Dion-Vera Suit Accuses Zuffa, White, & Silva of Interference with Contract

It appeared that the management dispute between Mark Dion and Brandon Vera was resolved in an arbitration hearing in front of the CSAC earlier this year. However, MMAPayout.com has learned that Dion filed suited against Vera and his new management team in civil court in California on May 1.

The complaint closely follows the contours of the arbitration proceedings, except for the inclusion of Zuffa, White, and Silva for allegedly interfering with Dion's management contract with Vera. Specifically the complaint alleges that Zuffa and its officials encouraged Vera to breach his contract with Dion and provided him with confidential emails to use in that effort.

Hands On: White Taking a More Active Role in Talent Relations

No one has ever accused UFC President Dana White of being lazy. Even his biggest detractors recognize and respect what is often described as his unparalleled work ethic. White is famous for his attention to detail, or micromanaging depending on your prospective, in every aspect of Zuffa's business. However, prior to Randy Couture's resignation there was one area where White had reportedly become somewhat withdrawn: talent negotiations.

Prior to Couture's resignation, sources have indicated to MMAPayout.com that White was generally content to leave talent negotiations in the hands of the UFC's highly regarded Vice President of Talent Relations, Joe Silva. Sources now tell MMAPayout.com that White has become much more hands on in talent negotiations this year, personally meeting with a number of his top fighters' managers. It now apparently not uncommon to bump into various managers and agents on visits to the UFC's headquarters in Las Vegas.

This new proactive approach is believed to be the result of Couture's resignation. White has both publicly and privately expressed his belief that the Couture situation was something of a wakeup call that the communication between the UFC, and himself in particular, and its fighters, and by extension their managers and agents, wasn't what it needed to be.

Noons Turns Down EXC on CBS

The San Diego Union-Tribune ran a feature last weekend on the rise of MMA in the context of EliteXC's recent CBS deal. The most interesting note in the piece to regular followers of the industry was the following tidbit on EliteXC's insistence on exclusive contracts:

According to Dion, Noons (6-1) tentatively was scheduled to appear on this card, but before EliteXC would offer him a contract, it wanted him to commit to three additional matches under its stewardship. Dion would not commit.

“They're trying to slam-dunk guys into long-term contracts in order to be on CBS,” Dion said.

You may remember Dion from the recent coverage of his dispute with Brandon Vera.

Fraud Against Fedor?

The Korea Times reports:

South Korean prosecutors indicted the local chief of a Russian martial arts agency for fraud Monday after he allegedly used the publicity rights of Fedor Emelianenko, the famed Russian mixed martial arts fighter, without consent.

Emelianenko filed the suit early this month over a "shoddy" honey commercial that went on air on Korean cable television featuring his image. The world heavyweight champion sought 1.55 billion won ($1.6 million) in compensation from the president of Korea Sambo Federation and the head of a local apiculture agency whose honey product the commercial promoted.

Vera's Management Dispute Provides Rare Glimpse Into UFC Negotiations

Brandon Vera's dispute with his former manager, Mark Dion, was recently settled in an arbitration hearing before the California State Athletic Commission. The commission ruled in Dion's favor and the entire affair is documented on Dion's website, CityBoxing.com. The myriad of documents made available by Dion provide a rare public glimpse into the UFC's negotiation tactics.

The entire affair was detailed by the Canadian Press. The highlights:

• Vera's second three-fight UFC deal (renegotiated prior to the expiration of his original contract) started at $16,000/$16,000 (win bonus), $20,000/$20,000, and $24,000/$24,000. The deal also included a $100,000 signing bonus.
  
• Two fights into that deal, following Vera's knockout of Frank Mir at UFC 65 in November 2006, the UFC approached Dion to negotiate a long term deal. The UFC flew Dion to Las Vegas to meet with Dana White. White gave Dion two offers on a post-it note:
• A three fight deal at $90,000/$90,000, $100,000/$100,000, and $115,000/$115,000 with an automatic upgrade to $150,000/$150,000, $170,000/$170,000, $185,000/$185,000 provided Vera became Heavyweight Champion, or
• A four year deal worth $7 million. Dion testified that White made a verbal offer of a $100,000 bonus if Vera won the title.
  
• Dion told the CSAC that the post-it note was standard operating practice:
  
• "UFC doesn't send no letters, period. They've tried to avoid all that stuff... This is all I got from Dana White. This is all I could show to Mr. Vera. There was no e-mails. Dana White likes to keep - keep himself covered on all aspects."
  
• Dion made an admittedly outrageous counter offer three days later in an effort to move negotiations. The two options presented were:
• A one-year three-fight contract at $150,000/$150,000, $175,000/$175,000, and $200,000/$200,000 with a $1.5 million signing bonus, or
• A guaranteed three-year ten-fight contract worth a total of $9 million ($3 million per year) plus a $1.5 million signing bonus. Vera would also receive a $1 million bonus if undefeated at the end of each year.
  
• In response, Joe Silva, VP of Talent Relations, offered a three fight deal at $50,000/$50,000, $60,000/$60,000, and $70,000/$70,000, escalating to $90,000/$90,000, $100,000/$100,000, and $110,000/$110,000 if Vera became champion along with a $100,000 signing bonus.
  
• Dion rejected the offer in an email to White at 4:46 PM on December 26. At 7:16 PM the UFC replies, saying it is exercising its right to extend the contract by three months per Vera's refusal to fight in June due to injury.
  
• Dion informs the company that Vera was never injured and was ready to fight as soon as possible. He hires a lawyer in January to contest the company's three month contract extension.
  
• In March Vera tells the UFC not to deal with Dion anymore.
  
• Vera's attempted to void his management contract with Dion goes to arbitration in September, claiming he was never informed of the $100,000 signing bonus offer.
  
• In October, after an 11-month layoff, Vera returns to the UFC in a loss to Tim Sylvia with a reported purse of $100,000.
  
• The CSAC ruled in Dion's favor earlier this month, finding no illegal conduct,but severed the management contract (which ran through 2010) due to deterioration of their relationship.
  
• Dion received one-third of the Sylvia fight purse as well as $100,000 in consideration of future fight purses.
  
• Garcia said: "It seems to the arbitrator that the ambiguity of the Post-it note, which appears to be the root of the current dispute, could have been avoided if the UFC had put their offer in the form of a proposed contract and sent it to (the) manager."

Vera subsequently re-signed with the UFC and will face Fabricio Werdum at UFC 85.

MMA Goes Hollywood

The latest issue of FIGHT! magazine is now available on newsstands. I have a piece called "MMA Goes Hollywood" focusing on the growing profile of MMA in Hollywood with quotes from Dana White, Randy Couture, and Couture's sports and acting agents. Key quotes to wet your appetite:

“Most of these athletes at the end of the day want to take the celebrity that they’ve built on the field or through their sports and translate that into other opportunities whether that is business, entertainment, or whatever they may want to do,” Matt Walker (Couture's sports agent) said. With Gersh, “I don’t have to go outside of this office, all I have to do is push the buttons, find the people here that believe in MMA, believe in my client in the same way, and then you can do it all internally.”
...
As a fighter, Couture sees Gersh’s involvement as a welcomed development. “I think that there are a lot of athletes out there in our sport that are being misrepresented. They’re not being done justice in their fight careers. I think a lot of those purely fight managers don’t have the capability of helping athletes try to diversify and make the transition somewhere else.”
...
“They’re parasites and what there job is to tell you how fucking great you are, how many other things you could be getting, how badly your getting fucked, and how much better they’re going to make your life,” Dana White said. “That’s there job. But with most of the things that these guys tell these fighters, they’re lucky if thirty percent of it comes true.”

In only four issues FIGHT! has become the largest MMA publication in North America with over 6,000 subscribers and available in bookstores like Barnes & Noble and Borders nationwide. Since its inception the publication has gone from a bi-monthly format to monthly and expanded into Canada with expansion into Europe, Mexico, and Latin America on tap in the not too distant future. As part of an aggressive marketing plan, a full year subscription (12 issues) is now available for $18.95, at least $10 below the competition and 65% off the cover price.

Thanks to Donovan Craig and Matt Brown at FIGHT! who are both a pleasure to work with.

Lawsuit Provides Glimpse Into Elusive World of Fighter Representation

Sherdog.com recently broke the news that Reed Wallace, President of White Chocolate Management, was suing Quinton Jackson and his manager Juanito Ibarra for breach of contract. In a prepared statement, Wallace's attorney said that in order to end the legal proceedings, which ask for $10,000,000 in damages, Jackson must "let White Chocolate do its job without interference and honor his contract. The alternative is to go the distance. The decision is his."

Fightlinker.com recently posted the complaint which was filed in the Supreme Court of New York on 12/26/07. The complaint is an interesting, if lengthy, read and provides a rare on the record glimpse into the field of fighter representation and management while putting figures to some ancillary income sources in the process.

Wallace had a non-exclusive entertainment manager's contract with Jackson. Ibarra has a more powerful fight manager contract with Jackson and as a result manages Jackson's career. Ibarra seems to have felt that Wallace's commission rates (details below) were exorbitant and is accused of trying to sabotage Wallace's efforts on Jackson's behalf as a result, including making deals Wallace originally presented through other channels in order to circumvent his commission.

Juanito told Sherdog.com:

Anybody that brings me a deal worthwhile -- anybody -- with a contract or no contract, if it has integrity value about it, then I'll take care of that person. I'll give them 10 percent -- that's always been me and that will always stand... I'll turn down money. If it's not right for our business or image, we're not doing it... If I turn down a deal, I'm allowed to turn down a deal. It's our right."

It also seems clear that Jackson signed non-exclusive arrangements with a number of entertainment managers in addition to Wallace creating confusion as to his true representation and resulting in a flood of offers for Ibarra to sort through. This is a common occurrence in the industry since many fighters have trouble saying no to people, especially those offering potential riches for nothing more than a non-exclusive contract and a hefty commission on potential deals. Unfortunately, the result is disorganized, fragmented representation that often frustrates potential opportunities. It is one of many examples of how far the representation and management of fighters has to go.

The complaint provides details on a number of deals Wallace allegedly secured for Jackson, including:

• A guest appearance for Rampage at $10,000. This seems to be a fairly standard range for stars, however, MMAPayout.com has learned that the mega stars of the sport can command as much as three or four times that amount. In support of that contention, the complaint also lists offers of $25,000 and $50,000.
  
• A Wal-mart t-shirt deal with a $30,000 advance.
• A book deal with a $20,000 signing bonus and potential $500,000 advance.

The entertainment management agreement that Jackson signed with Wallace is attached to the complaint as an exhibit. Among the notable details of the arrangement:

• Jackson agreed to pay Wallace 20% (which largely represents the industry standard) of his gross compensation secured by Wallace.
  
• Wallace would continue to receive a commission on compensation from deals secured during the term of the agreement but accruing to Jackson after the expiration of the agreement at the rate of 15% in the first year, 10% in the second, and 5% in the third.
• A cellular ring tone and wall paper deal for 54% of all revenue generated.

Special thanks to Ryan at Fightlinker.com

Couture’s Agent Refutes Report as War of Words Continues

I have the first public comments from Randy Couture's agent, Matt Walker, regarding Couture's reported salary up at Sherdog.com. The article also provides a preliminary legal analysis of the reported "retirement" clause in the contract. Key quote:

Late Wednesday, Couture's agent Matt Walker told Sherdog.com the figures reported by Yahoo! were "extremely inaccurate" based upon what Couture had been told were pay-per-view numbers from the UFC heavyweight champion's last two
fights. "When I first read the story on Yahoo! I actually laughed because they are so far from fact," said Walker.

Full story available at: Couture’s Agent Refutes Report as War of Words Continues

Update on Team Takedown

Team Takedown has been a topic of discussion in recent months. Ted Ehrhardt's concept is a new take on MMA management, closing resembling a baseball academy model, in which some of the country's top college wrestlers were signed to contracts and are being groomed for MMA.

The four team members made their debuts on September 28 at The Night of Champions event in Oklahama City to mixed results. The show drew a sellout crowd of 1,652 and was broadcast live on the internet for $9.95 with a money back guarantee. Johny Hendricks (24 years old, 2005/2006 NCAA Champion, 2007 Runner-up) was victorious in his pro debut due a cut stoppage in the third round. Jake Rosholt (25, three-time NCAA Champion) also won by stoppage in the third round. Shane Roller and Eric Bradley both lost.

According to an article in USA Today, all four wrestlers/fighters were signed to contracts with $100,000 per year downside guarantees. All four train at Extreme Couture in Las Vegas. The group is reportedly involved with HDnet FiGHTS and Guy Mezger was in Henrick's corner for the fight.

Correction - Jake Rosholt and Eric Bradley made their MMA debuts on July 21 and both were victorious. Johny Hendricks and Shane Roller debuted on September 28.