By Zach Arnold | June 10, 2016
When the Attorney General’s office in Nevada overcharged California fight promoter Roy Englebrecht with perjury, forgery, and ID theft, they publicly stated at a Nevada State Athletic Commission that they wanted to send a message to other states to follow suit against Englebrecht and hopefully enforce their suspension of the California promoter.
Englebrecht is one of the few local California fight promoters left on the state’s scene. He’s worth good money each year to the California State Athletic Commission. He runs Fight Promoter university and often has people associated with the state’s Athletic Commission at Fight Promoter U. His events are often social gatherings for those working on behalf of CSAC.
Which is exactly why the California State Athletic Commission is ignoring Nevada’s 18-month suspension of Roy Englebrecht after he admitted to providing false and misleading information when he filed a fighter application on behalf of boxer Zab Judah. California is under no legal obligation to honor promoter suspensions from under states, unlike fighters and other licensees as required by the Ali Act. And, naturally, they’re telling Nevada to go pound sand without saying a word.
Englebrecht ran an event at his home base of The Hangar in Costa Mesa, California on Thursday. There is absolutely no sign that California will administratively enforce Nevada’s suspension or bring up the topic at their next Athletic Commission meeting on July 12th in Los Angeles.
California’s decision to ignore the wishes of the Nevada State Athletic Commission and the state’s AG office is a fascinating political decision. Andy Foster, if nothing else, is a political animal. He ran for the open Executive Director slot in Nevada and got beat out by Bob Bennett. Now Andy is ignoring the wishes of Bennett by not enforcing Nevada’s suspension in California. The tension will escalate between the two parties. The decision to ignore Nevada’s suspension of Englebrecht now sets a precedent in the relationship between both men that should California need a favor in the future, don’t expect Las Vegas to pick up the phone and answer.
There is an interesting administrative law discussion to be had regarding the Department of Consumer Affairs, the powerful Sacramento entity which oversees the state Athletic Commission, ignoring Nevada’s perjury suspension of Roy Englebrecht. Perjury is considered an act of moral turpitude and DCA uses acts of moral turpitude all the time to revoke licenses from state professionals for DUI convictions, domestic violence charges, forgery, and (yes) perjury. These state professionals often include doctors, attorneys, notaries public, contractors, and liquor licensees. If you run a restaurant and lose your liquor license, it can be economic death. I could write a formal treatise citing the various license revocation cases DCA has pursued over the last decade.
The perjury laws in both California and Nevada are similar. California PC 118:
118. (a) Every person who, having taken an oath that he or she will testify, declare, depose, or certify truly before any competent tribunal, officer, or person, in any of the cases in which the oath may by law of the State of California be administered, willfully and contrary to the oath, states as true any material matter which he or she knows to be false, and every person who testifies, declares, deposes, or certifies under penalty of perjury in any of the cases in which the testimony, declarations, depositions, or certification is permitted by law of the State of California under penalty of perjury and willfully states as true any material matter which he or she knows to be false, is guilty of perjury.
Nevada Revised Statute 199.145:
NRS?199.145 – Statement made in declaration under penalty of perjury.??A person who, in a declaration made under penalty of perjury:
1. Makes a willful and false statement in a matter material to the issue or point in question; or
2. Willfully makes an unqualified statement of that which the person does not know to be true
Nevada’s perjury law is more liberal for interpretation than California’s but the end result is still the same. Roy Englebrecht admitted under oath that he “made a mistake” and did not contest the perjury charge in Nevada. California has little-to-no wiggle room in ignoring Nevada’s suspension by claiming that the perjury laws are somehow different between the two states.
DCA has revoked many California licenses on similar charges & circumstances, ending professional careers. They’ve chosen not to end Roy Englebrecht’s career as a promoter. He makes money for the state and his events are social gatherings for state employees. How Nevada exacts retribution upon California in future will be the next storyline to follow.
By Zach Arnold | June 7, 2016
Royce Gracie. Ken Shamrock. Brock Lesnar. Chuck Liddell. Kimbo Slice. That’s my top five list of fighters in the modern era who really excelled as influential business aces that advanced Mixed Martial Arts into mainstream North American sports & popular culture.
It’s a horribly difficult list to formulate. Tito Ortiz, Randy Couture, Georges St. Pierre, Ronda Rousey, Gina Carano, Rampage Jackson, and many others could easily be argued as a top five modern day MMA fighting pioneer.
It’s easy to be prisoner-of-the-moment while everyone is eulogizing Kimbo Slice after his death Monday night in South Florida at the age of 42. ESPN called him an internet sensation. The television network treated his death as the top headline Monday evening. Footage of his infamous backyard brawls aired on a television loop. Over 50,000 RTs for ESPN’s online announcement of Kimbo’s death. A non-stop flow of tributes from fighters, writers, managers, and promoters in Mixed Martial Arts about what a great guy Kimbo Slice was outside of the cage.
Kimbo Slice deserves to be called a legendary figure in Mixed Martial Arts for all the right and wrong reasons. There are very few fighters where fans genuinely care to watch their every single fight, regardless of skill level or opponent.
Take a step back and look at the last decade as Mixed Martial Arts transitioned into broadcast television in North America. Kimbo Slice was the ace of UFC’s rival promotion. Had Gary Shaw played his cards right and not burned through tens of millions of Pro Elite dollars, Elite XC could have seriously been a major long-term player. Kimbo Slice was delivering unbelievable numbers on CBS. He and Gina Carano were an amazing tag team. Shaw, in his own imitable way, understood how to market larger-than-life personalities.
For goodness sakes, Bellator was trying to promote an old Elite XC grudge match between Kimbo Slice and James Thompson next month in London.
The numbers Kimbo Slice drew on network television versus what UFC has (not) accomplished on Fox is a testament to his staying power and an indictment of what UFC & business partner Fox failed to capitalize on after Kimbo and Gina brought MMA to network television. Kimbo Slice was good for at least five million viewers on broadcast TV. By comparison, the Junior dos Santos fight with Cain Velasquez turned out to be a “disaster” because of how short it was. It drew six million viewers but spooked some powerful people and UFC’s foray into broadcast television has been lackluster since.
Even after the debacle involving the canceled fight between Kimbo Slice & Ken Shamrock giving us Smoothie King Seth Petruzelli, Kimbo Slice remained a big time lucrative name. UFC relied on him, Rashad Evans, and Rampage Jackson to refresh The Ultimate Fighter. Who could forget Houston Alexander? 3.7 million viewers! And when Kimbo Slice finally fought Ken Shamrock in Bellator in 2015, they still drew 2 million viewers.
For a backyard brawler without technical skill, fans sure cared a lot about the guy. They really cared. A modern day humble Mr. T come to life.
I’ll never forget his exhibition fight in Atlantic City. That was one of the rawest, most animalistic fight crowds ever to watch a fight. From the beginning of his professional career until his death, Kimbo Slice was the most beloved North American heavyweight ever in modern day Mixed Martial Arts. It’s absurd but true! To write that sentence 24 hours after the king of modern day MMA PPV, Brock Lesnar, returned to UFC is amazing.
Of the nine other potential names that could be in the proposed Top 5 modern day MMA fighting pioneers list, all of them were decorated & skilled fighters in one discipline or another. Kimbo Slice was a prize fighter who came to someone’s backyard and knocked them out. How much simpler can it get to market that circus?
Long before Dana White promised no women would be fighting in the Octagon, Dana White was promising that Kimbo Slice wouldn’t be able to last two minutes in UFC. Kimbo kept their reality TV show afloat and gave them two fights.
Kimbo’s career was a circus until the end. His last fight featured an opponent (Dada 5000) who nearly died afterwards. The overall Bellator event drew 2.2 millions and Kimbo’s fight drew 2.9 million viewers. Kimbo got busted for steroids and died shortly thereafter. It was a train wreck fight for Bellator but Viacom got exactly what they wanted. Kimbo delivered ratings all the way until the end.
Kimbo Slice’s staying power is historical in the North American MMA scene. Nobody else came close to the television ratings Kazushi Sakuraba drew in Japan, often in the 15-to-20 million viewership range. As a consistent television attraction, Kimbo Slice ranks first in North America and second globally as a ratings king in modern day MMA. He made himself, his promoters, and undercard fighters on his events a lot of money.
What a surreal scene it was on ESPN TV Monday night with the top two stories involving Kimbo Slice’s death and Ariel Helwani’s media pass fight with UFC management.
“Miami to the bone, fighter to the end. The first viral sports person.” — Dan LeBatard
The Ariel Helwani dilemma: Lawsuits & informants, not protests or unions, is how to fight UFC media policy
By Zach Arnold | June 6, 2016
UFC has profited yuge from their media tactics. It got them ESPN. The media has a 6% approval rating. It will worsen https://t.co/OSTUOllmwJ
— FightOpinion (@FightOpinion) June 5, 2016
There are two different stories coming out of UFC 199. In the world of general sports fandom, UFC 199 was a great event with Michael Bisping accomplishing his lifelong dream of becoming a UFC champion. In the world of general sports media, the UFC banning Ariel Helwani for life after he scooped UFC PR on Brock Lesnar’s return to MMA for a fight at UFC 200 is a big scandal.
In a Yahoo Sports article published on Sunday event, Helwani claimed that Dana White accused him on nearly ruining UFC’s deal with Lesnar because Lesnar was upset that the news got out early. Does this mean Dana White allegedly accused Helwani of potentially interfering with UFC’s prospective economic advantage by doing his job as a journalist?
If this wasn’t so laughable, I’d shed a tear. Regrettably, Helwani’s employer (SBNation) MMA Fighting released a short, terse statement regarding Saturday night’s incident. I give SBN the benefit of the doubt in terms of needing to do their own independent investigation to find out all the details as to what happened. I still believe that they should have stood up more aggressively on behalf of the face of their MMA web site.
Media outlets such as the CBC, the Washington Post, Deadspin, and Pro Football Talk have ran stories pushing back against the UFC for what they allegedly did to Helwani. NFL personality Rich Eisen questioned why UFC would go this far given that Helwani has an audience that supports their product. It’s great to see this kind of response but it’s about 10 years too late and will largely be chalked up by UFC’s rabid fan base as a case of the media doing what they do best — talking about each other and how important they are.
The UFC has managed to pull off a feat that very few sports or entertainment enterprises could ever do. They manage to get the big media entities like Fox Sports and ESPN to grovel at their every step while maintaining media control like an entertainment property such as WWE. They get the best of all worlds with their terrible behavior but it’s absolutely calculated to perfection. UFC doesn’t need writers to carry their water. That’s a mindset stuck in 2000. UFC is making hundreds of millions of dollars doing what they’ve always done. The price of “media” admission to a UFC event is a contract of sorts that you will do whatever they tell you to do in exchange for not having to pay for a ticket.
From UFC’s vantage point, any media member who doesn’t do what they say is in legal violation of the contract of getting a media pass. It’s purely a business transaction. I’m surprised UFC hasn’t sued media writers yet for breach of contract.
There is now reportedly an allegation that UFC supposedly “ordered” Fox to fire Ariel Helwani. That’s a very serious accusation to make. If it’s substantiated, Ariel must pursue a lawsuit for interference with contractual relations. If it’s unsubstantiated, UFC could easily pursue defamation options against Ariel. The clock is ticking. If the statute of limitations runs out, Ariel will forfeit any legal or moral right to complain about what supposedly happened to him. If he chooses to sue, however, he likely will be able to find an attorney who will take the case on contingency given a) the parties involved are high-profile and b) the potential defendants involved have a lot of money.
What UFC did to Ariel Helwani on Saturday night was clearly a signal that they do not fear him or his employer. They loathe his presence and find him irritating but they do not fear legal repercussions. This must change in the future.
By Zach Arnold | June 5, 2016
— WWE (@WWE) June 5, 2016
What was supposed to be a tepid Southern California UFC event turned out to make major news – for all the right and wrong reasons.
UFC & WWE announced that Brock Lesnar will fight at the UFC 200 event next month. It’s a one-off fight that benefits all the parties involved. Brock makes money, which keeps him happy. UFC gets a marketing bang for their UFC 200 event which needed some buzz from a UFC 100 legend. WWE gets to stay in the mainstream sports headlines and holds onto Lesnar loosely but doesn’t let go.
This news, along with news of a contract being signed to promote the Conor McGregor/Nate Diaz rematch, was broke by Ariel Helwani. Helwani, along with members of his MMA Fighting team for SBN, were credentialed for the UFC 199 event. They supposedly got the heave-ho before the main event and Helwani reportedly has been “banned for life” by UFC. This got Mr. Helwani trending on Twitter. Front Row Brian then publicly claimed that Helwani had been allegedly choked out by a UFC body guard at a prior event for asking certain questions. That’s a serious accusation to make.
All of this was the back-drop for a rather eventful UFC 199 fight card where large underdog Michael Bisping defeated Luke Rockhold by KO in 216 seconds to win the UFC Middleweight title. This now sets up a fight between Bisping and Jacare Souza. Bisping has reached the top of the mountain in the most circuitous way possible. Think about how far he has rebounded after that infamously brutal knockout by Dan Henderson at UFC 100. Henderson fought on Saturday’s night undercard and KO’d Hector Lombard.
Bisping and Rockhold had a wild public relations week heading into the fight and an unfortunate spat after the fight with some crude and course remarks. The Englishman had quite the interview on Fox Sports 1 this past Thursday where he joked that one of his kids may end up in a ditch. Rockhold nearly got his title fight canceled after claiming he had an MCL tear.
Dominick Cruz took care of business with an easy, unanimous decision win over Urijah Faber.
Cole Miller, who was supposed to face BJ Penn (before his USADA suspension due to IV usage), lost by unanimous decision to Bruce Leeroy. A rough business.
By Zach Arnold | June 2, 2016
When the Nevada State Athletic Commission told the public that big changes were coming after being transitioned from the state’s general fund to self-funding for budgetary purposes, they weren’t joking. A review of the 104-pages of proposed changes to the commission’s rules and regulations shows dramatic changes and cost increases for drug testing infractions, sanctioning of third party drug testing organizations, revisions in fighter/management contracts, questionnaire disclosures, bans on energy drinks, medical examinations, increased licensee fees, extra ambulances at fight events, electronic score cards, and more.
This is the 104-page document of proposed changes that are about to be implemented in three weeks. The changes are the work product of both the state’s Attorney General office and Pat Lundvall, the long-time attorney on the Nevada State Athletic Commission board.
I read the document carefully. It took me approximately two hours of undivided attention to digest. If you are an active licensee in Nevada, you must read this document. If you can’t, hire an attorney who can help you digest the information. The sweeping changes will dramatically impact the way business is handled in Nevada.
Nevada has long had a reputation of being promoter-friendly for all shows, big and small. These new changes are likely to drive away some club shows from the state. The changes will impact smaller promoters, although not on a scale as draconian as New York’s new combat sports bill which goes into effect in September.
One of the changes is to now characterize the Nevada State Athletic Commission administrative hearings as civil, not administrative, hearings.
NAC 467.936 “Hearings before the Commission are civil proceedings.”
For informational (and not legal) purposes, we have developed a summary of some of the major changes that Nevada is about to implement.
By Zach Arnold | May 31, 2016
Nothing sabotages trust faster than when a promoter tries to pull a fast one on administrators for an athletic commission.
Nevada went ballistic over Roy Englebrecht filling out a fighter application for boxer Zab Judah allegedly without identifying that he owed back child support of $275,000. Nevada threw the book at Roy and ended up with a compromise punishment of an 18 month suspension for perjury. This was important to note because perjury is considered an act of moral turpitude, which is often enough to kill your chances for holding onto a professional license for serving alcohol, doctor services, attorney services, and so on. California’s Department of Consumer Affairs, which oversees the state Athletic Commission, is notorious for hammering licensees over acts of moral turpitude.
The on-the-record response we received last Friday from Athletic Commission Executive Officer Andy Foster on whether or not he would honor Nevada’s suspension of Roy Englebrecht was interesting.
“I don’t have any comment at this time. We are still looking into this.”
There’s really not much to look into. Englebrecht admitted to providing false and misleading information to Nevada’s Athletic Commission. Nevada’s commission suspended him. The ball is in California’s court to administratively suspend Englebrecht’s license and to put him in front of the commission board for suspension or revocation.
Instead, none of that appears to be the case. Englebrecht has a show scheduled for next week and staffers working on behalf of the Athletic Commission are getting their work assignments for the event. It appears California will not honor Nevada’s suspension, which will stir up a real political hornet’s nest. Money talks. The political fallout between California and Nevada will intensify.
This development, juxtaposed to last week’s court allegations in a wrongful termination lawsuit about Bellator fighters supposedly submitting medical records to California’s athletic commission from an unlicensed doctor, raises serious questions in regards to how soft the authorities are against California-based promoters and managers.
In the legal complaint filed against Bellator, there was something largely overlooked in media circles about Zach Light’s claim of invalid fighter medical records being submitted in California.
By Zach Arnold | May 31, 2016
William M. Crosby (SBN: 49357)
13522 Newport Avenue, Suite 201
Tustin, California 92780-3707
Telephone: (714) 544-2493
Fax: (714) 544-2497
SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF LOS ANGELES, CENTRAL DISTRICT
ZACHERY LIGHT vs. BELLATOR SPORT WORLDWIDE LLC, a Delaware LLC; VIACOM INC., a Delaware corporation; DOES I through X, inclusive
COMPLAINT FOR WRONGFUL TERMINATION BASED ON PUBLIC POLICY; JURY TRIAL DEMAND
SUMMARY OF CLAIMS
This is an action for damages by plaintiff against defendants based on an egregious bad faith course of conduct toward plaintiff due to plaintiff’s having protested certain illegal practices jeopardizing the health and safety of professional fighters and mixed martial artists all for defendants’ profit and financial gain. As a result plaintiff was shunned, harassed, slandered, and demeaned in an attempt to discredit and sabotage plaintiff. Consequently, plaintiff was forced to go on an extended medical leave and was thereafter wrongfully terminated when he attempted to return from such medical leave. Plaintiff seeks compensatory damages, including economic damages for past and future loss of earning and benefits, general damages for emotional distress and reputational harm, and punitive damages.
PARTIES & AGENCY
[starting on page 5]
Plaintiff was exclusively responsible for the sale of tickets through fighters to these events, often selling thousands of tickets per event. Through 2014, plaintiff had sold over $2.5 million in ticket sales, in part through the use of local fighters on consignment. In addition, plaintiff recruited and signed fighters and performed numerous other vital duties for the company.
VIACOM’S ACQUISITION OF DEFENDANT BELLATOR AND THE CHANGE IN DEFENDANT BELLATOR’S CULTURE FOLLOWING A CHANGE IN MANAGEMENT:
Defendant VIACOM acquired a controlling stake in defendant BELLATOR in or about January of 2013. In June of 2014, (Bjorn) Rebney left the company and was replaced by Scott Coker as CEO. Thereafter defendant BELLATOR closed its Orange County office and moved its office to the Los Angeles County VIACOM office in Santa Monica, where plaintiff remained employed until his wrongful termination. Contemporaneous with this change in management, there was a marked change in defendant BELLATOR’s management practices. Gone were the regular and recurring mandates from prior management to obey and exceed the high standards of adherence to state and national rules and regulations governing mixed martial arts events. The marked change in management practices was also evidence by a disregard for well established business protocols in the accounting for consignment tickets and income from events. Plaintiff also noted a lack of communication regarding important issues such as status of upcoming events and fighters contracts.
DEFENDANT BELLATOR’S MULTIPLE VIOLATIONS OF STATUTES ENACTED TO PROTECT THE HEALTH AND SAFETY OF MIXED MARTIAL ARTS FIGHTERS:
Beginning in September of 2014, plaintiff became aware of a number of instances in which defendant BELLATOR failed to observe and knowingly disobeyed laws enacted to protect the health and safety and mixed martial arts fighters. California Business and Professions Code 18711 requires a medical clearance examination by the licensed physician for participants in a mixed martial arts fight. Plaintiff learned from a reliable source at an event refereed to as Bellator 126 in September of 2014, that fighter Ryan Martinez’ state-mandated blood and eye medicals submitted to the state of Arizona were admittedly forged. At an event in San Diego referred to as Bellator 131 in November of 2014, plaintiff learned from reliable sources that a number of fighters on the card had submitted California state-required medicals by one Adam Rendon, who was not a licensed physician, in violation of Business and Professions Code 18711 and 17500.
PLAINTIFF’S COMPLAINTS TO DEFENDANT BELLATOR MANAGEMENT REGARDING FORGED MEDICAL REPORTS:
Approximately 48 hours prior to Martinez’ scheduled fight at Bellator 126, plaintiff promptly reported what he had learned to Rich Chou, defendant BELLATOR’s Vice President of Talent. Chou assured plaintiff that he would follow up and that plaintiff should focus on his job. When plaintiff heard nothing further from Chou, he approached Coker regarding Martinez’ impending fight based on forged medicals, in violation of Arizona law. Coker told plaintiff to “do what Chou told you to do,” without addressing these issues. Thereafter, plaintiff again brought the subject up to Chou. Chou threatened plaintiff with termination if he kept pushing the issue. Plaintiff later learned that after losing his bout, Martinez never resumed his mixed martial arts career.
Prior to the Bellator 131 event, plaintiff told Coker that fighters had been suspended for using Rendon to sign their medicals because Rendon was not a licensed physician. Coker told plaintiff, “a lot of people at Bellator are going to lose their jobs next week. Do you want to keep yours”> Coker added, “then stay in your lane and stop making waves!” Fearful of losing his job, plaintiff said nothing further regarding the falsified medical reports.
COKER PRESSURES PLAINTIFF TO PROMOTE COLLUSIVE FIGHTS IN VIOLATION OF THE SARBANES-OXLEY ACT:
In the fall of 2014, Coker was award that two of defendant BELLATOR’s most popular fighters, Rampage Jackson and Cheick Kongo, were managed by Anthony McGann. Coker disliked McGann and referred to him as a “fucking terrorist.” Coker told plaintiff that there were “huge problems” negotiating new BELLATOR promotional agreements for Jackson and Congo. Coker was aware of plaintiff’s long-standing friendship with Kongo and instructed plaintiff to use that friendship as a basis to convince Kongo to fire McGann as his manager. Plaintiff told Coker that in addition to being friends with Kongo, he had also previously worked for McGann and did not want to intentionally interfere with the manager/client relationship that existed between McGann and Kongo. Coker instructed plaintiff to negotiate directly with Kongo to sign a bout agreement which was not consistent with his promotional agreement. Plaintiff was not allowed to see Kongo’s promotional agreement. Kongo told plaintiff that the amount of his compensation in the proposed bout agreement was not correct. Coker specifically told plaintiff that if he wanted to keep his job, he should do what he was told and “get rid of McGann.” In fear of losing his job, plaintiff convinced Kongo to fire McGann and pressured him to sign the bout agreement.
The fight under this new bout agreement occurred in September of 2014 against Lavar Johnson at Bellator 123. Kongo was angry upon learning that he would be paid much less than he was contractually entitled to pursuant to his promotional agreement. Plaintiff’s relationship with Kongo was permanently ruined. Chou later acknowledged mistakes and agreed to pay Kongo additional sums for the next bout. Plaintiff suffered lasting harm to his reputation in the mixed martial arts community.
Coker was also enraged with McGann that Jackson had signed a promotional agreement with the UFC while Coker believed that Jackson was still under contract with defendant BELLATOR – a fact contested by Jackson and McGann. This act on McGann and Jackson’s part was a substantial embarrassment to Coker, as it would mean that defendant BELLATOR’s biggest star was leaving defendant BELLATOR for the UFC. In addition to Jackson, McGann had a number of additional fighters under contract at defendant BELLATOR. Coker told plaintiff to “get the terrorist’s fighters beaten and beaten badly,” thereby allowing Coker to cut ties between defendant BELLATOR and McCann. Plaintiff was required to arrange fights between McGann’s fighters and opponents who would convincingly defeat them. Such outcomes would then enable Coker to have a convenient pretext to terminate McGann’s fighters’ promotional contracts with defendant BELLATOR. Such collusive matches were tantamount to fight fixing and constituted a fraud on ticket buyers, fight patrons, television viewers, advertisers, and the public at large, as well as McGann and the professional fighters he managed.
Under the Sarbanes-Oxley Act (“SOX”) whistleblowers provisions, employees in privately held subsidiaries of publicly traded companies who assist in an investigation into an employer’s violation of SOX are protected from employer retaliation (18 U.S.C. 1513(e) and 1514A(a)). This conduct also violates California Business and Professions Code 17500 which proscribes misleading statements concerning professional services.
In late 2014 and early 2015, a close friend of Coker, Mike Kogan, was hired by defendant BELLATOR in an executive capacity. Plaintiff knew that Kogan represented numerous mixed martial arts fighters, many of whom were under professional agreements with defendant BELLATOR. Plaintiff is informed and believes and thereon alleges that Kogan was paid management commissions for fighters he represented in bouts that occurred with defendant BELLATOR. This was a serious conflict of interest in violation of California Business and Professions Code 18878, 18897.27, 18897.47, as well as California Code of Regulations, Title 4, section 243. Plaintiff, aware of and concerned about this glaring conflict of interest that existed when an executive of defendant BELLATOR also managed fighters competing for defendant BELLATOR, expressed his strong concerns regarding these conflicts to Chou. Chou responded, “leave it alone, he’s on our team.”
PLAINTIFF’S COMMUNICATIONS REGARDING AN EMPLOYEE OF DEFENDANT BELLATOR DRIVING ON A SUSPENDED LICENSE:
In June of 2014, plaintiff spoke to Coker and Chou regarding an employee of defendant BELLATOR who was continuing to drive defendant BELLATOR’s owned and branded transport vans to transport BELLATOR fighters, fight managers, commission officials and other employees of defendant BELLATOR to and from airports and to various BELLATOR event related locations even though his driver’s license had been suspended due to a DUI. When plaintiff noted that the employee had not stopped driving, he brought the problem again to Coker’s attention. Coker told plaintiff to “stop making waves” and “just do your job.”
PLAINTIFF’S STRESS-RELATED MEDICAL LEAVE AND TERMINATION:
From September of 2014 through April of 2015, plaintiff experienced increasing anxiety, depression, insomnia, and mental and emotional distress as a result of Coker and Chou’s refusal to follow applicable laws and regulations and by requiring plaintiff to engage in illegal practices as a condition of keeping his job.
On April 10, 2015, following the Bellator 136 event at the Bren Events Center in Irvine, California, plaintiff suffered an anxiety attack which resulted in emergency care at a hospital. Plaintiff was medicated and diagnosed with severe depression and anxiety. Thereafter he was placed on an extended medical leave, prescribed psychoactive medications, and underwent therapy with a physician.
Due to his consequent loss in income, plaintiff was forced from his rented home into a small apartment. On March 10, 2016, plaintiff was cleared to return to work without restrictions. By letter of March 17, 2016, plaintiff was advised of his termination and that his job was no longer available.
FIRST CAUSE OF ACTION
(Wrongful Termination Based on Public Policy Against Defendants BELLATOR and VIACOM)
On March 17, 2016, defendants BELLATOR and VIACOM wrongfully terminated plaintiff in violation of a substantial and fundamental public policy, in that defendant BELLATOR, a wholly owned subsidiary controlled by defendant VIACOM, engaged in conduct that required plaintiff to participate in and authorize violations of statutory law based on the Acts and Statutes cited at paragraphs 12 through 20 above. The wrongful conduct of defendants BELLATOR and VIACOM created such intolerable working conditions for plaintiff that plaintiff was forced to take an extended medical leave. When plaintiff tried to return from such medical leave, he was terminated. Plaintiff was accordingly wrongfully terminated in violation of public policy.
As a direct and proximate result of said wrongful termination, plaintiff sustained economic damages for past and future loss of earnings and benefits, according to proof.
As a further direct and proximate result of said wrongful termination, plaintiff sustained general damages for severe mental and emotional distress.
Defendants BELLATOR and VIACOM acted with malice and oppression toward plaintiff and with conscious and wanton disregard of plaintiff’s rights, and defendants BELLATOR and VIACOM should therefore be assessed punitive and exemplary damages in sums sufficient to punish them and set an example in view of their respective financial conditions.
WHEREFORE plaintiff prays judgment against defendants as follows:
1. For economic damages, according to proof;
2. For general damages, according to proof;
3. For punitive damages, according to proof;
4. For costs of suit incurred; and,
5. For such further relief as the Court deems proper.
Dated: May 24, 2016
WILLIAM M. CROSBY
Attorney for Plaintiff ZACHERY LIGHT
By Zach Arnold | May 25, 2016
In America, there are three major bodies of law: criminal, civil, and administrative. Commissions like the Nevada State Athletic Commission are administrative but often get carried away in regards to what the scope of their authority is.
Last month, we detailed major changes coming to Nevada’s commission in regards to both their financial & legal obligations. Nevada’s state budget is transitioning the commission from general funding to self-funding, meaning there is no longer a blank check for funding expenditures. The Athletic Commission got hit with a fat legal bill for years of work the Attorney General’s office did for them in the past.
As a result of the funding mechanism being changed, the Athletic Commission is backed against the wall. With out-of-competition drug testing, disciplinary hearings, administrative costs of handling paperwork & medical records, and all the drama surrounding combat sports, a lot of resources are required. Nevada’s commission has always prided itself on having a lean, efficient, prompt operation.
Now the money’s drying up and without Floyd Mayweather fights on the horizon, a change in philosophy is occurring in Las Vegas. For fighters and their due process rights, it may not be for the better.
By Zach Arnold | May 25, 2016
The Nevada State Athletic Commission officially suspended California promoter Roy Englebrecht for 18 months after he provided false & misleading information to the commission regarding information put on boxer Zab Judah’s fighter application form regarding child support he owed to the state of New York. Additionally, Englebrecht will be put on one year’s probation when he re-applies for a Nevada license, be obligated to pay attorney fees for his disciplinary hearing, and make restitution to fighters who lost money due to a Las Vegas show getting canceled by the Athletic Commission a few months ago.
The big question, unresolved, is whether or not California will recognize Nevada’s suspension. Unlike fighters, there is no reciprocity provision mandating state athletic commissions honor promoter suspensions. Given that Englebrecht’s base is California and the majority of his business is done in California, the Nevada suspension is more or less toothless if California decides to ignore Englebrecht’s suspension over acts of moral turpitude.
The war to settle the score
Rarely do you see “liar, liar, pants on fire” anger on display from an Executive Director towards a promoter but Nevada boss Bob Bennett and state AG Caroline Bateman held nothing back in Wednesday’s disciplinary hearing against Roy Englebrecht. They didn’t call him a liar but used as many words as possible to insinuate he was one.
- Zab Judah was scheduled to fight in Las Vegas
- On the fighter application form, it stated that he did not owe back child support
- New York authorities claimed Judah owed $274,000 in back child support but reached an agreement with him in February which would allow him to fight and his purse money to be forwarded to NY authorities
- When Bob Bennett found out about the back child support, he pulled Judah from the Vegas card promoted by Roy Englebrecht
- Englebrecht told Bennett that he had filled out Judah’s fighter application form
- Bennett immediately contacted Nevada’s commission chairman regarding the admission of perjury and forgery
What Wednesday’s disciplinary hearing revealed was an incredible tale of multiple parties involved in an event collapse built on numerous promises not honored.
By Zach Arnold | May 17, 2016
The Nevada State Athletic Commission’s next meeting is on Wednesday, May 25th, and the hammer is coming down on promoter Roy Englebrecht. The Attorney General’s office has filed their official administrative legal complaint against Englebrecht. Amongst the charges outlined in the administrative complaint:
- On February 13th, 2016, the commission received a license application for Zab Judah and that Englebrecht, under penalty of perjury, forged Judah’s signature on the Application.
- Unknowingly, Englebrecht signed Judah’s application not realizing that he owed back child support.
- Englebrecht used Judah’s date of birth and social security number on the forged application, violating Nevada’s identify theft law (NRS 205.463).
The AG’s office had the option of pursuing criminal charges but opted for the administrative route instead.
During a March 23rd meeting regarding an extension of a temporary Nevada suspension, Englebrecht admitted under oath that he was guilty of the charges being presented against him. The 3/23 meeting was not a disciplinary meeting but he decided to fall on the sword without legal representation present.
The administrative complaint was filed against Englebrecht on May 3rd, giving him 20 days to respond before the meeting on May 25th. Nevada wants action taken against Englebrecht’s promoter license along with investigative costs & attorney’s fees.
The major question after May 25th is whether or not the California State Athletic Commission, which is Roy’s home turf, will enforce Nevada’s license suspension. There’s a lot of money at stake and California is legally not obligated to follow the suspension of a boxing promoter in another state. If California chooses to ignore Nevada’s suspension, it will spark political tension between the two states.
By Zach Arnold | May 15, 2016
When we last checked in with a boxing doping scandal, VADA produced a positive test result of clenbuterol for Francisco Vargas. The California State Athletic Commission did not suspend Vargas since they weren’t the ones who administered the drug test.
The NFL Players Association came out and warned their athletes not to each too much Mexican or Chinese meat because clenbuterol could show up in their drug test results.
VADA has been trying to get their foot in the door in regards to worldwide drug testing in boxing. They managed to take a page out of the UFC/USADA playbook but on a much, much larger scale with the WBC sanctioning body. The end result is the Clean Boxing Program project, where all fighters ranked 1 through 15 for WBC titles are required to register for VADA drug testing.
The latest fighter to get busted by VADA is Alexander Povetkin, who was scheduled to fight Deontay Wilder in Moscow. Povetkin tested positive for… meldonium. This Bloody Elbow article on meldonium is a good starting point if you don’t recognize the name of the drug.
Povetkin’s camp reportedly claims that the fighter stopped taking meldonium last September. According to ESPN’s Dan Rafael, that story doesn’t hold up because Povetkin took multiple VADA drug tests in April and tested negative until April 27th when he supposedly got busted.
The WBC initially “postponed” the fight. Wilder’s camp abruptly ended and he went back home. Now it appears the fight is “off” and will not happen.
We have a lost fight. We have lost purse money for both guys, which means litigation is likely. But the fight was scheduled to take place in Russia. How will money get recovered in the Russian legal system?
The major legal ramifications of the WBC & VADA tag team
It’s highly unlikely that standard American state athletic commission drug testing would have caught what VADA caught with Alexander Povetkin. VADA has an established track record of catching certain fighters (think: Lamont Peterson) microdosing but not getting any sort of results in suspension or canceled fights. The Nevada State Athletic Commission did not want to cancel Peterson’s fight.
UFC changed the landscape by partnering with USADA and unilaterally enforcing drug suspensions. It just happened this past weekend with their mega Brazilian event. The end result has been largely positive. The UFC acts as their own sanctioning body for titles in MMA. Boxing already has sanctioning bodies. The WBC is the most famous sanctioning body of all. VADA attaching itself to the WBC for drug testing has proven to be a genius move… for now.
There are serious legal and business questions that must be asked.
First, we know that the text of the Ali Act specifies transparency for sanctioning body rankings. OK. I couldn’t answer to you how rankings are currently formulated. It’s arbitrary and at the whims of the powers-that-be. Fighters have no say in how they are ranked by the sanctioning bodies.
So the WBC decides to name 15 ranked fighters for each of their title belts. Let’s say a fighter doesn’t want to cooperate with the WBC on the VADA testing and wants nothing to do with the WBC. What statutory authority does the WBC have to punish a fighter other than publicly shaming a fighter in the press and preventing that fighter from fighting in WBC-sanctioned fights? Will the WBC rely on TV networks and business partners to pressure fighters into cooperating with the WBC or else get iced out?
Scenario two: Let’s say Fighter A is scheduled to face Fighter B and both fighters agree to VADA testing but the fight has two title belts from two different sanctioning bodies on the line, e.g. WBC & IBF titles. What happens if Fighter A tests positive? Does the WBC have the power to cancel the fight? What about the purse money involved given IBF involvement?
Second, if Fighter A tests positive for a WBC title fight in a state like Nevada, would Nevada’s athletic commission accept the result of the VADA drug test? They currently don’t. Why would state athletic commissions change drug testing enforcement policy now?
Third, when the money is large and the stakes are high, how solid will WBC’s backbone be? The Wilder/Povetkin fight was on the rocks until Wilder went back home and then the fight was “postponed.” What if Wilder had said that he wanted the fight to continue so that he could earn the purse money?
What will the TV networks backing cable & PPV fights do if they lose multiple fights? Slash boxing budgets further?
Fourth, given the new legal liability at stake with the WBC/VADA drug testing tag team, will there be momentum amongst promoters to avoid booking WBC fights due to fears of getting sued for breach of contract or other economic tort claims when their fighters test positive?
In the name of advancing an agenda for a clean sport, it appears the biggest winners will be the attorneys.
By Zach Arnold | May 10, 2016
The rumors of Zuffa selling UFC have been hot and heavy, thanks to reporting from Front Row Brian. Private Equity firm Blackstone has long been thought to be the primary buyer in play.
So it comes as no surprise that Darren Rovell’s ESPN report about Zuffa getting ready to sell UFC has stirred up passionate responses from all corners. Dana White has issued a blanket denial about UFC being for sale but the Fertitta family has stayed silent.
According to Rovell’s report:
- God of Wall Street, Goldman Sachs, is representing UFC in sales talks
- The asking price is believed to be in the $3.5 to $4 billion USD range
- Goldman Sachs is reportedly telling buyers that UFC made $200 to $250M USD EBITDA in 2015
- The four finalists in contention to buy UFC are: William Morris/IMG, China Media Capital, Blackstone Group, and Wang Jianlin’s Dalian Wanda Group
It is believed that Jianlin is the leader in the clubhouse. He’s the richest man in Asia at nearly $29 billion dollars. Given his power in China, you could see why buying UFC would be a seductive investment. He would have the political and business clout to clear hurdles in communist China that others do not possess. No Ali Act to worry about outside of America. A favorable legal situation where fighters simply would not have the cash to fight in international courts.
I'm told that Dana White's status actually a negotiating point in at least one of the offers for #UFC. Not everyone keen on him staying on.
— Jonathan Snowden (@JESnowden) May 11, 2016
While Dana White has denied UFC being for sale, he did not deny that Goldman Sachs is representing UFC and he did not deny the $200-250M EBITDA figure.
Why would Zuffa want to sell UFC now?
There are lots of reasons for Zuffa wanting to flip UFC soon.
First, the MMA economy is extremely volatile. One year you have a golden goose and the next year you have a goat.
Second, lawfare. The anti-trust lawsuit is producing illuminating discovery. Depositions are coming soon. UFC is vulnerable. The company is also vulnerable to the kinds of concussion-style lawsuits that plagued the NFL. The difference is that the NFL has already settled their pending cases for a relatively small amount of cash.
Third, the business isn’t as fun of a joy ride as it used to be. The Fertittas put up over $40 million dollars before recovering their investment thanks to The Ultimate Fighter. Ownership has put up with thousands of talent-related headaches that they would have never had to put up with in another kind of sporting venture. UFC was a great way for the Fertittas to meet politicians, celebrities, and rich business leaders. They’ve maxed out on that front. They relied on rich people and entities to do their heavy lifting. There are limits to where they stand internationally.
The fourth and most intriguing reason deals with the Fertitta family wanting to shift into other business ventures. A fascinating connect-the-dots scenario:
If Fertittas sell UFC, wouldn't be surprised to see them try to buy piece of Raiders if team is headed to Las Vegas.
— Darren Rovell (@darrenrovell) May 10, 2016
The Fertittas just did their Red Rock IPO and cashed out big. Now they’re buying out the Palms in Vegas for $312.5 million dollars. But the real main event coming to Las Vegas involves the Oakland Raiders. Sheldon Adelson wants to build a major sports complex. Mark Davis, the son of Al Davis and current Raiders majority owner, is the poorest of the current NFL owners. He’s going to need cash to pull off the move to Las Vegas. Davis has promised to contribute $500 million dollars to the cause.
What’s a better way to get into the elite business inner circle of the NFL than attaching to the Raiders in Las Vegas? Selling off UFC in order to get a piece of the Raiders is a no-brainer business transaction. It would immediately elevate the political and business clout of the Fertitta family and do so in a sport that produces significantly more revenue with fewer headaches than MMA. From the proverbial outhouse to the penthouse.
It is no coincidence that UFC tried to clean up their testosterone scandals with the USADA drug testing program. It is no coincidence that Dana White has taken a back seat publicly. It is no coincidence that fighters have been strapped into the one-size-fits-all Reebok sponsorship model. Cleaning up the loose ends to sell UFC to a private equity firm is the end game. It will be a great Return on Investment for the Fertittas but it does not guarantee an automatically great result for MMA fans:
In most instances, you’re looking at a 5-7 year period where the PE firm wants to grow revenue, reduce costs and get out w/ the FUCK MONEY.
— FrontRowBrian (@FrontRowBrian) May 11, 2016
It won’t be just the folks in Las Vegas popping the champagne corks. The executives at Spike TV will be throwing their own party.
Dana White: The Fertitta's are not looking to buy a football team (Note: They would have to get out of casino business to own NFL team)
— Jason Floyd (@Jason_Floyd) May 11, 2016
There will be an exit strategy. Only a matter of how it is structured.
By Zach Arnold | May 2, 2016
Al Haymon envisioned a UFC-like scenario for boxing. As the Zuffa Myth goes, the Fertittas lost $44 million dollars before hitting it big with The Ultimate Fighter. Little did the Fertittas know how much Al Haymon would make their $44 million dollar “investment” in UFC look like chump change. Forget $44 million dollars. Forget the amount of cash organized crime spent in Japanese pro-wrestling, boxing, and MMA. Al Haymon trumped all of them with a $925 million dollar cash infusion into PBC.
Who on Earth would think that pouring $925 million dollars into combat sports would be a good idea? This is the basis of the latest prong in the nationwide legal attack against Al Haymon and the two investment trusts that have gone all-in with him.
First came the plea from the Association of Boxing Commissions to the Department of Justice to go after Al Haymon. Addendum: New ABC president Mike Mazzulli refuted the allegations made in the letter sent by ABC last year.
Then came the unfair competition & anti-trust lawsuits in California by both Golden Boy & Top Rank in Los Angeles Federal court. Haymon’s legal team couldn’t stop the plaintiffs from discovery & depositions, which will surely provide evidence to allow GB & TR to amend their initial legal complaint to add more defendants and more causes of actions.
Now comes the lawsuit against the two trust vehicles financing Al Haymon’s PBC. It’s a shareholder derivative lawsuit, meaning shareholders are suing the trust vehicles they invested money in and they’re doing so based on allegations that the corporation won’t fulfill their responsibility to the shareholders in getting their money back on an investment that supposedly violated the promises made in the investment prospectus.
Read Paul Gift’s article at Bloody Elbow titled $925 million lawsuit filed over investments with PBC’s ‘shady entrepreneur’ Al Haymon. Here’s the zinger from the article:
“According to Waddell’s website, as of Mar. 31, 2016 these six funds now have a total market value of only $357,747,414, which implies that the funds allegedly used to finance the PBC have collectively lost over $567 million in a little less than three years.”
The legal teeth for trying to choke out Al Haymon’s funding
Now I will point out some very interesting items you might want to focus on from this latest legal attack.