive for Meldonium.  Wilder, after receiving this news, cancelled his flight to the site of bout.  Wilder's promoter DBE had negotiated to have Wilder's purse put in escrow ahead of the bout.

Wilder eventually sued WOB for breach of the bout agreement (for failing to deliver Povetkin), breach of the escrow agreement (for failing to instruct the escrow agent to pay Wilder) and requested a declaratory judgment (instructing the escrow agent to release the funds to Wilder).  WOB counter-sued claiming breach of the bout agreement (for Wilder failing to show for the fight), breach of the escrow agreement (for Wilder's improperly instructing escrow agent to not release the funds), breach of the implied covenant of good faith and fair dealing (for Wilder acting to pressure WBC to cancel the bout) and defamation (for Wilder's statements to the press about Povetkin's alleged use of PEDs).

The case was set for an expedited trial on one issue only: whether Povetkin ingested Meldonium on or after January 1, 2016.  The January 1, 2016 date is significant because that is the date WADA put Meldonium on the banned substance list.  Part of Povetkin's argument was that he had legally ingested Meldonium in 2015 and that the positive test in April 2016 was only from remnants of his ingestion when it was legal.  In fact, there were three urine samples that Povetkin gave prior to this positive test (April 7, April 8 and April 11) that showed results similar to positive tests for Meldonium but were determined by VADA not to be Meldonium.  The experts on both sides of the case argued that those three tests supported their side's arguments.

On March 6, 2017, after a three-day trial, the jury took only 32 minutes of deliberation to find that Povetkin had indeed ingested Meldonium on or after January 1, 2016.   WOB filed the motions for Judgment as a Matter of Law and for a New Trial within a week of the verdict.

In the opinion issued today, in regards to the motion for Judgment as a Matter of Law, Judge Carter stated that the jury had heard "two interpretations of complex scientific evidence" and that "Wilder's expert testified that Povetkin's April 7, April 8, and April 11 urine samples contained a compound similar in weight to Meldonium, but [Wilder's expert] was adamant that Meldonium was not present.  [WOB]'s expert testified that Povetkin's April 7, April 8, and April 11 urine samples contained Meldonium, but a compound with similar weight interfered with Meldonium.  The jury was free to choose."  Judge Carter reasoned that even if the jury believed WOB's expert, it could still have found that Povetkin took Meldonium on or after January 1, 2016.  Judge Carter also held that the jury heard Povetkin's testimony that he only took "vitamins" from his trainer and chose to reject his testimony.  Thus, the Court held that the evidence supported the verdict and denied WOB's motion for Judgment as a Matter of Law.

Regarding the Motion for a New Trial, Judge Carter stated that WOB's "attempt to re-litigate expert testimony only underscores that the jury had to pick one expert's theory on Povetkin's samples or the other."  Judge Carter also rejected WOB's attempts to enter newly discovered evidence (a study finding that Meldonium may stay in the blood for up to 147 days and WADA's notice in May 2017 that only Meldonium over 100 ng/ml should be reported (Povetkin tested at 72 ng/ml)).  Carter found that the study was released on the first day of trial and could have been uncovered then and that WADA's notice was not to be considered because the bout agreement was executed in April 2016 under WADA's 2016 standards.  Thus, Judge Carter denied that Motion for a New Trial.

Judd Burstein, Wilder's counsel, has previously stated that once WOB's post-trial motions were denied, he would file a motion for summary judgment seeking damages and serve a motion for sanctions unless WOB dropped the defamation case.  We will continue to track how this case proceeds.

See Judge Carter's opinion below:

Thursday, September 21, 2017

Update on Ninth Circuit Appeal in Golden Boy v. Haymon

In May 2015, Golden Boy Promotions sued Al Haymon and his various corporate entities, along with the hedge funds and individuals who funded the PBC for antitrust violations.  Specifically, Golden Boy alleged violations of the Sherman Act, including attempted monopolization (Section 2) and unlawful "tying" (Section 1); injunctive relief under the Clayton Act; violation of the California Unfair Practices Act; and unfair competition under California law.

In January 2017, Judge John Walter in the United States District Court, Central District of California wrote an opinion granting Haymon's motion for summary judgment against Golden Boy (the other defendants had already been dismissed from the case).  See the full opinion at the bottom of the article.

In summary, the Court denied the Section 2, Sherman Act claims as it found Haymon's exclusive television contracts did not foreclose Golden Boy or other promoters from access to television networks.  The Court further held that Golden Boy had not presented sufficient evidence of "venue blocking" or "predatory pricing".  The Court also held that Golden Boy could not establish antitrust injury based on violations of the Ali Act because the only parties with standing to assert such claims are boxers and government agencies.

The Section 1, Sherman Act claims were similarly denied as the Court did not find a tying arrangement between Haymon and his boxers as the provision in his contract that boxers could not sign promotional agreements without his approval did not prevent boxers from being promoted by competitors in the promotional market.  The Court also found that Golden Boy failed to demonstrate Haymon possessed market power in the tying product.  The Court criticized Golden Boy's experts for the "fundamental flaws" in their market definition.  Further, the Court held that the barriers to entry were very low in the boxing management market and that non-Haymon managed boxers had not been foreclosed from fighting Haymon-managed boxers on PBC broadcasts.

Having denied the Sherman Act claims, the Court denied injunctive relief under the Clayton Act. Similarly, since the federal Sherman Act claims were dismissed, the Court declined to exercise jurisdiction over the state law claims.

In February 2017, Golden Boy appealed this decision to the United States Court of Appeals for the Ninth Circuit.  In May 2017, the parties tried unsuccessfully to resolve their differences through arbitration.

In August 2017, the amended briefing schedule was set as follows: Golden Boy's opening brief  is due October 27, 2017; Haymon's answering brief is due December 15, 2017; and an optional reply brief from Golden Boy is due within 32 of service of the answering brief.

See the briefing order below: See the full opinion of Judge Walter below:

Wednesday, September 20, 2017

Judge Dismisses Dominic Breazeale's Lawsuit Against Deontay Wilder

Last month, in United States District Court, Central District of California, Judge Stephen Wilson dismissed the lawsuit filed by Heavyweight contender Dominic Breazeale and his trainer Manny Robles against WBC Heavyweight Champion Deontay Wilder, Marcellus Wilder (Deontay's younger brother) and Marriott International, Inc. in regards to a brawl that broke out in the Birmingham Marriott lobby after Wilder's title defense against Gerald Washington on February 25, 2017.

The complaint alleged assault and battery against the Wilder brothers, as well as premises liability and negligence against Marriott.  According to the factual allegations of the complaint, Breazeale was sitting in the audience with his family after his thrilling victory over Izu Ugonoh and awaiting Deontay Wilder's fight, when Marcellus started shouting profanities at him.  Marcellus then came over and stood in front of Breazeale, who had his son in his lap and continued to taunt and provoke Breazeale.  Eventually, Breazeale decided to leave and return to the Marriott to avoid a confrontation.

The complaint further alleges that Deontay Wilder then made threatening statements about Breazeale at the post-fight press conference, including stating that it "ain't a problem I want to see him [about] in the ring.  So, I'll see him."

A few hours after Deontay's press conference, as Breazeale, his family and Robles were in the lobby on their way to dinner, they were confronted by Marcellus and Deontay.  The complaint alleges that words were exchanged and both Deontay and Marcellus threw punches at Breazeale, Robles and others in the vicinity.  As Breazeale and his family tried to escape, Breazeale's wife allegedly asked Deontay to stop trying to provoke a fight in front of Breazeale's children and Deontay allegedly replied: "Fuck your kids."  As Breazeale turned around on the way to the elevator, Marcellus allegedly sucker-punched him in the back of the head.

There is some very limited video footage of the brawl courtesy of TMZ.

The complaint in the case was filed on April 13, 2017.  Marriott moved to dismiss for lack of personal jurisdiction in the state of California.  On July 7, 2017, the Court ruled in Marriott's favor dismissing the case against them.  On July 21, 2017, the Court then filed an order to show cause why the case should not be dismissed for lack of prosecution due to lack of proof that the summons and complaint had been served on all defendants.  On August 9, 2017, the Court issued an order dismissing the case, stating the "[c]ase should have been closed on [entry of the order dismissing the case against Marriott] dated July 7, 2017."

See the orders dismissing the case, as well the order to show cause, below:

Sunday, September 17, 2017

Thoughts on GGG-Canelo

Excellent fight on Saturday night between two of the top pound-for-pound fighters in the sport, WBC, WBA and IBF Middleweight Champion Gennady "GGG" Golovkin and former WBC Middleweight Champ Saul "Canelo" Alvarez.  The general consensus seems to be that GGG should have gotten the decision.  However, the back and forth nature of many of the rounds made it difficult to score and the draw verdict was not a completely unjust one.  I scored the fight 115-113 (7-5 in rounds) for GGG.  One of the official judges Adalaide Byrd scored it 118-110 for Canelo.  Her card seems to be an outlier as most folks in press row seemed to have it 115-113 or 116-112 for GGG, with a few scoring it 115-113 for Canelo.

Below is a breakdown of the scoring totals of the official judges scorecards, as well as my own:

A few observations on what went down:
  • As mentioned above, judge Adalaide Byrd had a card that was an outlier from not only her two fellow judges but most of the viewing public and even the fighter she scored it for (in the post-fight interview, Canelo stated that he won 7 or 8 rounds - Byrd gave him 10).  She definitely has some history as an outlier who scores fights wider than or contrary to her fellow judges. As recently as June of this year, she scored the Eddie Ramirez - Erick Bone fight 7-3 for Bone, as the other judges had it 7-3 Ramirez prompting the commentators to ask "What was Adalaide Byrd looking at?"  She had Errol Spence up 7-3 vs. Kell Brook in a fight most had close to even in rounds going into the 11th and final round. In December 2016, she had Richard Commey beating Denis Shafikov 8-4 in an IBF eliminator but was overruled by her two fellow judges. Also in 2016, in what was a real head scratcher, she somehow had Maurice Hooker beating Darlys Perez 7-3 in a fight most everyone in press row and at home had Perez winning handily. In other words, this is not the first time she's scored a fight way out of line with the majority. Top Rank, apparently, objected to her as a judge for the Vasyl Lomachenko-Nicholas Walters, though the NSAC still allowed her to judge the fight. I'm pretty sure K2/GGG Promotions wish they had objected as well in hindsight.
  • GGG looked really tight in the early going and, despite the exhortations of Abel Sanchez, completely ignored Canelo's body for nearly the entire fight. According to an ESPN statistical breakdown of the fight, GGG only landed 8 body shots for the entire fight. That is not a misprint. He also connected on only 31% of his total punches, way down from his norm of 40%. His headhunting cost him accuracy and did not slow Canelo and allowed him to get that second wind and come on down the stretch. I'm sure Abel will chide him during film study for the rematch that to slow down Canelo - he needs to pay more attention to landing those lethal body shots. Ask Matthew Macklin what a difference maker GGG's body shots are.
  • Canelo surprised me with how superior his hand speed was to GGG's. He was able to beat GGG to the punch time and again and looked like he could have stood in and traded a little more. Canelo made a huge tactical error in my estimation by constantly going idle and letting GGG get off for sometimes minutes at a time in rounds. Canelo often started rounds by landing crisp clean combinations on GGG but then would practically give the rest of the round away. Obviously, a big part of that was stamina but also poor tactics. This was a very winnable fight for Canelo. He needs to study the tapes of Hagler-Leonard or Ali-Frazier II to learn how to get his shots off and then tie up to get his rest - as opposed to aimlessly dancing and settling on the ropes. By clinching, instead of falling into the ropes, Canelo could have muted GGG's rallies and caught a breather in order to mount his next quick-handed volley. We'll see if he makes this adjustment in the inevitable rematch. 

Wednesday, September 13, 2017

Middendorf Sports Files Second Amended Complaint vs.Top Rank and Bud Crawford

On September 1, 2017, attorneys for Middendorf Sports, the corporate entity for matchmaker/advisor/promoter Chris Middendorf, filed a second amended complaint ("SAC") in their ongoing breach of contract suit against Top Rank and undisputed Junior Welterweight Champion Terence "Bud" Crawford in United States District Court, District of Nebraska, Case No. 8:17-cv-00011.

(An earlier report on the SAC by ESPN made it seem as if Middendorf Sports had just recently filed this suit, when, in fact, the original complaint in this case was filed on January 10, 2017.)

Sometime in the mid-to-late aughts, Middendorf, along with Chet Koerner, formed a promotional company, TKO Boxing Promotions. According to the SAC, in December 2010, TKO signed Crawford to a promotional deal. By mid-2011, TKO had fallen on tough times and worked out an Agreement and Release ("A&R") to have Top Rank promote Crawford. In the fee provision paragraph of the A&R, Top Rank was to pay TKO a fee equal to 8% of Crawford's purses for any world championship title defenses promoted by Top Rank pursuant to the Promotional Rights Agreement between Top Rank and Crawford.

In July 2011, TKO assigned its rights under the A&R to Middendorf Sports. In September 2014, Top Rank and Crawford entered into a Restated Promotional Rights Agreement to promote Crawford for the next 3 years with options to extend for another 3 years.

The SAC alleges that Top Rank paid Middendorf Sports without fail pursuant to the A&R through July 23, 2016 - including title defenses by Crawford against Yuriorkis Gamboa on June 28, 2014, Ray Beltran on November 29, 2014, Dierry John on October 24, 2015 and Hank Lundy on February 27, 2016.

On July 23, 2016, Crawford, then the WBO champion, unified the titles against then WBC champ Viktor Postal. The SAC alleges Crawford was paid $1.3 million for the fight but Top Rank failed to pay Middendorf Sports its fee under the A&R. Similarly, the SAC alleges Top Rank has refused to pay Middendorf Sports for subsequent defenses by Crawford against: John Molina, for which he was paid $1.5 million; Felix Diaz, for which he was paid $1.6 million; and Julius Indongo, for which he was paid over $2 million.

The SAC alleges causes of action for: 1) Breach of Contract; 2) Breach of the Implied Covenant of Good Faith and Fair Dealing; 3) Accounting; and 4) Declaratory Judgment.

The SAC does make clear in a footnote that Crawford is only named as a nominal defendant and Middendorf Sports does not allege that he did anything wrong or actionable.

See the entire filed SAC, including exhibits, below:

Monday, September 11, 2017

Multi-District Litigation In Re: Mayweather-Pacquiao PPV Dismissed

On August 25, 2017, in the United States District Court, Central District of California, Judge R. Gary Klausner issued an opinion dismissing all of the claims filed in 26 individual actions and 15 consolidated complaints alleging that Defendants Floyd Mayweather, Mayweather Promotions, LLC, Manny Pacquiao, Top Rank, Inc., Michael Koncz, Bob Arum, Todd DuBeouf and HBO all concealed Pacquiao's shoulder injury and mislead the buying public into paying for the fight that they would not have otherwise purchased.

Judge Klausner ruled that letting these claims stand would "disrupt the nature and integrity of competitive sports."   Judge Klausner used the doctrine known as the "license approach" in determining the legal rights of the ticket purchasers.  Under this doctrine, "a ticket to a sporting event gives the purchaser 'nothing more than a revocable license' to view what transpires at the ticketed event, regardless of prior promises or representations about the performance."

Judge Klausner held that "a misrepresentation or omission implicates the core of athletic competitions, and therefore does not constitute a cognizable injury to a legally protected interest under the license approach, if it is related to: (A) competitive strategy, or (B) the quality or outcome of competitive performance." Judge Klausner then reasoned that all of the alleged misrepresentations of the Defendants in regards to Pacquiao's injury fell under either competitive strategy or the quality of the performance.

"The Court is sympathetic to the fact that many boxing fans felt deceived by the statements and omissions made by the fight's participants and promoter.  The proper remedy for such unscrupulous behavior when it implicates the core of athletic competition, however, is not a legal one.  Disappointed fans may demand that fighters be more transparent in the future, lobby their state athletic commissions to impose more stringent pre-fight medical screenings and disclosure requirements, or even stop watching boxing altogether. They may not, however, sustain a class-action lawsuit."

"In this case, Plaintiffs ultimately received what they paid for, namely: the right to view a boxing match between Manny Pacquiao and Floyd Mayweather, sanctioned and regulated by the Nevada State Athletic Commission. Plaintiffs had no legally protected interest or right to see an exciting fight, a fight between two totally healthy and fully prepared boxers, or a fight that lived up to the significant pre-fight hype."

See Judge Klausner's opinion below:

Saturday, September 9, 2017

NY State Settles Mago Case for $22 Million

Yesterday, both ESPN and BoxingTalk reported that the family of heavyweight boxer Magomed Abdusalamov ("Mago") has agreed to settle its personal injury suit against the State of New York and certain officials of the New York State Athletic Commission ("Commission") for the sum of $22 million.  The settlement encompasses claims made against the state of New York in Thomas v. New York, Case No. 126865 in the New York State Court of Claims, as well as claims against the Commission's Chief Medical Officer Barry Jordan and an inspector (and former boxer) Matthew Farrago in Thomas v. Farrago, Case No. 505880/2014, in the Supreme Court of the State of New York, County of Kings.

Mago was injured in his bout with Mike Perez at Madison Square Garden on November 2, 2013. Mago appeared to take a hard forearm to the face in the first round and visibly complained to his corner.  Mago fought on and went the full ten rounds with Perez in what was a very spirited and competitive bout.  After being examined by Commission doctors in his dressing room, Mago was allowed to leave the arena on his own and soon after started vomiting.  He was taken to the hospital in a taxi by his handlers where he was diagnosed with a subdural hematoma.  He was then operated on to relieve the pressure on his brain and placed in an induced coma.

According to the ESPN report, Mago, 36, is still unable to walk and is paralyzed on the right side of his body.  His speech is also severely impaired and his doctors have stated he may never walk again.

The complaint filed in the Supreme Court, County of Kings, named Farrago, Jordan, as well as ringside doctors Anthony Curreri, M.D., Osric King, M.D., Avery Browne, D.O., Gerard Varlotta, D.O., referee Benji Esteves, Jr., promoter K2 Promotions, LLC and the venue MSG Holdings, L.P., as defendants.  All but Curreri, King, Varlotta and Esteves have now been dismissed from the case.

On June 29, 2017, Mago's attorneys filed a note of issue in the Supreme Court that they are ready for trial. Their most recent filing was a good faith demand letter to the attorneys of defendant doctors Curreri, King and Varlotta that they settle for the limits of their insurance coverage, which would net an additional $6.2 million for Mago.

Sunday, September 3, 2017

Odds and Ends Post-Mayweather vs. McGregor

  • Erik Magraken, at the excellent Combat Sports Law blog, made an interesting find on Floyd Mayweather's pre-fight medical questionnaire. Floyd apparently admitted using injections of Kenalog (an anti-inflammatory) in his hands at 5 a.m. on the day of the fight.  Magraken noted that although Kenalog is a banned in-competition substance according to WADA's prohibited list - the WADA (and USADA, the testing entity) definition of "in-competition" only prohibits ingestion within 12 hours of competition.  Thus, with the fight happening around 9 p.m. PST, Floyd was within the rules to have the injection (depending on how the injection was administered - read the post).
  • Zach Arnold, at another great MMA site Fight Opinion, believes that "it is blatantly clear that Conor McGregor will continue fighting in both boxing and MMA."  Arnold also reported that Dana White was "non-committal" about whether WME-IMG may be willing to give McGregor a percentage interest in the UFC in order to keep him in the fold.  Arnold also quoted MMA legend Randy Couture as saying that this fight highlighted the financial issues MMA fighters face vis-a-vis boxing. Couture predicted that more MMA fighters will crossover to boxing in order to reap the sponsorship and PPV upside opportunities that are currently not present in the UFC.
  • Though Dana White was initially spewing about the number of PPV buys being above 6.5 million, according to ESPN, it appears the more realistic number is likely to land between 4 and 5 million buys.  Thus, it may not even break the previous PPV buy record set by Mayweather-Pacquiao at 4.6 million buys.

Great Show At The Hammerstein Tomorrow