We have an update in the UFC anti-trust lawsuit. Recently, our own John S. Nash provided details on what happened after Judge Boulware certified the Le vs Zuffa (UFC) anti-trust lawsuit as a class action. Per Nash, the UFC appealed the class action certification to the Ninth Circuit.
A month or so after the appeal went to the Ninth Circuit, we have an answer to it.
Jason Cruz of MMA Payout tweeted the news:
What does this latest update mean for the UFC?
Paul Gift has some instant analysis via Twitter (sorry X.com).
“This sure looks like #UFC petition for permission to appeal class cert just got DENIED (last paragraph). Maybe an attorney should confirm. That would mean 2024 trial is ON unless Judge B somehow sides with them in summary judgment.
“And Judge B just pushed back deadlines to submit unsealed #UFC antitrust record & for summary judgment. While you might be tempted to think this delays trial since judge is super slow for written orders, he’s probably gonna shoot down #UFC summary judgement w/ haste. Bring on trial!”
John Nash has some insight about the political backgrounds of the deciding judges on the 9th circuit:
“For those curious Fletcher was appointed by Clinton & Bennett by Trump.”
What happens from here?
The plaintiffs are seeking between $800 million and $1.6 billion in damages from the UFC. That’s a big chunk of change, especially in light of how little the UFC’s owners have liked sharing money with the athletes.
As John Nash reported for Bloody Elbow a few months back, Endeavor (the UFC’s parent company before they bought the WWE and merged it with the UFC to form TKO) enjoyed record profits while paying fighters less than ever.
“…the UFC made a whopping $1.14B in revenue last year with around $800M in media rights/content deals. According to the filings, they cut $32.8M in fighter costs/pay from 2021 to 2022, paying out just $146M out of $1.14B (down from $178M in 2021), despite revenue increasing by $110M and net income by $120M.
“When the UFC-WWE merger was announced, a new $12B+ valuation of the UFC came out, which is 3x the value of its 2016 sale (that clocked in at a little over $4B). The fighters are now receiving significantly less revenue than ever before, and the UFC is raking it in.”
Considering that the 9th Circuit’s ruling puts the case back in the hands of Judge Richard F. Boulware the UFC might look to settle this in short order.
Judge Boulware agrees with the plaintiffs on many key points
Boulware tipped his hand in his certification of the class action suit earlier this year.
The Court found themselves in agreement with the plaintiffs that the Ultimate Fighting Championship “willfully engaged in anticompetitive conduct to maintain or increase their market power” in the industry.
”This was mainly accomplished in three ways: first, through the enforcement of exclusionary contracts, which kept fighters “locked up” in an anticompetitive manner; second, through extracontractual methods to make fighter contracts effectively perpetual; and third, through acquisition and shutting down of rivals.”
“Court finds that Plaintiffs have established that these forms of anticompetitive conduct, both individually and collectively, along with dominant output market power, allowed Defendant to exercise substantial monopsony power over putative class members in the input market for fighter services. Ultimately, the Court finds, for the purposes of class certification, that Plaintiffs have set forth sufficient evidence that this Scheme amounted to a violation of the antitrust law.”
The Court also agreed with the plaintiffs that the UFC used a “variety of ruthless coercive techniques to prevent fighters from becoming free agents— rendering these contracts effectively perpetual.”
The Court noted how the UFC “maintained significant control over a fighter’s career” through various means.
“Because Zuffa fighters did not get paid unless they fought, this enabled Zuffa to use various strategies related to the timing, placement, number and opponents of a fighter’s bouts to coerce fighters into renewing their contracts early or extending their contracts in order to earn a paycheck.”
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