Thursday, April 19, 2018

Judge Denies Top Rank's Summary Judgment Motion in Middendorf Sports, Terence Crawford Case

Earlier this month in U.S. Federal Court, District of Nebraska, Judge John Gerrard emphatically denied Defendant Top Rank's Motion for Summary Judgment regarding the duration of the Promotional Agreement (PA) and Release in the case brought against them by Plaintiff Middendorf Sports (incorrectly spelled Mittendorf in the opinion).

The dispute involves a breach of contract alleged by Middendorf over an agreement by Top Rank to pay Middendorf fees on Terence Crawford's world title defenses.  Crawford was initially promoted by TKO Boxing Promotions, an entity in which Middendorf was a partner.  TKO ran into financial difficulties and assigned Crawford's contract to Middendorf Sports.  Middendorf then entered into a Release with Crawford allowing him to sign with Top Rank in exchange for a fee to be paid to Middendorf equal to 8% of Crawford's purses for any world title defenses promoted by Top Rank pursuant to the PA.

After Crawford became a world champion in March 2014, Top Rank duly paid Middendorf its agreed upon fees once Crawford started making title defenses.  In September 2014, Top Rank and Crawford renegotiated their agreement and entered into a Restated Promotional Rights Agreement (RPA).  Top Rank continued to pay Middendorf for Crawford's next three title defenses.  But in July 2016, Crawford fought a title unification bout against fellow Junior Welterweight Champion Victor Postal.  Middendorf alleges that Top Rank refused to pay the fees for the Postal fight claiming that it was a "unification fight" and not a "title defense".  Middendorf further alleges that Top Rank has failed to pay the fees for any Crawford title defense subsequent to the Postal fight.

Middendorf brought suit in January 2017.

Top Rank argued in their Summary Judgment Motion that once the original PA was terminated and they entered into the RPA, their obligation to pay fees to Middendorf ended.  Middendorf argued that the Release contained no term and did not expire at a fixed time.  Judge Gerrard opined that Top Rank's interpretation was "not supported by basic principles of contract interpretation . . . . Contract interpretation is a question of law, and if the language of the contract is clear and unambiguous, it will be enforced as written."  Judge Gerrard held that the phrase in the Release stating that Top Rank and Crawford would "enter into a promotional rights agreement" was open ended and did not specify a particular promotional rights agreement.

Top Rank further argued that interpreting the Release to have no fixed term would be allowing for a contract in perpetuity.  Judge Gerrard held that the contract obligation was not perpetual because "whether or not the obligation continued was in [Top Rank's] control."

Thus, the Court denied Top Rank's motion and found, as a matter of law and not as a question of fact for the jury, that "the unambiguous language of the Agreement and Release obliges Top Rank to pay Mittendorf (sic) eight percent of Crawford's purse for any Crawford title defense that Top Rank promotes pursuant to a promotional rights agreement."

This was a big win for Middendorf.  This was coupled with similarly strong language from another opinion issued by the Court on the same day denying a Motion in Limine by Top Rank to exclude the expert testimony of promoter/attorney Leon Margoles.  In that opinion, the Court stated that extrinsic evidence of the definition of the phrase "title defense" might be inadmissible because "the term isn't ambiguous."  The Court seems to have a clear reading of the language of the PA and Release in this case and it is seeing things Middendorf's way.

Next up in the discovery phase of this case is Terence Crawford's deposition.

See MSJ Opinion below:

See Motion in Limine Opinion re: Margoles Expert Testimony below:

1 comment:

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