Reasons for judgement were released last week in the ongoing anti-trust lawsuit against UFC parent company Zuffa ordering disclosure of various documents that “contain Zuffa’s negotiating positions and business strategies and decisionmaking.”

In the recent judgement (Le v. Zuffa) Zuffa tried to hold back 12 documents from production arguing they were subject to attorney-client privilege.  The court largely disagreed ordering production of 11 of the 12 disputed documents which deal with contract negotiation strategy and clothing sponsorship issues.  In reaching this decision Magistrate Judge Peggy Leen provided the following reasons:

The court carefully reviewed the documents, considered the context of the communications in which various individuals who sent or received the documents was involved, and found Zuffa simply had not met its burden of showing the documents were privileged. The summary merely recites what the fighter, through counsel, was requesting in contract negotiations. The summary contains no legal analysis or advice, nor do the emails which forward information about what the fighter was requesting, and comment on whether Zuffa should agree or disagree. The court finds these documents contain Zuffa’s negotiating positions and business strategies and decisionmaking, and are not attorney-client privileged communications. The documents involve discussions, and requests for input on business decisions involvin contract negotiations with the fighter, express the business implications of setting precedent in negotiations with others, and comment on whether proposed terms were reasonable or ridiculous, and/or whether certain requested terms had been given to any other fighter in the past.

Most of the Mersch memo contains comments about whether Zuffa could or should agree or “push back” on proposed changes requested by the fighter rather than legal analysis or discussion of the legal ramifications of the fighter’s proposals. However, portions of Mr. Mersch’s memo to Mr. Fertitta, read in context, contain his legal analysis of existing contract terms and the legal consequences of agreeing or disagreeing with what the fighter’s counsel was proposing. Although the memo does not specifically use terms or phrases such as “this is my legal advice” or “this is the legal effect” of what the fighter’s counsel is requesting, legal analysis of the proposed terms is evident. The court will therefore require that the document be produced to Plaintiffs as redacted below.

The second set of documents are emails exchanged between Zuffa’s Vice President of Licensing and Merchandising, and Executive Vice President and General Counsel during the relevant time period. The emails involve discussions about a clothing line company promoting its line at UFC events which had also entered into an agreement with a national retailer to sell UFCrelated clothing. The email chain starts with a newspaper article commenting on what the clothing line company was doing and contains internal business discussions about Zuffa’s licensing and sponsorship decisions and strategies. The exchanges describe what Zuffa was doing, what various executives thought it should be doing, whether a change in the relationship with the clothing line company would impact the compensation of one of Zuffa’s fighters who had an agreement with the company, the fighter’s likely response should Zuffa change the arrangement, and comments Zuffa should be developing its own brand to maximize its revenue potential. Zuffa has not met its burden of showing these emails were to solicit or receive legal advice. Rather, the documents discuss business positions, strategies, options Zuffa had for addressing the situation and potential business consequences of various alternative courses of action.

Update February 21, 2017 – Today Ryan Madden, Communications Manager for USADA, was kind enough to reply to both questions posed below.  He elaborated on the retroactive TUE standard in place for USADA and further confirmed that Justino did not initially disclose her use of Spironolactone to USADA’s doping control official when collecting her sample.

The legal significance of this is it suggests that failing to disclose a medication you are taking to USADA upon sample collection, even if it is a prohibited substance absent TUE, is not in and of itself a policy violation so long as you are using the substance for “legitimate medical purposes“.

Below is Madden’s full reply:

  • Her use of the medication was not initially disclosed; but more importantly, once contacted by USADA, she immediately identified the medication as the source of her positive test, submitted all necessary medical information and demonstrated that it was being used for legitimate medical purposes without enhancing her performance. Those are the primary considerations when reviewing any TUE application.”
  • On background: The criteria for application above is specific to the Olympic side. For UFC athletes, retroactive TUEs will only be considered where the use of a prohibited substance or method is medically justified. However, this is the just the criteria that an athlete has to meet in order for their application to be considered. Once that is determined to have been met, the athlete is then subject to the same TUE protocols as all other athletes. This is a comprehensive process that includes submitting extensive medical documentation that is reviewed by a committee of medical professionals from across the country. This therapeutic use exemption committee (TUEC) is made up of over 20 members, and at least two members review each TUE application  — unless there is a split-decision in which case a third member is brought in. Athletes must prove there is a legitimate clinical need for the substance, prove the substance is only being used to return them to normal state of health, and that there are no alternative, non-prohibited medications available.
  • USADA encourages all athletes to apply for a TUE prior to the use of any prohibited substance or method to ensure they are not at risk for an anti-doping policy violation.
  • For information on the UFC TUE guidelines, visit our website  here.


Last week the United States Anti Doping Agency published a press release noting they were providing Cristiane “Cyborg” Justino a retroactive therapeutic use exemption (“TUE”) after she tested positive for a prohibited substance in December of 2016.

The substance in question was Spironolactone, a prohibited diuretic and masking agent.  The drug has legitimate medical applications and Cyborg clearly persuaded USADA that her use of the product was above board.

While there is nothing controversial about granting a TUE when a drug is legitimately needed (whether immediately or retroactively) two questions arise from the Cyborg case

  1. If Cyborg failed to disclosed the drug’s use at the time of sample collection could that not be a stand alone violation?
  2. What standards do USADA use when granting a UFC fighter a retroactive exemption and do these differ from standards for other athletes?

On the first point, standard protocol when a urine sample is collected by USADA is for an athlete to reveal all drugs and supplements they are ingesting.  For reference see the 4 minute 15 second mark of the below USADA video.

USADA’s press release make no mention of Spironolactone disclosure until after the positive test came back.  Assuming this is the case should the omission be its own violation?

Section 2.5 of the custom tailored UFC/USADA anti doping policy notes that it is a violation to tamper with doping control.  Tampering includes “providing fraudulent information to UFC or USADA“.

Failing to disclose the use of a prohibited substance could meet this definition however the key is the word ‘fraudulently‘.  Fraud requires intent and this standard provides some legal wiggle room.

The UFC/USADA standard can be contrasted with that of many athletic commissions.  As was learned from the Nick Diaz saga, commissions often require drug disclosure to be made under penalty of perjury and omission can be legally fatal.

I have written to USADA for clarification on why (assuming Cyborg failed to disclose the substance at the time of collection) this did not amount to its own violation.  Presumably the answer is intent. I will publish their response if/when they reply.

Regarding the second point, the USADA press release does not make it clear what standard Cyborg had to meet to obtain her retroactive TUE.  While the test for a TUE itself remains identical whether applied for immediately or retroactively, athletes generally have to meet a further legal test when they fail to apply for one promptly.

USADA’s website publishes the following standards for a retroactive TUE

An application for a TUE will only be considered for retroactive approval where:

a. Emergency treatment or treatment of an acute medical condition was necessary; or

b. Due to other exceptional circumstances, there was insufficient time or opportunity for the Athlete to submit, or for the TUEC to consider, an application for the TUE prior to Sample collection; or

c. It is agreed, by WADA and by the Anti-Doping Organization to whom the application for a retroactive TUE is or would be made, that fairness requires the grant of a retroactive TUE.

Cyborg admitted to using Spironolactone since September 2016 and apparently did not disclose this to USADA until some time after December.  Given this it is hard to understand how she meets the above test.

This test is not expressly referenced in the UFC/USADA custom tailored anti-doping policy. I have written to USADA for clarity on whether this or another test applies and will update this article if/when they reply.

Today USADA published a press release advising of changes to the UFC/USADA anti-doping policy which come into force in April, 2017.

The new policy can be found here.

USADA summarized the changes as follows:

Policy Changes 2.1.5 – Limited Conditions for No Violation

In the event an Athlete entering the Program voluntarily and promptly discloses to USADA, prior to testing by USADA, the Use or Attempted Use of a substance or method that is prohibited at all times on the Prohibited List, then the presence or evidence of Use of such disclosed substance or method in an Athlete’s Sample, shall not be considered an Anti-Doping Policy Violation if it is determined by USADA to have resulted from Use of the Prohibited Substance or Prohibited Method which occurred prior to the Athlete entering the Program.

2.5.2 – Expands Tampering Definition

Absent a compelling justification, the failure to disclose to USADA, prior to entering the Program, the Use, Attempted Use or Possession within the previous one year of a substance or method that is classified as prohibited at all times on the Prohibited List. The past Use, Attempted Use or Possession of a Prohibited Substance or Prohibited Method shall not constitute a violation of these Policies if disclosed prior to entering the Program; however, the admission of such conduct shall subject the Athlete to the notice period requirements outlined in Article 5.7.4. Furthermore, unless the Athlete’s use of the substance or method in question was pursuant to a valid medical prescription or recommendation, such conduct may also be considered in sanctioning or counted as a violation for purposes of Article 10.7 if the Athlete subsequently commits an Anti-Doping Policy Violation.

2.9 – Expands Complicity Definition

Assisting, encouraging, aiding, abetting, conspiring, covering up or any other type of intentional complicity involving (a) an Anti-Doping Policy Violation, Attempted Anti-Doping Policy Violation or violation of Article 10.12.1 by another Person; or (b) conduct committed by an individual who is not subject to this Policy, which would otherwise have constituted an Anti-Doping Policy Violation.

5.7 – Notice Requirements for New and Returning Athletes


An Athlete who has not previously competed in UFC, may not compete in UFC Bouts until he/she has executed a Promotional Agreement with UFC and made him/herself available for Testing for a minimum period of one month before his/her first UFC Bout. Where the conditions set forth in Article 5.7.6 below are satisfied, the foregoing rule shall not prevent a new UFC Athlete from participating in a Bout less than one month after entering into a Promotional Agreement with UFC.


An Athlete who ceases to have a contractual relationship with UFC due to UFC-Initiated Inactivity, may not resume competing in UFC Bouts until he/she has entered into a new Promotional Agreement with UFC and has made him/herself available for Testing for a period of one month before returning to competition. Where the conditions set forth in Article 5.7.6 below are satisfied, the foregoing rule shall not prevent a returning UFC Athlete from participating in a Bout less than one month after entering into a new Promotional Agreement with UFC.


An Athlete who gives notice of retirement to UFC, or has otherwise ceased to have a contractual relationship with UFC due to Athlete-Initiated Inactivity, may not resume competing in UFC Bouts until he/she has given UFC written notice of his/her intent to resume competing and has made him/herself available for Testing for a period of six months before returning to competition. UFC may grant an exemption to the six-month written notice rule in exceptional circumstances or where the strict application of that rule would be manifestly unfair to an Athlete.


A new or returning Athlete who admits or has an established and verifiable history of the Use, Attempted Use or Possession of a substance or method that is classified as prohibited at all times on the Prohibited List shall not be permitted to compete in UFC Bouts until he/she has made him/herself available for Testing for a minimum period of six months before competing. At USADA’s discretion, such Athletes may also be required to provide a minimum of two negative Samples during the minimum six-month notice period before being cleared for competition. This provision shall not apply in situations in which (i) the Athlete’s Use of the Prohibited Substance or Method was pursuant to a valid TUE or (ii) USADA subsequently grants the Athlete a TUE for the substance or method in question.


If an Athlete retires from UFC competition while subject to a period of Ineligibility, the Athlete shall not resume competing in UFC Bouts or competitions approved or sanctioned by an Athletic Commission until the Athlete has given six months prior written notice (or notice equivalent to the period of Ineligibility remaining as of the date the Athlete retired, if that period was longer than six months) to UFC of his/her intent to resume competing and has made him/herself available for Testing throughout the notice period. Similarly, if an Athlete is retired at the time a period of Ineligibility is imposed, then the Athlete’s sanction shall be tolled until such time he/she provides written notice of his/her return from retirement and makes him/herself available for Testing.


The one-month notice period requirement for an Athlete subject to Articles 5.7.1 and 5.7.2 shall be waived automatically where he/she is named to a Fight Card as a replacement for an Athlete who was withdrawn from the Fight Card due to loss of eligibility, injury or other event not reasonably foreseeable to UFC.

7.7.2 – Scope and Purpose of Provisional Hearing

Provisional Hearings shall be conducted by a single Arbitrator and heard via conference call within the time frame specified by USADA. The sole issue to be determined by the Arbitrator at such a hearing will be whether USADA’s decision that a Provisional Suspension should be imposed shall be upheld.

USADA’s decision to impose a Provisional Suspension shall be upheld if probable cause exists for USADA to proceed with a charge of an Anti-Doping Policy Violation against the Athlete. It shall not be necessary, however, for any B Sample analysis to have been completed in order to establish probable cause. – Athletic Commission Violations

Decisions made either before or after the effective date of this Policy by an Athletic Commission or other Anti-Doping Organization, finding that an Athlete or other Person violated a rule involving Prohibited Substances or Prohibited Methods or committed an Anti-Doping Policy Violation may be considered in sanctioning or counted as a violation under this Article where the process was fair and the violation would also be a violation of these policies. Where such offense would not also constitute a violation under this Policy, then the offense shall not count as a violation for purposes of Article 10.7.

23.2 – Determining Which Rules Apply

With respect to any Anti-Doping Policy Violation case which is pending as of the Effective Date and any Anti-Doping Policy Violation case brought after the Effective Date based on an Anti-Doping Policy Violation which occurred prior to the Effective Date, the case shall be governed by the substantive antidoping rules in effect at the time the alleged Anti-Doping Policy Violation occurred unless the current rules would be more beneficial to the Athlete or other Person and the panel hearing the case determines that the circumstances of the case warrant the application of those rules.

New and Revised Definitions

In Competition

For purposes of this Anti-Doping Policy, “In-Competition” means the period commencing at noon on the day prior to the scheduled start of the Fight Card on which a Bout is contested and ending upon the completion of the postBout Sample or Specimen collection. If a post-Bout Sample or Specimen collection is not initiated by USADA within a reasonable time, which will not exceed one hour following an Athlete’s post-Bout medical clearance, then the In-Competition period shall expire at that time.


An Athlete shall be considered inactive due to UFC-Initiated Inactivity when the Athlete no longer has a contractual relationship with the UFC due to the termination of the Promotional Agreement by UFC or refusal by UFC to renew or otherwise continue the contractual relationship with Athlete upon the expiration of the Promotional Agreement.

Professional of Sport Related Capacity

Acting in a Professional or Sport Related Capacity shall include, without limitation, acting as a manager, coach, trainer, second, corner man, agent, official, medical or paramedical personnel. For purposes of this Policy, it shall not include indirect or peripheral involvement in an Athlete’s training, or acting as an Athlete’s training partner.

Today the British Columbia Athletic Commission released a position paper confirming that all of the changes to the unified rules adopted by the ABC at the 2016 convention are not being adopted.

The paper also suggests these will not likely be adopted in much of Canada noting “as a member of Federal/Provincial/Territorial Athletic Commission, BCAC has committed to abide by uniform standards within Canada“.  It is worth pointing out, however, that MMA standards currently are anything but uniform across Canada.

Specifically BC will not be allowing heel strikes to the kidney from guard and also will not adopt the new definition of a grounded fighter.

This should be of no surprise because BC, by regulation, adopts New Jersey’s rules.  New Jersey was a vocal but minority objector to the above changes.  Since New Jersey did not adopt these rules BC by default does not unless there is regulatory change which, based on BC’s position paper, does not appear forthcoming.  Below is BC’s full position –



Holly Holm Appeals UFC 208 Loss

Posted: February 15, 2017 in Uncategorized

Update February 28, 2017 – The NYSAC dismissed Holm’s appeal


As first reported by MMAFighting, Holly Holm is appealing her UFC 208 loss.

In short Holm argues that she was repeatedly fouled by late blows and the referee erred in failing to deduct points from her opponent.

The issue Holm will face is the deduction of points for fouls is a discretionary task and appeals based on the exercise of discretion rarely succeed.

Below is Holm’s full appeal –




Update February 16, 2017 – Today Marc Raimondi reports that GSP is indeed not currently in the USADA testing pool.


Also noteworthy are the UFC/USADA’s updates to the anti doping policy revealed today which could shelf GSP for up to 6 months if his return is not finalized before April 1 absent the UFC playing the ‘exceptional circumstances’ card.  Specifically GSP would be caught by s. 5.7.3 of the new policy which reads as follows:


An Athlete who gives notice of retirement to UFC, or has otherwise ceased to have a contractual relationship with UFC due to Athlete-Initiated Inactivity, may not resume competing in UFC Bouts until he/she has given UFC written notice of his/her intent to resume competing and has made him/herself available for Testing for a period of six months before returning to competition. UFC may grant an exemption to the six-month written notice rule in exceptional circumstances or where the strict application of that rule would be manifestly unfair to an Athlete.


Today Ariel Helwani reports that “St-Pierre, the former UFC welterweight champion, is on the verge of signing a new multi-fight contract with the promotion, multiple sources confirmed with MMA Fighting.”

If true the next question is timing and a key analysis will be whether he will be shelved for 4 months due to the UFC/USADA anti doping protocols.

Section 5.7.1 of the policy requires athletes who “ceased to have a contractual relationship with UFC, may not resume competing in UFC Bouts until he/she….has made him/herself available for Testing for a period of four months before returning to competition.”

As was learned from the high profile Brock Lesnar affair, the UFC has discretion to waive this requirement in “exceptional circumstances” a phrase that is not defined.  When the period was waived for Lesnar who then committed an anti-doping violation, the UFC and Lesnar were hit with litigation.

GSP never used the word retirement and when negotiations to return heated up in 2016 he entered the USADA testing pool.   The former welterweight champ was tested in August or September of 2016 but in October announced that he was no longer under UFC contract and “I’m a free agent.”.  He has not been tested since.


While the UFC never accepted GSP’s position his announcement may sideline him for months.  USADA’s testing powers come to an end  with “the termination of (a fighters) contract with UFC“.

Earlier this year the UFC noted that they are tweaking the policy to take away waivers of this period for “athletes who chose at their discretion to be removed from the RTP” and that such athletes “will be required to have an extended presence in the RTP before returning to competition”.

GSP appears to meet this definition.

After a scheduled heavyweight world title bout between Alexander Povetkin and Deontay Wilder was cancelled due to Povetkin testing positive for Meldonium the parties turned to the judiciary.

ESPN reports that a jury in US Federal Court took just over 30 minutes to decide that Povetkin indeed ingested Meldonium after it became a banned substance exposing him to damages for the cancelled bout.

While doping often leads to regulatory and other administrative penalties, this civil lawsuit will serve as a valuable precedent and deterrent to others thinking of gaining advantage through illicit performance enhancing substances.  ESPN’s Senior Writer Dan Rafael reports as follows:

Povetkin admitted that he used meldonium but said it was before it was banned. His argument was that whatever meldonium was in his system was left over from when he used it in August and September 2015, when it was still legal under WADA code.

But the jury accepted Wilder’s argument that Povetkin must have used meldonium after it was added to the banned list because he tested negative in random VADA doping tests conducted on April 7, April 8 and April 11 before an April 27 sample tested positive.

“We won the case, and this is an important precedent in cases of this nature when a fight is canceled for PED use,” DiBella told ESPN. “The other participant in the fight has gone through all the work. Deontay was ready to fight, and this got canceled right before the fight. This ruling is a further disincentive for any fighter to attempt to get an unfair advantage. Our attorneys, Judd Burstein and Peter Schalk, did a tremendous job because this is somewhat complicated and scientific.

“Basically, it’s a great thing about our justice system that where the facts are on your side and you’re telling the truth, you win.”

DiBella said he was confident the defamation case would soon be dropped.

“I also think it’s a good bet that I don’t have much to worry about with their defamation claim, which was based on my saying Povetkin is a cheater,” DiBella said. “The jury said he is a cheater. I think it’s very telling that the jury only deliberated for slightly longer than 30 minutes.”


(Image via the UG)

I have written many times that amateur combative sports not on the “programme of the International Olympic Committee” are illegal in Canada unless Provinces pass laws specifying otherwise pursuant to the powers given to them by s. 83 of the Criminal Code.

Despite this reality some Provinces have failed to enact appropriate laws and turn a blind eye to illegal combative sports.  Quebec and Ontario are perhaps the most noteworthy examples.  This leaves local promoters with a tough choice, they can let their competitors secure a stranglehold on the marketplace or risk criminal prosecution if they choose to participate in the sports as well.

One Quebec based promoter, perplexed by the apparent discrepancy has pressed the Government for an answer about whether any organizations have received proper legal authority to oversee amateur kickboxing and muay thai events in La belle Province.

In short the Government replied “No”!.

Here is the Ministry’s full reply (crudely translated via Google)

To date, the Lieutenant Governor in Council of the Province of Quebec has not designated any sport or permitted any combat sport games as permitted by section 83 of the Criminal Code. For the purposes of paragraph (a), I would point out that karate is a combat sport covered by the International Olympic Committee (IOC) program for the Tokyo Games in 2020.

In Quebec, work is continuing on government intervention using the powers of the provinces under section 83 of the Criminal Code.

Cordial greetings,

Michel Fafard

Director of Safety Promotion Recreation and Sports Sector Ministry of Education and Higher Education

100 Laviolette Street, Suite 213 Trois-Rivières, Quebec G9A 5S9

Phone: 819-371-6033 or 1-800-567-7902, ext. 4434 or 4425

Fax: 819-371-6992 Email: Web site:

Like Ontario, Quebec recognizes various Provincial Sport Organizations including some involved in combative sports.  A PSO that is ‘recognized’ by the Government is basically in a position to receive public funding. Recognition does little more than this and does not meet the clear requirements for legalization set out in the Criminal Code.

It is also interesting that the reply suggests amateur Karate contests are ok.  Karate is on the IOC’s program for the upcoming Tokyo Olympics on a provisional basis.  If Quebec’s interpretation is accurate then, as previously discussed, amateur Karate contests are legal Canada wide with the exception of Provinces that have passed laws specifying otherwise.


Adding to this site’s archived posts addressing combat sports piracy, reasons for judgement were released recently by the US District Court, ND Texas, Dallas Division, awarding damages of $20,000 for the commercial piracy of UFC 162.

In the recent case (Joe Hand Promotions, Inc. v. 2 Tacos Bar and Grill) the Defendant displayed UFC 162 without paying the Plaintiff the commercial sub licencing fee which would have been $1,300.  The Plaintiff sued and obtained default judgement.  Joe Hand sought $60,000 in total damages but the Court refused finding $20,000 sufficient in the circumstances. In reaching this assessment Chief District Judge Barbara M. G. Lynn provided the following reasons:

The uncontroverted evidence indicates that there were 70 patrons at 2 Tacos at the time of the violation. ECF No. 15-5 at 1. Plaintiff’s rate card for the Event further indicates that for a maximum occupancy of 165 people, the capacity of 2 Tacos, it would have cost $1,300 to legally broadcast the Event. ECF No. 15-4 at 1. The Court finds it reasonable, therefore, to award base statutory damages in the amount of $5,000. See Beck, 2013 WL 5592333, at *2 (“[T]o adequately deter piracy, the cost of piracy must be significantly higher than the cost of buying a license.”).

The Court concludes that 2 Tacos and Hinojosa acted willfully. Given “the limited methods of intercepting closed circuit broadcasting of pay-per-view events and the low probability that a commercial establishment could intercept such a broadcast merely by chance,” courts have held that conduct such as that of 2 Tacos and Hinojosa in this case to be willful and for the purposes of commercial advantage. E.g., Al-Waha Enters., 219 F. Supp. 2d at 777 (citing cases); Beck, 2013 WL 5592333 (“[I]t is obvious that commercial establishments show sports programs to draw business, not out of charity.”). However, the Court notes that there was no cover charge imposed to attend the Event, and Plaintiff does not allege that 2 Tacos was a repeat offender in broadcasting the Event. Taking those facts into consideration, therefore, the Court in its discretion will only award total damages of $15,000, or three times the base award amount. Al-Waha, 219 F. Supp. 2d at 766 (awarding treble damages in a similar case); Beck, 2013 WL 5592333 (same); see also Alima, 2014 WL 1632158, at *5 (awarding four times the base statutory damages in additional damages when a cover was charged to view the unauthorized broadcast). Plaintiff is thus entitled to a statutory damages pursuant to 47 U.S.C. § 605(e)(3)(C)(i)(II) from 2 Tacos and Hinojosa, jointly and severally, in the amount of $5,000 and additional damages pursuant to 47 U.S.C. § 605(e)(3)(C)(ii) from 2 Tacos and Hinojosa, jointly and severally, in the amount of $15,000. Plaintiff is entitled to total damages in the amount of $20,000.

This week a lawsuit alleging that Al Haymon and the Premier Boxing Championships were conducting business in an anti-competitive way was dismissed by the US District Court, Central District of California.  For a great breakdown of this decision along with what it may mean for the UFC anti-trust lawsuit I recommend this piece by Paul Gift.

One interesting development are the Court’s comments on the scope of the Ali Act -legislation which rarely receives judicial scrutiny.

The Plaintiff promoter alleged that one of the anti-competitive actions of the Defendant promoter was acting as as both a manager and promoter in violation of the Ali Act.  The court found that even if this allegation was true it was of no assistance as the Ali Act can only aid boxers and government agencies.  Other promoters simply do not have standing to allege harm.  In dismissing this aspect of the Plaintiff’s claim District Judge John Walter provided the following reasons:

Plaintiffs contend that Defendants have violated the Ali Act by acting as both a manager and promoter of Championship-Caliber Boxers, and that this violation has given Defendants an unfair advantage over their competitors. The Ali Act, enacted in 2000, requires a “firewall” between managers and promoters. It makes it unlawful for “a promoter to have a direct or indirect financial interest in the management of a boxer;” or “a manager—(i) to have a direct or indirect financial interest in the promotion of a boxer; or “(ii) to be employed by or receive compensation or other benefits from a promoter, except for amounts received as consideration under the manager’s contract with the boxer.” 15 U.S.C. § 6308.

A plaintiff may only pursue an antitrust action if it can show “antitrust injury,” i.e., “‘injury of the type the antitrust laws were intended to prevent and that flows from that which makes defendants’ acts unlawful.’” Atl. Richfield Co. v. USA Petroleum Co., 495 U.S. 328, 334 (1990) (quoting Brunswick v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 489 (1977)). The four requirements for antitrust injury are: “(1) unlawful conduct, (2) causing an injury to the plaintiff, (3) that flows from that which makes the conduct unlawful, and (4) that is of the type the antitrust laws were intended to prevent.” Am. Ad Mgmt., Inc. v. Gen. Tel. Co. of California, 190 F.3d 1051, 1055 (9th Cir. 1999).
“Injury of the type antitrust laws were intended to prevent” means harm to competition, not harm to individual competitors. See Brunswick, 429 U.S. at 488 (quoting Brown Shoe Co. v. United States, 370 U.S. 294, 320 (1962)) (“The antitrust laws . . . were enacted for ‘the protection of competition not competitors.’”).

Plaintiffs cannot establish antitrust injury based on alleged violations of the Ali Act because the only parties with standing to assert a violation of the Ali Act are boxers or government agencies. See 15 U.S.C. § 6309(a). As such, any alleged harm to Plaintiffs would not “flow[ ] from that which makes defendants’ acts unlawful.” Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477, 489 (1977).  Indeed, the specific provision that Plaintiffs claim that Defendants violated, 15 U.S.C. § 6308, was intended to protect boxers from promoters and managers. As the Senate Report states:

The final protection for boxers established in this section is the prohibition of conflicts of interests between promoters and managers. Most boxers have limited educational backgrounds and, as the top promoters in the sport readily concede, are no match for experienced promoters during contractual discussions. While the role of managers has been diminished in the sport over the last decade, it remains essential that managers, if a boxer does hire a manager, that the manager serve and protect the interests of the boxer. They should not be serving the financial interests of the promoter, while simultaneously taking a 33% earnings cut from the boxer for biased representation as manager. It is not plausible for a boxer to receive proper representation and counsel from a manager if the manager is also on the payroll of a promoter. This is an obvious conflict of interest which works to the detriment of the boxer and the advantage of the promoter. The Committee received testimony about instances wherein boxers had suffered significant career and economic injury due to their manager’s clear conflicting interests. A manager must be a determined advocate for the boxer’s interests and not be influenced by financial inducements from a promoter. This provision tracks a similar regulation of many State boxing commissions.

S. REP. 106-83, at 11 (1999). The Court concludes that the conflict of interest provision in the Ali Act was not intended to compensate promoters for lost profits.

Moreover, absent some other antitrust violation (such as tying, exclusive dealing or predatory pricing), Plaintiffs’ claimed injury as a result of the Defendants’ alleged violation of the Ali Act would be exactly the same as if a new competitor entered the promotion market. In other words, Plaintiffs’ injury was caused by conduct that was beneficial to competition in the promotion market. “If the injury flows from aspects of the defendant’s conduct that are beneficial or neutral to competition, there is no antitrust injury, even if the defendant’s conduct is illegal per se.” Rebel Oil, 51 F.3d 1433.

Accordingly, the Court concludes that Plaintiffs have failed to demonstrate the requisite antitrust injury as a result of Defendants’ alleged violations of the Ali Act.

The full decision can be found here – golden-boy-v-haymon-full-summary-judgement