MAY 2017

DEVOTED TO LEADERS IN THE INTELLECTUAL PROPERTY AND ENTERTAINMENT COMMUNITY

VOLUME 37 NUMBER 5 THE LicensingJournal Edited by Gregory J. Battersby and Charles W. Grimes referred to himself as the grim Praxis reaper. In February 2015, the defen- dant moved to dismiss the plead- ing on Twombly grounds. [See Bell Atlantic Corp. v. Twombly, 550 U.S. Antitrust 544 (2007).] ’s primary argu- ment was that the plaintiffs had Stephanie Gyetvan failed to plausibly allege that its exclusive dealing agreements with and Jonathan H. Hatch fighters were anticompetitive. At a September 2015 hearing, the The UFC’s Biggest UFC to extend a fighter’s contract court issued an oral decision deny- when he or she is a champion (and ing Zuffa’s motion. Bout Yet: Its most marketable); (2) an ancil- Since the court’s ruling, the par- Fighters’ Antitrust lary rights clause that grants the ties have been engaged in wide- UFC the fighters’ exclusive and ranging discovery. A review of the Lawsuit perpetual worldwide personality court’s discovery rulings indicates There currently is an antitrust and identity rights for all commer- that Zuffa must produce documents litigation that is enveloping the cial purposes; (3) a promotions from at least 22 custodians and mixed (MMA) world. clause that requires the fighters to must respond to 25 interrogatories. Six current and former MMA promote bouts for no additional The court also increased the num- fighters have filed a class action compensation; and (4) a sponsor- ber of depositions available under lawsuit against the company ship and endorsement clause that the Federal Rules to 45 per side. that owns the Ultimate Fighting grants the UFC the sole discre- More recently, a third party has Championship (UFC), Zuffa, LLC, tion to approve a fighter’s spon- challenged the expansive nature of for violations of the Sherman Act. sorship and endorsement deals. the discovery sought in the Zuffa [Cung Le, et al. v. Zuffa, LLC, d/b/a The plaintiffs also claim that the litigation. On February 22, 2017, Ultimate Fighting Championship UFC has retaliated against fighters Bellator Sport Worldwide, LLC, a and UFC, Case No. 5:14-cv-05484, who work or threaten to work for rival MMA promotion company, U.S. Dist. Ct. N.D. of .] other promoters and against fight- filed a motion to quash subpoe- A review of the docket indicates ers who have refused the UFC’s nas served by the plaintiffs and that the UFC will have to go a few contractual terms. Zuffa. Bellator claims that while it more rounds before it has another The Amended Complaint also has produced thousands of pages opportunity for a . attributes statements to Zuffa’s of documents in response to the The putative class plaintiffs owners and officers as evidence subpoenas, it objects to produc- allege that the UFC has monop- of anticompetitive intent. The ing documents concerning its con- oly or monopsony power in two plaintiffs allege, for example, that tracts and negotiations as well as markets: (1) the market for pro- Zuffa’s president boasted: “There its revenues and expenses. Bellator motion of live MMA bouts, and is no competition. We’re the NFL. objects to producing these confi- (2) the market for professional You don’t see people looking at dential materials to its rival and to MMA fighting services. The plain- the NFL and going, ‘Yeah, but he’s the athletes with whom it negoti- tiffs claim that the UFC receives not the best player in the world ates. Bellator’s motion to quash 90 percent of the revenues from because there’s a guy playing for has not yet been fully briefed. MMA bout promotion and that the Canadian Football League MMA fighters do not have the or the Arena League over here.’ Jonathan Hatch is Counsel in the ability to work for MMA promot- We’re the NFL. There is no other litigation department of Patterson ers other than the UFC. guy.” (emphasis in original). The Belknap. Mr. Hatch’s practice The plaintiffs’ claims regarding president also allegedly posted a focuses on antitrust, complex com- the UFC’s allegedly anticompeti- video to YouTube that showed a mercial actions, and white collar tive scheme partly rely on the fight- tombstone that listed the dates of defense and investigations, and he ers’ exclusive-dealing contracts death for other MMA promoters. has handled a wide variety of liti- with the UFC, which include: (1) a After reading the other promot- gation at all stages, including pre- champion’s clause that allows the ers’ names, the president allegedly litigation counseling, discovery,

MAY 2017 The Licensing Journal 1 dispositive motions practice, Stephanie Gyetvan is an associ- G. Gardephe, US District Judge mediation, trial, and appeal. He ate in the litigation department of for the Southern District of New received his JD from New York Patterson Belknap. Prior to join- York. She received her JD from University School of Law and his ing the firm, Ms. Gyetvan served Columbia Law School and her BS AB from Harvard University. as a Law Clerk to the Hon. Paul from Georgetown University.

Copyright © 2017 CCH Incorporated. All Rights Reserved. Reprinted from The Licensing Journal, May 2017, Volume 37, Number 5, pages 13–14, with permission from Wolters Kluwer, New York, NY, 1-800-638-8437, www.wklawbusiness.com