Fedor & M-1 klagen Affliction (en wellicht UFC) aan!

[ataraxia]

Van bloodyelbow:



On October 28, 2009, M-1 and Fedor Emelianenko filed a lawsuit against Affliction Clothing, Affliction Entertainment, and 50 unnamed John Does in the Central District of California. The complaint states claims for breach of contract, breach of the violation of good faith and fair dealing, and declaratory relief. If they are able to join other parties, the complaint might be amended to include claims for tortuous interference with contract and related claims.

There are likely many targets among the unnamed John Does, but the UFC has to be considered the central target based on language of the complaint. After reading the complaint, it seems possible that M-1 believes the UFC was somehow involved in the cancellation of Affliction’s third show.

The complaint alleges that Strikeforce, Affliction, and M-1 reached an agreement with M-1 to allow Brett Rogers to fight Fedor Emelianenko at Affliction: Trilogy, but unbeknownst to Fedor and M-1, Affliction was simultaneously working on a renewed sponsorship deal with the UFC that would necessarily force Affliction out of the MMA promoting business. In short, the complaint alleges that Affliction was putting up a false front about searching for a replacement for Josh Barnett, and was simply buying time while they were trying to make a deal with the UFC.

The complaint alleges that Affliction kept these negotiations secret in an attempt to fool M-1 into believing they were looking for a replacement, and did not inform M-1 of its ongoing negotiations and new deal until July 24, 2009, at which point Fedor and his party of 30 had already boarded a flight from Russia to the United States.

The complaint alleges that the deal to allow Brett Rogers to fight Fedor Emelianenko on Affliction: Trilogy was completed the day before the show was cancelled, and alleges that Affliction was simultaneously pursuing two incompatible options: if the UFC deal closed they would cancel the show, and if it didn’t they would promote Brett Rogers vs. Fedor Emelianenko.

The complaint alleges that after conducting full discovery, M-1 and Fedor will amend the complaint to add “additional allegations, causes of action, and parties.”

The complaint alleges that in the run-up to Affliction: Trilogy M-1 began working on international deals to broadcast the show in Mexico, Central America, the Caribbean, South America, Eastern Europe, the United Kingdom, Australia, and elsewhere. The complaint details all of the deals M-1 entered into at length.

The complaint alleges Affliction was well aware this was going on all along and consented to it by not objecting. Because Affliction was supposedly aware of all of this, M-1 argues Affliction knew it would force M-1 to breach its contract with all of its international partners if it cancelled a show.

The complaint alleges that Todd Beard admitted to M-1 that Affliction could not and would not promote internationally, and agreed to allow M-1 to pursue all such opportunities with Affliction content. The change was not put into writing. This issue of modification appears to be a major issue of contention based on the complaint. Affliction will try to argue that M-1 changed the contract by pursuing rights not originally granted to it. If the court does not find that the contract was modified, Affliction cannot be held responsible for breach because M-1 went all over the world and did a number of international deals on their own.

In addition to the central claims described above, the complaint contains a lot of interesting information. The complaint alleges that in addition to the $300,000 fight purse, Emelianenko was paid an undisclosed sum that is not quantified in the complaint. The complaint also alleges that Affliction and M-1 Global entered into a “consulting agreement” in which Affliction paid M-1 a “substantial sum” in return for general consultant services.

The complaint alleges that Affliction and M-1 entered into an agreement in 2008 under which M-1 promised to produce a number of one-hour television episodes of “M-1 Challenge” and Affliction agreed to sponsor a number of the fighters. The terms of the deal are not disclosed. The complaint alleges that M-1 agreed to give Affliction promotional advantages relating to M-1 challenge including but not limited to use of the Affliction logo in marketing. In exchange for these promotional rights, Affliction agreed to pay M-1 a “substantial sum” that is not mentioned in the complaint.

Mark Hines, who is the lawyer representing M-1, also represented Silver Star against Affliction and Todd Beard in a state case earlier this year.

It is also worth noting that the complaint does not list Donald Trump or any of his entities as owners of Affliction Entertainment. Todd Beard is also still listed as an owner of Affliction and Affliction Entertainment in the complaint, which is contrary to prior public statements.

The big story to look at going forward is whether the UFC is eventually added as one of the Doe defendants in the complaint. The language of the complaint suggests that M-1 believes the UFC was involved in a conspiracy to convince Affliction to breach its contractual obligation to put on a third show.

[missj]

Was er niet al eens zoiets ,waar Fedor ook de Ufc wilde aanklagen?
Meen eens iets gelezen te hebben daarover.

[thefxr]

Denk dat dit een dead end wordt!

[chief108]

Viva La Resistance!!

sue the fuckers...

[iconian]

sue. pretty pretty pretty pretty peggy sue oh ho peggy. my pehegy sue u u

[Socra]

Bloodyelbow, again:

Exclusive: Details of Fedor Emelianenko's Affliction Contract and M-1's Consulting Agreement

Affliction_mediumNote: All information in this post was obtained via Affliction's motion to dismiss filed on November 6, 2009. It is all public information and can be obtained through the Pacer system.

David Wolf of MMA Payout broke the story earlier today that Affliction filed its motion to dismiss in response to the M-1 lawsuit I discussed on Bloody Elbow last week. Needless to say, a motion to dismiss is just a standard response in a lawsuit by the defense. I will have more thoughts on the motion to dismiss next week on Bloody Elbow, but my initial thought is that I'm baffled as to why a 12(b)(6) focused so much on the facts instead of the law. A 12(b)(6) motion is a motion to dismiss for failure to state a claim for which relief can be granted, it is not a motion related to factual disputes.

The most interesting part of the filing is Affliction's disclosure to the courts of its agreements with Fedor Emelianenko and M-1 Global. They disclosed the promotional agreement as well as the "consulting agreement." According to the initial M-1 filing there was a third consulting agreement related to the M-1 Challenge TV show, but as far as I can tell that agreement hasn't been disclosed.

Below I'll go through the promotional agreement's essential terms and add my comments in italics where I feel anything additional is warranted.

The Promotional Agreement.

--Fedor is to be paid a $300,000 purse per fight.

--The contract arranges for four first class tickets and three coach tickets from St. Petersburg to wherever the fight is. It also arranges for four first class hotel rooms for up to five nights, round trip transportation on the ground, and meal allowances. This section is more extravagant than equivalent UFC contract provisions for its top stars.

-- The contract calls for three fights under the Affliction banner, and makes Affliction the exclusive home of Fedor fights in the United States. However, the contract states that any fight between Fedor Emelianenko and Randy Couture is excluded from the contract and can take place elsewhere. It's clear that when this contract was signed Fedor and M-1 were still shopping around a potential Couture fight incase he ever got out of his contract. This also further confirms that Affliction never had the rights to this fight.

--The contract states that it ends on the earlier of two dates: March 31, 2009 or after Fedor's last fight, unless the contract is extended. This will be a serious litigation battleground; M-1 will argue that Affliction extended the contract by promoting a third show. I find this argument fairly convincing.

--Affliction agreed to make all efforts to feature a M-1 logo on the mat. Fedor was allowed to choose any sponsor as long as there was no conflict with Affliction.

--Fedor Emelinaenko reserved all rights to distribute and exploit his bouts in Russia and Asia. He had the right to retain all revenue from the sale, license, or any other exploitation of his reserved rights to market the broadcast. There are other specifics regarding Affliction's responsibility to provide Fedor and M-1 with a high definition feed. The rights include streaming rights, and extend beyond Fedor's fights to the undercard and preliminary fights. You can imagine the UFC would never agree to such a term.

There are a number of other important and interesting terms, but those are the essential ones.

The Consulting Agreement

--M-1 was to provide consulting on all the following topics: International bout consulting, international television, fighter scouting, location for future bouts recommendations, television-related opportunities, international sponsorships, and bout tourism.

--M-1 was also required to fully cooperate and assist in the advertising and promotion of each fight.

--In exchange for these consulting services, Affliction agreed to pay M-1 a consulting fee of $1,200,000 per fight.

--Affliction was required to promote the M-1 Global brand through promotional activities including: Articles in event programs, M-1 Global's logo incorporated into Affliction advertising, M-1 logo recognition with event advertising, public address announcements during the bouts, the airing of M-1 videos announcements during events, and the creation and sale of co-branded M-1 and Affliction event posters.

I believe there is still one more consulting agreement out there based on my reading of M-1's lawsuit, but Affliction did not disclose it here. Just counting these two agreements, Fedor Emelianenko received $300,000 per fight while M-1 Global received 1.2 million. Fedor Emelianenko is a 20% owner of M-1 Global.