Combat Sports Law

This morning economist/MMA Reporter Paul Gift attended the change of venue hearing in the UFC Anti Trust Class Action lawsuit and provided live updates which he published at BloodyElbow.  Zuffa is asking the Court to move the lawsuit to Nevada and the Plaintiffs wish to keep the matter in Northern California.

In short the Court reserved judgement and it is unclear when a ruling will be handed down although one can likely be expected before Zuffa’s upcoming motion to dismiss the claim is heard in July.

From Gift’s updates, it appears the ruling will likely hinge on whether the Court is persuaded that interpretation of Zuffa contracts will play a vital role in the anti trust litigation.  Below are Gift’s live published updates –

8:48am – Lawyers are starting to file into the hallway. Kyle Kingsbury’s at least one fighter in attendance today…I think.

8:54 – Make that Hallman, Fitch, Le, Kingsbury, Vera, Quarry, and Vazquez in the house.

9:00 – Everybody switching sides! Musical chairs with fighters and attorneys.

9:03 – Everyone looks ready to go. We’re just waiting for the judge now.

9:05 – The judge is here. Time to get things started. UFC case is first.

9:06 – Fighters being introduced to the judge. There’s a lot of “morning” going on here. Reminds me of “Doctor, Doctor.”

9:09 – UFC’s up first. Showing judge the forum selection clause. Seven of 11 fighters have that clause in their contracts. They’re showing the judge a map with fighter locations and selection clause status.

9:12 – Handed the judge a PowerPoint printout that we can’t see. Focusing on venues in Las Vegas and fighters who’ve fought there. Now moving on to legal precedent.

9:15 UFC lawyers are talking to the judge about the “crucial” component of the case and making their argument that contracts must be interpreted, “extensive interpretation.” Judge is saying that plaintiffs arguing there’s no interpretation. UFC responds that whether they say it or not, crucial contracts will have to be interpreted.

9:17 UFC: “Supreme Court argues that seven of these plaintiffs absolutely belong in Nevada. There’s no sense splitting the case.”

9:18 UFC: “All the plaintiffs have to hang their hat on is to say, ‘We chose this forum.'” Judge asks shouldn’t we give some deference to that. UFC: “A little.”

9:20 Judge questioning the UFC about why plaintiffs shouldn’t be allowed to choose a location that’s inconvenient for them.

9:22 UFC’s making an argument about convenience. “Which is exactly why we have clauses like this when we’re doing business.

9:23 Plaintiffs are up now.

9:24 Everybody’s getting handouts, except us in the back. Saveri starts by attacking the UFC’s legal cases. “They all go our way.”

9:25 There’s a back and forth now about an LCD price fixing case. Judge is questioning plaintiffs about the horizontal nature of the price fixing scheme and how that affects venue selection.

9:29 Plaintiffs: “This is not a contract case…there is no claim contracts were breached.” Judge is questioning Saveri about confusing language in his transfer filing.

9:30 Plaintiffs: “The provisions of the contract are relevant but more relevant are the effects in the world.”

9:32 Saveri’s arguing that it doesn’t matter what the Champion’s Clause says, what matters is the effect.

9:33 Judge: “I appreciate that this is not a contract case.” Then he asks Saveri don’t we have to interpret the contracts to determine their anticompetitive effect?

9:35 Judge asks don’t we have to look at clauses to see if an effect is generated by the clauses?

9:36 Saveri says the contractual provisions will be looked at and are relevant to the case, but they’re not asking to interpret or enforce the contract.

9:37 The conversation now moves to the UFC’s old forum selection clause and their new one that seven plaintiff fighters are under.

9:39 Plaintiffs are now arguing for their legal citations and against the UFC’s. These parts put me to sleep.

9:43 Plaintiffs are focusing specifically on one old case with very broad language. They compare it to the old venue selection clause and argue that since the UFC leans on that case, it doesn’t apply.

9:45 Judge is questioning Saveri again about the possible need to interpret contracts during the course of the case.

9:46 Judge: “You’re saying it’s not going to happen.” Saveri: “The closest we’re going to come to that is evidence about what the effect of that is in the market.” Judge asks if there won’t be a question of “What did you mean by this?” Saveri: “We don’t reasonably anticipate that to happen.”

9:47 Saveri: “Even if an interpretation needs to occur, that doesn’t bring it within the cause of action or the reason we brought the claim.”

9:49 The discussion finally turns to convenience and fairness factors. Plaintiffs are still up. Saveri says the UFC’s argument that Nevada can better interpret the contracts is a wash because we’re talking antitrust law. Judge says he tends to agree.

9:51 Saveri’s now arguing that they have plaintiffs who live here, who chose this location, and that deserves deference.

9:52 Saveri’s now arguing that fights happen here, Strikeforce was here, Twitter’s here. “They’re all important.”

9:54 They’re now discussing the differences in costs of litigation in the two areas. Saveri argues the world is getting smaller. UFC execs can be brought here.

9:56 Saveri calls it a “remarkable claim” that NorCal could be inconvenient for Zuffa since they’ve initiated litigation here in the past. “To me that speaks volumes.”

9:58 Plaintiffs final two minutes. Argue: No forum selection case goes their way. Judge interrupts and says he’s looking most closely at the contract interpretation issue. Saveri says the action was not brought to “interpret.”

10:00 UFC’s up last and they focus right on the interpretation issue now that the judge mentioned his interest in it. The UFC’s now quoting an old Amazon antitrust case that they argue supports their position.

10:01 Judge: “Is there any other way to resolve that (interpretation issue)?” UFC: “No…I mean yes. You can say ‘Case dismissed!'”

10:03 UFC quoting plaintiffs’ complaint language and saying it’s “plain wrong” under the contract and the Court will be asked to interpret the contract. Quarry just burst into laughter. Made UFC lawyer pause and mumble about respect in the courtroom.

10:04 And now we’re back to legal case wrangling.

10:05 UFC reveals that plaintiffs asked in discovery for “All documents from 1993 to present discussing, evaluating, or analyzing the contractual provisions at issue in this case.”

10:07 UFC arguing about interpretation. If the Court says it’s a harmless provision, there’s no anticompetitive effect. Economists got their first mention.

10:08 The UFC’s attacking plaintiffs’ arguments about Scott Coker and Twitter.

10:11 UFC just wrapped.

10:14 And that’s it. Everyone just left and the judge didn’t decide, which was always a possibility. There’s another hearing later today. We’ll see what happens then.