In 2012 the US Federal Trade Commission closed their investigation into the UFC for alleged anti competitive practices. The investigation ended with the vagueness that only the executive branch of government can give noting “This action is not to be construed as a determination that a violation may not have occurred, just as the pendency of an investigation should not be construed as a determination that a violation has occurred. The Commission reserves the right to take such further action as the public interest may require.“.
In short, as organizations grow, the threat of anti-trust lawsuits are an open ended possibility.
Since the FTC closed their investigation the UFC has continued to consolidate their power as the premier MMA organization in the world. In the latest demonstration of their influence over the MMA landscape, the UFC announced an exclusive apparel deal with Reebok which impacted fighter sponsorship opportunities and was met with mixed reviews by the MMA community.
The UFC now is rumoured to be on the receiving end of an ‘imminent‘ class action anti trust lawsuit. Bloody Elbow broke the story reporting as follows:
“We have been able to confirm that the suit will be based on accusations that the UFC has violated antitrust laws by abusing their “market power” to intentionally and systematically cripple the free market. Several of the individuals we spoke to compared it to the recent San Jose hi-tech employee and NCAA antitrust cases. The manager of one high profile fighter who wished to remain anonymous has informed Bloody Elbow that the plaintiffs will be seeking damages for potentially hundreds of millions of dollars due to reduced fight purses, video game rights fees, and other sources of income. The final amount could even be greater, with statutes awarding “treble damages” in antitrust cases.”
Few details are publicly known about this rumoured litigation. What is known is lawsuits such as this are the major force influencing change in major league sports creating a balance between owners and athletes.
With any sports league the market ultimately demands that there be one and only one truly elite league. Think NHL, NFL, PGA MLB etc. Yes these leagues are not immune from competition in the broadest sense of the word but in reality these leagues are the unrivaled pinnacle of their respective sports.
When an organization obtains this market position they gain significant bargaining advantage over the talent.
There comes a time of critical inequality in contract rights. This eventually gets balanced by collective bargaining rights or a powerful athletes association.
This is an eventuality for top level MMA. Lawsuits like this are usually the triggering events to such change. Whatever your thoughts are on the UFC and their current position in the market, the reality is the stronger it becomes the more likely a lawsuit like this will succeed in creating greater athlete rights.