By Zach Arnold | April 15, 2016
There has always been one critical question about UFC’s purchase of PRIDE’s assets: why did the Nevada Gaming Commission allow the deal to happen?
The Nevada Gaming Commission is extremely tough on business dealings involving questionable individuals and walking acts of moral turpitude. We knew the Fertitta family had extraordinary power but even they aren’t the biggest fish in Nevada.
One of the nagging sub-questions about that asset purchase was this: UFC hired Spectrum Gaming to cover their ass on the issue of “due diligence” with PRIDE. In other words, legal cover for dealing with Nobuyuki Sakakibara and company. When Spectrum Gaming gave cover to UFC for the PRIDE asset purchase, I couldn’t believe it. Why would these entities risk their reputation for that guy even at UFC’s benefit?
Paul Gift’s report at Bloody Elbow details some extremely interesting findings if you followed the timeline of PRIDE’s implosion:
- According to court filings, Sakakibara was looking to unload PRIDE in February of 2006. This is significant because it shows that Sakakibara, knew the end was coming with Fuji TV after Shukan Gendai’s negative campaign. The cat was out of the bag. They were looking for an exit strategy.
- The final purchase price to buy off Sakakibara alone was $3.7 million USD + $9 million (non-compete) + $1.5 million. A $14.2 million USD pay-off to prevent Sakakibara from being their Japanese rival.
- UFC allegedly used the Spectrum Gaming due diligence report to stop the flow of cash. In other words, UFC knew exactly what caused PRIDE to implode, got Sakakibara out of the business, and then turned around and told him to get lost.
- Spectrum Gaming knew all about Shukan Gendai’s negative campaign and couldn’t supposedly produce evidence to their liking from Sakakibara himself to clear his name that had been tarnished in the tabloids, including the allegations regarding “vendor” companies.
The 38-page Spectrum Gaming report on Sakakibara & Dream Stage Entertainment is an amusing read. Some bullet points:
- Spectrum got nowhere when contacting DSE vendors. “Although Spectrum investigators managed to speak to some staff at various Vendors to advise them of our role in the Due Diligence process, none was willing to cooperate. In fact, most Vendors contacted were non-cooperative to the point to refusing to take Spectrum’s calls, or in one case, even threatening legal action.
- UFC agreed to “lower” their due diligence standards with Spectrum by having Spectrum only do online media & Internet research. I’m glad they read Fight Opinion.
- DSE’s accountant allegedly “resigned” after Spectrum started investigating, only for that accountant to show up with Sakakibara during investigative hearings.
- In April 2006, Sakakibara obtained a 10-year loan with an individual named Nobuo Kawagami at an annual interest rate of 10%. Spectrum claimed that Sakakibara did not want to reveal details about the loan or the person issuing the loan. Mr. Kawagami has a cell phone company called Dowango.
- One of the major financial backers when Dream Stage Entertainment was formed was a printing company called Nishikawa Communications, based in Nagoya. Just like Nobuyuki Sakakibara was based in Nagoya for Tokai TV. The first PRIDE event under the DSE umbrella was PRIDE 5, Nobuhiko Takada vs. Mark Coleman at Nagoya Rainbow Hall. Sakakibara bought out shares in DSE from Naoto Morishita’s widow, Nishikawa Communications, and a company called Planet.
- Spectrum claimed that Sakakibara’s right-hand men, including Sotaro Shinoda and public relations flack Keiichi Sasahara (who later went to be a face of DREAM) were non-cooperative.
- Spectrum wrote this bombshell: “Reports have been provided on the five Tier 3 Vendors, and four of the five companies have been found to have links to organized crime entities, and this is not suitable to do business with the new DSE company.”
- Spectrum found out that the Nevada State Athletic Commission sued Dream Stage Entertainment for allegedly being deadbeats on paying the TV tax for a Las Vegas event.
- Spectrum summary on Nobuyuki Sakakibara: “While Spectrum cannot speculate about their precise motives in not wishing to cooperate with the investigation, it is clear that a number of the Directors, especially Sakakibara and Kato, had much to hide, including major conflicts of interest through their personal interests in various DSE vendor companies, opaque financing and possible links to organized crime. Although none of the Directors was known to Japanese law enforcement to be a Yakuza member, media information alleges possible organized crime connections regarding DSE operations and Sakakibara. It should be pointed out that the use of “front companies” or companies that are “one step removed”, such as the Vendor companies, is a traditional method used by Yakuza Organized Crime Families in Japan to hide their association or involvement in high profile companies such as DSE.”
- Spectrum confirmed the long-standing open rumor that Sakakibara was living the high-life at Roppongi Hills in Tokyo, an 18-story condo building. “The utlities for room were subsequently found to be contracted under the name [redacted], whereas the registered owner is Hiroo Kurokawa.”
- Spectrum discovered that Ed Fishman, who tried to buy the PRIDE assets from Nobuyuki Sakakibara, filed a lawsuit against DSE for breach of contract in helping Sakakibara with the PRIDE Las Vegas events.
- Spectrum’s interview with Sakakibara revealed that his claims of filing criminal and civil actions against Shukan Gendai for their negative campaign was all a bluff.
- DSE was under investigation by the Japanese tax authorities for several years.
- Sakakibara told Spectrum that he knew the mysterious Mr. I (Takashi Ishizaka), claiming he knew Ishizaka from the 90s and that Ishizaka is both a manager of celebrities and tied to a real estate company named Aoyama Mainland. However, Sakakibara denied doing business with Ishizaka.
Bottom line? Everyone knew “the truth” going into the business deal. They were all trying to fight each other *after* the deal.
Which raises the primary question we asked a decade ago: Why did the Nevada Gaming Commission allow this transaction to happen and allow a due diligence background check happen *after* the transaction?
Sakakibara sued Spectrum Gaming and UFC. They reached a settlement. He got paid. Everybody got what they wanted. Everybody knew what they were getting into. The regulators didn’t stop the transaction from happening. None of this is earth-shattering information but it does confirm the majority of suspicions you had about what exactly went down and why.
By Zach Arnold | April 6, 2016
What do you get when you pair:
- A sports league with no cultural connection to a country and…
- A pay TV channel with a decades-long history of being a graveyard for combat sports
You get the UFC marriage with WOWOW in Japan. It was destined for failure from the start.
IT Media/Business Online in Japan confirmed on Thursday morning local time the end of the UFC/WOWOW television marriage. With no major Japanese stars, there simply wasn’t a financial interest for WOWOW to continue doing business. Why pay a premium for a sports product behind a TV pay wall with no real ties to Japan?
This is less about UFC failing in the Japanese marketplace as it is simply a matter of fact that this was a business relationship that was never going to succeed. UFC was the antithesis of PRIDE. They bought the PRIDE assets out and found out the hard way how hostile the lay of the land was for doing business in Japan. UFC partnered up with Dentsu for a reported sold-show deal that is still on-going but has not really gone anywhere in terms of business growth. At this point in time, UFC’s once-a-year Japanese event is simply perfunctory. UFC was hot for one Saitama Super Arena event… and then it went flat.
Combat sports, more than traditional sports, is entirely built on a cultural & emotional connection. UFC’s marketing of their product was often built on reason and logic. We’re the best fighters in the world. We beat PRIDE. The cage is safer than the ring. Come and watch us. It was a rational argument. Rational arguments in combat sports never work. Tribal identity & analogies always trump reason & logic on the persuasion scale. Japan, more than any other major sports economy, is built on the staying power of nationalism. The UFC was not a Japanese company and was not a company with Japanese stars.
By Zach Arnold | April 2, 2016
The momentum for both Jon Jones and Daniel Cormier was heading on a negative track.
Mr. Jones found himself in an orange jumpsuit and more legal trouble for opening his mouth to a cop who didn’t have a problem looking for an encounter. His public image took a needling for calling the chatty cop a pig. Jones has the worst of all public personality traits for a top-level athlete: socially awkward, ambivalent, obtuse, stunted maturity, passive-aggressive, Dr. Jekyll & Mr. Hyde combined with a raw sense of entitlement plus IDGAF mode. It’s not a debate as to whether or not he’s a “bad guy” — he’s troubled and self-destructive. You’ve also seen the media reports about his brother Chandler who just got traded from the New England Patriots.
When you opine that his judgment outside the cage appears to be as awful as his judgment is great in the cage, that’s supposed to be an easy “bad boy” sell on paper. Not for Jon Jones. His rap sheet is as appealing as the proverbial turd in the punch bowl. Nick Diaz gets a DUI and nobody blinks. Jon Jones gets a DWI and the Internet explodes.
People will continue to pay to see Jon Jones destroy opponents, wreck their credibility, and strip away the respectability of his rivals into subordinate status. He did this to Daniel Cormier.
— MMA Supremacy (@MMASupremacy) April 1, 2016
By Zach Arnold | March 31, 2016
He sang like a songbird at last week’s Nevada State Athletic Commission meeting in Las Vegas, admitting wrongdoing in relation to allegations of perjury, forgery, and (possible) charges related to improper use of a social security number and intentional misrepresentation on Zab Judah’s licensing paperwork.
However, the admission of wrongdoing amidst pending charges by Nevada’s Attorney General office isn’t stopping Roy Englebrecht from promoting an event in Orange County next week. Englebrecht sent out promotional material on Thursday for his event next week at the Orange County Fair & Event Center. It will be a hybrid MMA/boxing card.
It is the first evidence that the Department of Consumer Affairs, which oversees the California State Athletic Commission, has not temporarily suspended Englebrecht given the pending charges in Nevada and his admission of wrongdoing under oath.
Once the Nevada State Athletic Commission delivers permanent punishment to Englebrecht, the big question is whether California honors the suspension or not. They are legally obligated to honor fighter suspensions but have legal discretion regarding the honoring of promoter suspensions.
Consumer Affairs in Sacramento has a lengthy legal history of revoking licenses from individuals who are guilty of acts of moral turpitude (honesty & trustworthiness). Perjury and forgery falls into this category. DCA targets individuals all the time through their various boards over DUIs, police encounters, theft, and other crimes of depravity. If you are guilty of an act of moral turpitude, you can’t get or keep a liquor license, a license to promote events, a license to be a notary public, a medical license, a nursing license, or a law license.
Behind the scenes, there are rumors that California State Athletic Commission Executive Officer Andy Foster will be spending the month of April in Georgia. It is believed that his number one athletic inspector, Mark Relyea, will be running commission duties from Southern California.
By Zach Arnold | March 31, 2016
An interim belt at 145. Not because of injury. Because the 145 champ is too busy fighting at 170 in a nonsensical rematch.
— FrontRowBrian (@FrontRowBrian) March 31, 2016
Let’s consider the last four months, shall we?
- After knocking out Jose Aldo in 13 seconds, tension filled the air at the post-fight presser between UFC and McGregor’s camp.
- If you believe various media reports, Conor felt he had enough leverage to start asking for co-promotional business deals to promote future events with the UFC.
- UFC supposedly (and predictably) scoffed at the notion that they would ever do any boxing-style business deal with one of their aces.
- In a passive/aggressive manner, UFC booked McGregor against the least-marketed champion ever in Rafael dos Anjos.
- RDA got injured and had to cancel his fight with McGregor.
- On short-notice, UFC booked Nate Diaz as a last-minute replacement. Hey, he’s a 3-to-1 underdog. He’s a Diaz brother. People confuse the two. He’ll attract eyeballs. Easy win. Win-win!
- The fight between Nate Diaz and Conor McGregor ends up getting booked at 170 pounds.
- McGregor was simply not the same fighter at 170 pounds and didn’t bring any of the advantages to the table that he did at 145 pounds.
- Nate Diaz, as a Diaz brother is hard-coded to do, destroyed the best-laid plans and won the fight.
- The fight blows away all expectation for PPV buys, with an estimated 7-figure PPV buy rate.
Given all of this, it was an absolute no-brainer that UFC would book Nate Diaz vs. Conor McGregor for UFC 200. I think it’s hilarious that the Diaz brothers are once again creating chaos in modern day MMA. Everyone will profit off of this carnival. It may not be Brock Lesnar vs. Frank Mir and 1.7 million PPV buys, but nothing ever will reach that zenith again for UFC. Diaz vs. McGregor is cotton candy for the masses.
It’s also a no-lose situation for UFC.
By Zach Arnold | March 30, 2016
Sacramento and Tallahassee, you two are cheap dates when it comes to the amount of cash required to lobby for legislation.
The UFC has powerhouse lobbying firms on retainer all across the United States. In Florida, their partners are Corcoran & Johnston. In California, it’s the inimitable Tim Lynch at Platinum Advisors. The price tag is at least $15,000 a quarter for retainer. In most cases, UFC is spending upwards of $75,000 as a minimum to lobby & exert incredible influence over state athletic commissions. It’s the cost of doing business. In the grand scheme of things, the amount UFC spends on lobbying versus how much they actually make is chump change. They get great bang for their buck.
That was never the case in New York, however. The company desperately wanted to get MMA legislation passed in New York. Starting in November 2007, the company began an incredibly expensive $2 million lobbying campaign over the next four years that would flounder. It didn’t matter if there were shows in New Jersey or pressers at Radio City Music Hall or fighter interviews on major media outlets. As long as Sheldon Silver was in power in the New York state Assembly, they were wasting their time and money. The lobbyists got even richer.
It’s common knowledge that UFC blew a lot of cash in Albany. What is remarkable however, from a historical perspective, is to look at the actual lobbying records from November 2007 through the end of the 2015 political season to see how much UFC spent, where they spent it, and who benefited from the lobbying largesse. It also reveals the hard changes UFC had to make in strategy to take down some of America’s most corrupt politicians.
By Zach Arnold | March 29, 2016
UFC is the only major combat sports promoter that lobbies in California. They use a high-level Sacramento firm called Platinum Advisors LLC. Their point man is Tim Lynch. He has some of the biggest clients, including the Golden State Warriors. It’s also the lobbying firm of Liberty Dental, the company of California State Athletic Commission chairman John Carvelli.
Like clockwork, UFC spends 6-figures a year lobbying in Sacramento on behalf of issues related to the California State Athletic Commission. Given California’s importance, a 6-figure price tag is a cheap date if you ask me. They own the power.
Part of this power comes in strange & unusual ways. One bill the UFC tried to influence in 2015 was Assembly Bill 202, known as the Oakland Raiders cheerleader employment bill. The intent of the bill was to have California law apply to cheerleaders for sports franchises, thus converting these cheerleaders from independent contractors into employees with full labor rights. It also would have provided the possibility of… unionization. The Assemblywoman who wrote AB 202 was a labor leader.
How did UFC end up being excluded from having to classify their Octagon girls as employees in California? A look at the final text of the bill reveals…
(1) “California-based team” means a team that plays a majority of its home games in California.
(3) “Professional sports team” means a team at either a minor or major league level in the sport of baseball, basketball, football, ice hockey, or soccer.
Bingo. No application of this law to combat sports and to a non-California company like UFC which doesn’t use the team franchise business model.
This is how UFC flexes their muscle in the lobbying game. They have political control over the state Athletic Commission. The Fertittas have tentacles in the state’s gambling economy. They can do this because nobody else in combat sports is even trying to play the game. Bellator and other promoters can enjoy the fruits of UFC’s political lobbying but when push comes to shove, UFC is the first to get what they want because they actually bother to show up to do the dirty work. Even when it comes to cheerleaders.
By Zach Arnold | March 28, 2016
… is USADA drug testing as effective at catching cheaters as Nevada’s out-of-competition drug testing policy?
Answer: Yes and no.
If you follow MMA betting wizard Luca Fury on Twitter, you know that the game has changed for real since the implementation of USADA’s drug testing program. Since the implementation of USADA testing, it is now smarter and more profitable to side with the underdogs than the favorites. You used to hit on an occasional 3-to-1 underdog here and there but now your chances of making money simply with underdogs is greater than ever before. It’s not a coincidence. When you have a sport with doping problems comparable to horse racing, any threat of out-of-competition drug testing immediately creates more randomness for success in a sport that was already way more random and harder to predict than other sports to bet on.
And yet, Larry Pepe on Pro MMA Radio recently made an extremely compelling argument about how much USADA’s drug testing program is more or less about public relations first rather than a drug testing program with actual teeth. The “more bark than bite” argument.
If you support USADA’s UFC drug testing efforts, you simply can point out the obvious. Given that MMA fighters make less money than athletes in other sports, they’re not as likely to get the high-end designer performance-enhancing drugs. And if there’s anything history has taught us over the last 15 years, especially during the Testosterone Replacement Therapy era, it’s that MMA fighters are notoriously sloppy at cheating. They’re just not as good at it as their athletic counterparts in other major sports.
Not again! Andy Foster/California State Athletic Commission approved booking of 60 year old, 200-pound female boxer who got rocked
By Zach Arnold | March 27, 2016
“That is one heavy chick! 295 pounds!” … “That is absolutely awesome! 59 years of age! This is legendary!”
Nearly two years ago, we wrote a controversial article about Keela Byrd Byars, a late 50-something 200-pound boxer who had been trying for years to get licensed by the California State Athletic Commission. She could never administratively get licensed by the state of California.
Her luck changed when Andy Foster and the California State Athletic Commission board granted her a temporary license.
In May of 2014, Keela Byars fought a four-round fight for promoter Ed Holmes of All-Star Boxing in Southern California against a 40-something female boxer who was nearly 300 pounds. Watch Keela Byrd Byars’ debut fight. She shouldn’t have won a single round. Three California judges (Pat Connolly 40-36, David Denkin & Donald Howard 39-37) ended up giving her a unanimous decision. Even the announcers couldn’t spin it.
“I almost wanted one of Keela’s right hands to just connect just to stun her back a little bit.”
Byars could barely hit a 300-pound target in four rounds. The video speaks for itself.
Two years later, Byars — now allegedly in her 60s, was booked for an Ed Holmes All-Star Boxing event on Saturday night at the Westin Bonaventure Hotel against a 9-6 fighter named Laura Ramsey (age 46). This was Byars second ever fight in California and she lost.
Laura Ramsey Kos Keela Byars in rd 4 in female heavyweight bout. Byars is 60 years old 1-1 record. She leaves to cheers. #boxing
— David Avila (@AvilaBoxing) March 27, 2016
We received communication, unsolicited, from people at the show on Saturday night who were absolutely appalled by what they were seeing. The referee for the fight was Jack Reiss. What an grossly unfair situation to put him in.
Take note of this comment at The Sweet Science:
One guesses that the California commission consented to license a 60-year-old woman for fear of legal reprisals if they turned her application down. In our litigious society, the scent of trial lawyers lurking about often dictates the actions of government bureaucrats. In theory, denying Keela Byars a boxing license would have opened up the state to a lawsuit on grounds of age and/or gender discrimination. (There are two attorneys on the California commission, Martha Shen-Urquidez and Mary Lehman, the latter of whom is a former professional boxer.) It should also be noted that the commission promised to be extremely vigilant in seeing that Ms. Byars was properly matched.
The athletic commission has every right to reject a fighter based on health & safety grounds, especially someone who is in their late 50s/early 60s and HAS NEVER FOUGHT PROFESSIONALLY BEFORE. In Nevada, fighters over the age of 35 are required to petition the commission for approval. Standard operating procedure. Athletic commissions also are supposed to send officials to check out current skill levels during sparring in order to prevent massacres from happening in the ring or cage.
In other words, a racial or gender discrimination lawsuit by a licensee against the state of California would go nowhere. It would require filing a claim with the Government Claims Board. If they rejected, then you would likely petition for a writ of mandate given that it’s a licensing issue rather than a workplace/employee issue. The cost of bringing such litigation would have likely stopped a person in their tracks, especially since you have to pay attorneys up front for writ of mandates in hopes of getting your fees on the back-end if you prevail. It would simply have been easier to go to another state, with a terrible athletic commission, to get licensed to fight.
But why go to another state when California is ready to license you? Take note of what was stated in official California State Athletic Commission documentation in May of 2014:
- Andy Foster recommended the Athletic Commission grant Keela Byrd Byars a license.
- Andy Foster approved the booking of Keela Byrd Byars’ first fight nearly two years ago. At the age of 59.
- Andy Foster approved the booking of Keela Byrd Byars’ second fight last night. She is now 60.
- Promoter Ed Holmes booked Keela Byars for both of her California fights.
You want to talk about lawsuit fears from a licensee? Forget an age or gender discrimination lawsuit. Lawsuits from licensees that state athletic commissions worry about? Wrongful death & negligence/duty of care lawsuits. Combat sports are legally classified as ultrahazardous for good reason.
Exit question: How will an athletic commission like California respond to a lengthy Nevada suspension of promoter Roy Englebrecht for perjury/forgery (acts of moral turpitude) if they don’t care about integrity in boxing? It’s time for the Department of Consumer Affairs to step in and read the riot act before things completely spin out of control.
By Zach Arnold | March 23, 2016
Things just escalated very quickly for California-based combat sports promoter Roy Englebecht and the Nevada State Athletic Commission.
Nevada, which temporarily suspended both Englebrecht and boxer Zab Judah over allegations of falsified paperwork, revealed more details on Wednesday morning regarding the pending charges being filed against both men.
The pending charges against Roy Englebrecht
Nevada’s Attorney General office claimed on Wednesday morning that promoter Roy Englebrecht not only committed perjury regarding paperwork he filed on behalf of Zab Judah but also claimed that he was guilty of forgery and violation of state law regarding possession of Judah’s social security number to put on the fighter’s application form.
According to the Athletic Commission, Englebrecht was summoned to meet with Executive Director Bob Bennett on March 10th regarding the commission’s investigation into back child support that Judah allegedly owed. That investigation supposedly revealed that:
- Judah had “lied” to two other athletic commissions regarding back child support he owed
- Judah owes approximately $240,000 in back child support in three different cases (court orders)
- Judah allegedly did not have an official payment plan in place to pay off his debts and that to be licensed in Nevada you must have payment plans in place before applying for a license
- Judah allegedly lied on his paperwork by not disclosing on his licensing paperwork the back child support he owed as a lien or a garnishment
The commission claims that Englebrecht was notified of Judah’s back child support owed and asked to find a replacement fighter for the Downtown Las Vegas Events Center event that was scheduled to air on CBS Sports Network. A replacement fighter and promoter could not be found in time to save the show.
According to the AG’s office, Englebrecht supposedly admitted to Bob Bennett that he had filed licensing paperwork on behalf of Zab Judah and that 1) he had not only forged Judah’s signature but 2) also put the fighter’s social security number on the paperwork.
What was not addressed at Wednesday’s meeting by either the athletic commission or Roy Englebrecht was motive as to why Englebrecht, rather than Zab Judah or Judah’s manager, filed the licensing paperwork with Nevada in the first place.
The athletic commission requested a continuation on the temporary suspension of Roy Englebrecht until a formal complaint is filed against Englebrecht. That complaint will supposedly allege that Englebrecht committed multiple specific intent crimes of moral turpitude.
Under oath at Wednesday’s athletic commission hearing, Englebrecht gave testimony without an attorney speaking on his behalf. Englebrecht did not dispute the pending allegations brought against him. Englebrecht stated that he damaged the trust between him and the athletic commission.
“I damaged that trust and failed you.”
Englebrecht said that he would “accept full responsibility.”
“I made a mistake. It was poor judgment.”
The problem for Roy Englebrecht is that perjury and forgery are specific intent allegations, not general intent crimes of mistake.
After accepting the preliminary allegations made against him by the athletic commission, Englebrecht went into a mini-stump speech about being a 70-year old fight promoter with an extensive 31 year history of promoting club shows all over the country and never once bouncing a check or screwing over regulators.
“I feel I am a true fight promoter.”
The Attorney General’s office stated that they would issue the formal complaints against both Roy Englebrecht and Zab Judah in the coming weeks and allow them due process to formally respond to the charges. It is expected that formal disciplinary hearings against both Judah & Englebrecht will take place in May.
Nevada’s athletic commission excoriated Englebrecht on Wednesday morning, asking how they or other athletic commissions could trust his word or the word of fighters working with or associated with Englebrecht in the future given his admission of both perjury and forgery in the Zab Judah case.
The major shoes to drop soon
- Will California honor Nevada’s temporary suspension of Roy Englebrecht?
- Will California honor Nevada’s formal suspension of Roy Englebrecht after May’s disciplinary hearing? Englebrecht has events coming up in April, May, and June. A formal suspension of Englebrecht would cost both he and the California State Athletic Commission significant cash in lost revenue.
- When Englebrecht is suspended by Nevada’s athletic commission, will the California State Athletic Commission allow Englebrecht to run events under the rent-a-license Promoter-In-Name-Only scheme that we often see in action for Southern California fight events?
Last week, we requested formal comments from both Englebrecht and the California State Athletic Commission regarding Nevada’s suspension and neither camp responded to our requests.
By Zach Arnold | March 22, 2016
American politics swim upstream from popular culture.
For nearly a decade, proponents of Mixed Martial Arts have done everything in their power to get MMA legislation passed. As long as Sheldon Silver existed, it wasn’t going to happen. The beneficiaries of this political roadblock were the New Jersey and Pennsylvania athletic commissions. Over time, those commissions not only embraced MMA but took pride in actually regulating events. I don’t worry about the Nick Lembos of the world in terms of competency.
I worry about the Michigan, Texas, and New York athletic commissions — a lot. Places with big markets, toxic politics, and bureaucrats who half-heartedly care about combat sports other than getting some event tickets for themselves, friends, and the donor class.
For long-time friends and associates who have fought their asses off in New York to get the sport regulated, I salute their heart and determination. Jim Genia is a hero and one of the highest-character people I’ve ever dealt with in combat sports.
We know how the New York playbook likely is going to work. Scott Coker and Bellator will attempt to beat UFC and run the first major MMA event in the state. UFC will come in and run Madison Square Garden once, then run some Fight Nights over the next couple of years before largely abandoning the East Coast for a once-a-year type schedule. All the financial promises of bringing in tens of millions of dollars is just blowing smoke.
I will still appreciate the magnitude of UFC finally running Madison Square Garden and I hope the fans who show up to MSG demonstrate their support as well. It will be hard to have a dead crowd if Jon Jones is headlining the MSG event.
The combat sports regulatory system of dysfunction in New York was out of control. At least there will be a framework moving forward. However, that framework does not guarantee good regulation. New York’s athletic commission is so far behind the learning curve, New Jersey and Pennsylvania will continue to demonstrate a higher level of competence. My lowest expectation of New York is that they can match Texas in competency and that’s just awful.
The politicians were a decade behind the curve in approving MMA legislation. The populace has moved on. UFC fighters are featured on television all the time. Ronda Rousey didn’t need New York to become a household name. New York missed an opportunity to become part of the conversation and to become part of the UFC’s history in regards to their push to become a mainstream sports topic. New York politics never misses an opportunity to miss an opportunity.
There is a great irony, however, in New York passing MMA legislation now during a time when there is so much political & media scrutiny on contact sports like the NFL over the issue of concussions & CTE.
Which reminds me what a great time it is to plug Jim Genia’s book, Raw Combat: The Underground World of Mixed Martial Arts
Exit question: Now that the Fertittas have accomplished their goal in getting New York MMA legislation passed, does it accelerate or cement their timeline in selling UFC?
By Zach Arnold | March 16, 2016
— TheSweetScience (@TSSboxingnews) March 12, 2016
Veteran California boxing & MMA promoter Roy Englebrecht is in a hell of a mess and it could not only cost him money but also cost the state of California money if the Nevada State Athletic Commission suspends him.
Last Friday, the Nevada State Athletic Commission indefinitely suspended both boxer Zab Judah and promoter Roy Englebrecht. Nevada’s commission is publicly claiming that both Judah & Englebrecht “falsified” paperwork submitted to the commission. The initial media report suggested that Judah & Englebrecht allegedly did not disclose back child support that Judah supposedly owes. Late Friday, it was publicly reported that Englebrecht filed paperwork on behalf of Judah with Nevada’s athletic commission.
It is standard operating procedure for athletic commissions to pay off owed back taxes or child support via the fight money purses.
The Nevada State Athletic Commission/Attorney General’s office has not disclosed their full case against Judah & Englebrecht. They will make their case next week to the public. Therefore, it is impossible at this point in time to fully understand the detailed scope of the allegations.
Judah was scheduled to main event a Saturday fight card at the Downtown Las Vegas Events Center. CBS Sports Network was scheduled to televise the event. Roy Englebrecht was the promoter for the show. After Nevada’s athletic commission suspended both Judah and Englebrecht, there wasn’t enough time to find a substitute promoter to save the show. The arena lost the show booking. The athletic commission wasted time and lost money. Fighters on the undercard lost out on pay days.
As a result of the Nevada State Athletic Commission alleging “falsified” paperwork from both Zab Judah & Roy Englebrecht, economic damage occurred with the cancellation of the show. You have fighters, an arena venue, an athletic commission, and a television partner all involved in a show that ended up not occurring.
What is fair punishment and fair compensation?
Next week, both Zab Judah & Roy Englebrecht will be summoned to Las Vegas to address the athletic commission board about the supposedly falsified paperwork. The commission has the option of suspending and fining both men.
For the Downtown Las Vegas Events Center, how will the arena recover money from the economic damage caused by the alleged actions of both Judah & Englebrecht? There are two key causes of action to focus on: breach of contract (nonperformance) and misrepresentation (fraud). Misrepresentation carries the weight of economic damages plus punitive damages. Breach of contract does not carry punitive damages.
How do you prove mens rea?
The hurdle is proving intent when alleging perjury.
It’s one thing to argue negligence. It’s another thing to argue fraud in of the inducement by meeting the standard of providing clear & convincing evidence in an administrative hearing.
How do you prove intent rather than mistake via error of omission?
How do you prove that Roy Englebrecht knew about back child support that Zab Judah allegedly owed? The theory of strict liability is one thing — but strict liability does not equal proving intent.
Anything that Judah or Englebrecht say under oath at next week’s athletic commission meeting can and will be used against them in a civil court case, either filed by the Attorney General or by attorneys from business partners involved in the cancelled Las Vegas event. Any statement made at next week’s hearing under oath that the AG’s office determines to be false is under felony penalty of perjury.
The athletic commission could determine that the actions of both Judah & Englebrecht were negligent… or they could determine that the actions were intentional. This would be very significant in regards to how much money both Judah & Englebrecht could, in theory, owe to their business partners in damages from last Saturday’s cancelled event. How significant? Punitive damages means three times the damages originally suffered from breach of contract (nonperformance) if intent to conceal or misrepresent vital information is factually proven.
Steve Carp’s report in the Las Vegas Review-Journal newspaper claimed that the fight event was sold out.
Could the Attorney General’s office propose a global settlement for all parties involved or could the Athletic Commission/AG’s office pursue their own line of punishment and allow the business partners in the cancelled Vegas show to file their own civil suit?
California could suffer as well
Given the recent policies imposed by the California State Athletic Commission for the cost of doing business on the independent show level, the net result of those policies has placed a heavier emphasis on bigger shows and less of an emphasis on grass roots events.
Of the remaining grass roots promoters in California, Roy Englebrecht and Ken Thompson are the two most established in the state of California. Englebrecht not only runs events in Orange County but also advertises an endeavor called Fight Promoter University where he and many California-based insiders teach people the ins-and-outs of promoting combat sports. These events can be big-time socializing events with power players in the fight business.
Englebrecht is one of the very few grass roots promoters in the state of California who has not only survived but managed to carve out a profitable market for himself. That, in turn, means real cash for the California State Athletic Commission. Roy means business and business means something to Sacramento.
Roy has several events scheduled for the rest of the 2016 calendar. Those events could very well be threatened if the Nevada State Athletic Commission suspends him. It would put the California State Athletic Commission in a terrible position.
- The California State Athletic Commission could ignore Nevada’s suspension, resulting in an escalation of tensions between two of the biggest athletic commissions in the country. The subplot of Bob Bennett, who beat out Andy Foster for the Nevada State Athletic Commission Executive Director position, going to war with California would be newsworthy. Or…
- The California State Athletic Commission could honor Nevada’s suspension and potentially lose 5-figures in lost revenue from future events that Roy Englebrecht is scheduled to promote in 2016.
We requested an official statement from the California State Athletic Commission on Monday morning. The athletic commission did not respond to our inquiry.
We sent an inquiry to Roy Englebrecht on Tuesday morning asking for an on-the-record comment about what kind of contract he had with the Downtown Las Vegas Events Center. We have not received an official response at the time of publication of this article.
By Zach Arnold | March 5, 2016
You could not have dreamed up of a costlier scenario for UFC. They got schlonged the hard way and created this matchmaking disaster by maximizing risk and minimizing Return on Investment.
Nate Diaz submitting Conor McGregor. Talk about a Pyrrhic victory. UFC management may be gleeful that McGregor was taken down and had his dreams of boxing-style business dealings shattered but look what it just cost them in the long run. The cherry on top of this sundae is that the Diaz Brothers once again have real power in the sport of MMA. The greatest MMA characters in the history of Western Civilization and giant pain in the asses for Zuffa to deal with. I love it.
Instead of protecting McGregor and canceling his fight due to RDA’s injury, they pressed on with the PPV because they didn’t want to cancel. They booked McGregor against a naturally bigger fighter. Amazing.
If that gamble wasn’t one-sided for you, Dana White swore on his family that he would not book Holly Holm in a match other than a re-match with Ronda Rousey. Instead, Holm’s camp wanted to fight and Ronda needed a longer-than-expected break. Result? Book a “safe” fight with Miesha Tate and half-ass the promotion of it. The result? Miesha won the title and now UFC is chasing its own tail trying to figure out what to do next.
Buster Douglas trended on Twitter after both Conor & Holly lost. Buster Douglas is permanently etched in the minds of every sports fan some 26 years later. Holly losing was *very* bad for her but not a doomsday scenario for UFC given Miesha’s popularity and marketability. Conor McGregor is a doomsday scenario, however.
Neither of these risks by UFC management were necessary but they took them anyways and tactically backed themselves into a corner. Compare this strategy to what we’ve recently seen in Bellator.
Bellator has been booking MMA legends fights. They’ve booked freak show fights. Kimbo Slice is as big of a draw in 2016 as he ever was during the Gary Shaw days. Shamrock vs. Royce was miserable and Kimbo vs. Dada was historic for all the wrong reasons, including Dada’s post-fight hospitalization. But there were no titles at stake. It was simply booking fun fights. The risk was either extreme entertainment or embarrassment.
Bellator just signed Wanderlei Silva to a contract. Right before Bellator announced this signing, there was talk about Wanderlei showing up for the April RIZING event. The talk? About RIZIN promoting an MMA Legends series. Very similar to Bellator. With Wanderlei still on suspension from Nevada, it’s likely that he will fight in RIZIN sooner rather than later. The idea of an MMA Legends series sounds fun on paper but awful in execution. There are risks in promoting this concept but they are not multi-million arbitrary short-sighted risks like UFC is often wont to do. There’s a time for taking risks but the risks UFC often takes are real head-scratchers.
Best case scenario for UFC with the women’s title? Ronda Rousey (Hulk Hogan) losing to Holly Holm (Ultimate Warrior) losing to Miesha Tate (Sgt. Slaughter), with Rousey vs. Tate now having a shiny new angle to another re-match.
UFC was also trending for the wrong reasons after the McGregor fight. Mainly, Floyd Mayweather was trending because of another UFC/media-concocted storyline about a McGregor/Money fight. They deserve the scorn they are receiving online right now.