Sports Agent and Sports Lawyer Blog

Sports lawyers around the country are starting to take increasing notice of MMA. As MMA moves further into the mainstream and the amount of money at stake continues to soar, you may see more lawsuits such as the Fedor-Affliction Entertainment dispute currently raging in California.

This week the court denied the defendant’s motion to dismiss, which is not necessarily a harbinger of things to come, as the standard to survive a motion to dismiss is not a high threshold. Sherdog provides its usual expert analysis and summary of the sports lawsuit by attorney J.R. Riddell:

In the suit, the world’s No. 1-ranked heavyweight and M-1 claim that Affliction breached the “Fight Agreement” requirement to stage and promote a third bout for the fighter after advertised opponent Josh Barnett was refused a license in California for an alleged positive steroids test two weeks before the event. They claim that Affliction did not undertake “all reasonable efforts” to find a fighter to replace Barnett, and even go so far as to argue that Affliction lost interest in promoting the third bout partly because it was apparently pursuing a competing objective at the same time -- repairing its soured relationship with competing promoter, Zuffa LLC, parent company to the UFC. Shortly after Affliction’s decision to cancel the event, the UFC announced that it had reached a sponsorship agreement to allow the previously banned clothing brand back into its shows.

These days, anyone who is looking to dabble in MMA can find a local gym with an octagon and a trainer willing to train you to be the next UFC star. Now, however, UFC itself has taken the grass roots concept to a new level.

I have said before that UFC has been savvy in its growth efforts over the past several years as the sport has gradually shifted into the mainstream. The latest venture, UFC-branded fitness center, is just the next step in the process.

The gym features the traditional assortment of weights, treadmills, exercise bikes and other aerobic equipment, along with television monitors and blaring music. But the major differences are the obvious UFC trappings. An Octagon in the center of gym is used for martial arts classes. Huge wall photos of UFC Hall of Famers and life-sized cardboard cutouts of current stars decorate the interiors.

The idea is brilliant, as it exposes several types of fans to the sports. First, you have the amateur and budding MMA fighters who love the sport, practice it at an amateur level and maybe hope to hit the big time. Next, you have the casual fans who will work out at the gym, never set foot in the Octagon, but absorb the MMA theme, and become interested in the sport. The concept additionally provides an extra income stream to UFC fighters, as individual stars will have their names applied to each gym.

It also is another way of breaking down whatever negative stigmas exist by making the brand name part of communities and marketing the fighters as larger-than-life stars to families. It also creates new venues to market the company’s stars and major events, as part of the concept includes regular personal appearances by fighters at the gyms.

As always with ventures spearheaded by Dana White, this development bears watching for agents and sports lawyers who are thinking of expanding their base into representing MMA fighters.

After news that Charles “Krazy Horse” Bennett was arrested yet again last week, you have to wonder how long he will continue to last as a big-time fighter.

Last week he was arrested for fighting a teammate. This sounds like something out of a bad movie:

“During routine sparring, tempers flared between Charles and the other fighter, and Charles ended up getting dropped by the larger training partner,” wrote Vaughn. “They were quickly broken up and Charles left the mat, got dressed and left the building. He returned about 15 minutes later, walked down to the training area and pulled out a heavy piece of steel he must have found in the parking lot and began attacking the other fighter (from behind) with intent to do serious damage. He was tackled by two other fighters and disarmed.

The incident in isolation might not have been significant, but it is yet another in Bennett’s long history of legal problems. The Sherdog.com article notes that he has been arrested for crimes ranging from “traffic violations and drug distribution to kidnapping and battery upon a pregnant female.”

The reason we need to keep an eye on this sort of thing is that guys like Bennett give the entire sport of MMA a black eye. With so many positive developments, such as the approval of MMA in Massachusetts, Brock Lesnar’s return and the sport on the verge of the mainstream, naysayers will continue to point to people like Bennett as the reason that MMA will never take off.

NASCAR and a race promoter in Milwaukee have settled their lawsuit over non-payment of nearly $2 million for two races last June.

The lawsuit, which focused on fraud in the inducement, settled for confidential terms. One media outlet reports that there are still “hard feelings” based on the statement that NASCAR issued after the settlement:

“While we’re glad to settle the litigation, this is a very unfortunate conclusion. NASCAR has loved racing at the Milwaukee Mile for nearly 20 years and our fans deserve better. We depend on strong partnerships in each community where we race to make the events exciting and successful for everyone.”

NASCAR will apparently no longer race at Milwaukee Mile. According to the article, the Mile still has multiple additional legal problems.

Today we have news that a new professional basketball league has been launched. This one has an unusual caveat: The players have to be white.

The mayor of Augusta, which will apparently be getting a team, sums up the prevailing sentiment:

"As a sports enthusiast, I have always supported bringing more sporting activities to Augusta," he said. "However, in this instance I could not support in good conscience bringing in a team that did not fit with the spirit of inclusiveness that I, along with many others, have worked so hard to foster in our city."

Usually I keep politics and social commentary out of this blog, but I have to say that a race-based basketball league does not sit well with me for what should be obvious reasons. The legality of the league's structure is questionable, and raises interesting theoretical legal questions about private entities setting up entry barriers. Sometimes, however, just because something may not be illegal, does not make it a good idea.

Gender discrimination lawsuits, especially by coaches, are typically brought by females. However, as a Pennsylvania trial court ruled recently, male coaches can bring sex discrimination lawsuits as well.

Former Lock Haven University swim coach George Garlick filed a sex discrimination lawsuit, alleging a hostile workplace environment which led to his dismissal in 2005. According to this article, Garlick was a successful coach who turned around the men’s and women’s teams from perennial cellar-dwellers to top-ranked programs.

It is also interesting to note that Lock Haven has faced six sports lawsuits against the university and/or athletic director over the past several years. In a seventh lawsuit, the athletic director herself, has sued certain parties. While Garlick alleges that the athletic director and university prefer female coaches, the former field hockey coach settled for $200,000 to dismiss her lawsuit contending that females were paid less than males.

When the trial court denied summary judgment for the defendants, it signified that the case is headed for trial later this year. While Garlick still has a long way to go to prove his sex discrimination case, the lawsuit should serve as a reminder that men, in addition to women, have the right to redress their grievances in court if they feel they have been discriminated against.

A coach's sports lawsuit in California was reinstated by the state’s appellate court.

David Ohton, a strength coach at San Diego State University, was tabbed as a whistleblower for cooperating with an audit that revealed athletic department mismanagement. He alleges that he was then removed from his job, although he still works for the baseball team and other sports.

After investigating Ohton’s whistleblower complaint, CSU said in a letter of determination that Ohton was retaliated against but dismissed it as “minor” retaliation. The university also said his removal as the football team’s strength coach was for other operational reasons. “The Legislature designated such retaliation as a criminal offense,” the justices’ decision said. “Therefore, when CSU makes a finding of retaliation, to satisfactorily address the whistleblower complaint, its determination letter must state whether the matter was referred to criminal prosecution, and if not why not. Anything short of this defeats the protections created by the statute. Here, because of CSU’s silence on the issue of punishment and discipline, CSU did not satisfactorily address Ohton’s complaint.”

This is an interesting lawsuit for sports lawyers to follow, because it illustrates the difficulty faced by whistleblowers who go up against institutional mismanagement. While it is governed by the specific restrictions which California law places on whistleblower retaliation, there may be similarities with other state's laws.

Walter Dix is back!

The 2008 Olympic bronze medalist in the 100 and 200 has announced his indoor schedule.

Dix, who has been training twice a day and who is finally healthy after an injury plagued 2009 season, expects to make his 2010 indoor debut at the Milrose Games in New York City. He then plans to run at the Reebok Boston Games in Boston on February 6; the Tyson Invitational in Fayetteville, Arkansas on February 12-13; and the USA Indoor Championships in Boston on February 28. Dix is also expected to run in the Visa Championship Series.

Editor's Note: Walter Dix is a client of the sports law firm of Koch & Trushin, P.A. This is the first of an occasional series of blog posts regarding Dix's track exploits.

Here is an interesting perspective from a blogger who analyzed the Gilbert Arenas situation from a different angle. The blogger, Jordi Scrubbings, suggests that time is ripe for the National Rifle Association to take advantage of the situation and work with sports leagues and teams to educate them about gun ownership.

If possible, the NRA should teach courses not only to active players now, but also as part of the indoctrination seminars leagues have for new players – where players are warned about groupies, instructed on finances, taught how to talk to the media, etc. This would lay the groundwork for a change in behavior. If the players opt not to own a gun, that’s their choice. But for those that do chose to own and carry, at least they are instructed the right way.

While I will refrain from giving my political opinions about the NRA, I have to admit that the idea makes sense on some level. Rather than trying to ban pro athletes from owning weapons, why not teach them to use their weapons safely? As a sports agent, I would not advise my players on whether or not to carry weapons. I would, however, want them to use their guns safely if they chose to arm themselves.

GAINESVILLE, Fla. — On Jan. 29 sports agents, litigators, salary cap analyst and sports law students will huddle up at the University of Florida Levin College of Law to get ready for a whole new ball game.

In the next two years, time will expire on the Collective Bargaining Agreements affecting the negotiation of salaries and playing conditions for professional athletes. The 2010 UF Sports Law Symposium, “Discussion: Bargaining Collectively,” presented by UF’s Entertainment & Sports Law Society, will bring together sports law experts and representatives from the National Football League, National Basketball Association and Major League Baseball to discuss why CBA’s exist, how they help players and owners, and to identify contract terms that will likely be argued before the agreement expires. The free event, set to kick off at 11 a.m. at UF Law’s Chesterfield Smith Ceremonial Classroom 180, will offer CLE credits.

“The 2010 UF Sports Law Symposium will be an excellent forum for students, athletes, professors and others interested in sports law to network and learn from the brightest minds in sports law,” said Darren Heitner, president of UF Entertainment & Sports Law Society.

The keynote speaker for this year’s symposium will be Harvey W. Schiller, Ph.D., who has served as president of the International Baseball Federation since 2007 and is also chairman of the board and CEO of GlobalOptions Group, a multidisciplinary international risk management and business solutions company located in New York. Prior to joining GlobalOptions in 1994, Schiller held posts at Turner Broadcasting System, served as the executive director/secretary general of the United States Olympic Committee and was the commissioner of the Southeastern Conference.

Continue reading " UF Sports Law Symposium to Examine Legal Playbook as Collective Bargaining Agreements Expire " »

Is it possible that sports agents who try to procure sponsorships for their clients are over-thinking the process a little too much? Milwaukee Wave soccer player Marco Terminesi probably thinks so.

Terminesi obtained a sponsorship for himself the old fashioned way. He ate at a local restaurant. He liked it. He talked to the restaurant’s manager. He asked the manager if the restaurant would sponsor him. The manager agreed, and now the soccer player has a sponsor:

"It's perfect for me," Terminesi said. "It's healthy food, and the players go there. And Felipe likes soccer." Camargo, a soccer fan himself, said he's been happy with the response so far. In his mind, both the Wave and his restaurant are on the same agenda: a fun, family-friendly atmosphere. "They care about their fans," Camargo said of the Wave. "And we care about our customers."

Of course I am being a little tongue-in-cheek with this post, as we know it is not always this easy to procure a sports sponsorship. Also, most leagues and governing bodies are not as loose with their sponsorship regulations as Major Indoor Soccer League, which allows individual players to place their sponsor’s logos onto their uniforms. Can you imagine the NFL allowing uniforms to be adorned with individual sponsor logos?!

The sports agent sponsorship scam which recently came to light in England illustrates yet again why all athletes should consult their sports lawyer before handing over their hard earned money.

In the latest scam, a British sports marketing agency asked for money up front from athletes in exchange for the promise of procuring endorsements. Even Andrew Steele, one of the athletes who was ripped off, acknowledged that he thought being forced to pay upfront was a red flag:

“I asked: 'why does it have to be up front, why can't I give it once the sponsorship has been secured?' They said that if the money didn't materialise then I would get a refund, so I thought I'd go for it.

Steele said his fears were lessened because the agent employed several prominent former athletes. This seems to be a common practice among sports marketing agents who are operating scams. They pay athletes to recruit other athletes. Because pro athletes tend to stick together, they feel better when one of their own is on board.

The bottom line here is that any time a sports agent request money up front, the athlete should run quickly in the opposite direction. While there may be certain hourly and flat-fee arrangement for certain types of sports agency duties, this type scenario is rare, and should only be entered into cautiously and with someone trustworthy. When in doubt, the athlete should consult a sports lawyer.

Here is a public relations disaster in waiting. According to this report, the NCAA may soon be testing for sickle cell:

As part of a settlement the NCAA agreed to recommend that all universities and colleges offer athletes screening for the sickle cell trait. And Rice University will propose a bylaw at the association’s annual meeting to make that mandatory. Currently, 64 percent of colleges screen for the sickle cell trait.

This sounds like a ripe sports law action the first time an athlete is excluded from competition because of this testing, at least based on rudimentary data regarding the prevalence of the trait in African Americans over those of other races. While I will not pretend to be an expert on genetics, it seems that this potential regulation may be taking things a little too far. If anything, I think it would lead to an increase in certain types of waivers of liability. In other words, schools would probably not be able to ban athletes from competing, but if the student-athlete is identified as possessing the trait, he would have to acknowledge its existence, and hold the institution harmless.

There is also an argument about the “slippery slope” which says that once institutions start testing for one trait, what is to stop them from testing for dozens of other specific characteristics and “discriminating” on that basis? I do not envision that the sickle cell testing would lead to this slippery slope, but this is a sports law trend that is worth keeping an eye on.

When a judge in Athens-Clarke County dismissed the sports lawsuit brought by former Georgia Bulldog Decory Bryant, the matter was mostly decided on what laypersons might describe as a technicality.

The court ruled that the Georgia Athletic Association is an arm of the state and therefore entitled to protection under the sovereign immunity doctrine. At first glance, this seems like a reasonable ruling, right? Bryant sued his athletic department for failing to procure insurance, and the court ruled that the athletic department is a government entity, and therefore protected from certain types of lawsuits.

Further investigation reveals that it is not quite this simple. The GAA is a non-profit organization. This means that it is not a division of the University of Georgia in the way that, for example, the school’s physics department might be fully encompassed within the institution.

Universities generally form non-profits such as the GAA so that they can evade the usual restrictions faced by public institutions. For instance, in some states, government employees have their salaries restricted by statute. The way to get around that restriction for coaches is to make the coaches employed by the non-profit, and not the state institution.

This means that the GAA is trying to have it both ways. They want to be a separate entity from the University of Georgia with the protections of a private non-profit, but they also want sovereign immunity, which is only available to government entities. It sounds to me like Decory Bryant’s lawyers will be appealing to a higher authority.

If Gilbert Arenas had a sports agent, would his legal problems be viewed as less serious? Arenas allegedly got into it with Washington Wizards teammate Javaris Crittenton. This dispute is far more serious than the average teammate-on-teammate spat because Arenas is being investigated by police for apparently threatening Crittenton with a gun.

Mike Jones, a former Washington Times sports writer, writes in his blog that Arenas “doesn’t have an agent boldly proclaiming a positive outcome for him, partly because he has no agent.” This comes on the heels of Crittenton’s agent making this statement:

“I’m confident my client hasn’t done anything wrong,” Bartelstein said. “The fact will bear that out. It’s unfortunate that rumors get going and inaccuracies come out before the facts are known, but all we can do is wait for the investigation to conclude.… Javaris will be exonerated of any wrong doing.”

Bartelstein is doing the right thing by his client. It is his job to make such statements and to believe in his client. If Arenas had an agent, he would undoubtedly issue similar statements. Still, I have my doubts that the agent’s statements would be too helpful in the investigation by law enforcement.

For precedent, see the Plaxico Burress situation. His agent, Drew Rosenhaus, was optimistic in his predictions. Rosenhaus is as talented and aggressive a sports agent as anyone in the business, but even he could not keep his client out of prison. Sometimes the agent has to fulfill his obligation to speak positively and defend his client, even when he knows there are higher powers, such as the law, that will be the final arbiter of his client's future.

The sports media and sports business world was in a frenzy recently over the upcoming launch of TMZSports, a gossip site apparently to be devoted entirely to athletes rather than entertainers. TMZ is already an established media brand and is one of the world's most heavily trafficked web sites, and it earned $40 million in ad revenue over the past two years.

While pundits have weighed in on what this means for sports media, no one has yet discussed what this means for professional athletes and the people who help manage their careers such as sports agents and sports lawyers.

My take is that it while it seems scary - because TMZ habitually pays people for tantalizing photos - it is not something that should scare athletes. Any athlete with a brain already knows that even a minor transgression is in danger of being captured by a cell phone camera and posted online within seconds. The reason that athletes need not be worried is that as Shanoff writes in the first link that I posted above, the general public does not care about the private lives of its sports idols. There are, of course, obvious exceptions, such as the Tiger Woods story. The bottom line is that it’s one more thing for athletes and their agents to monitor, but athletes need not be worried because of a new gossip web site, even if the site is already branded as one of the world's most popular.

To think that the paparazzi will suddenly be parked outside of NFL practice facilities and following offensive linemen around town on their nights out is an over-exaggeration. The TMZ culture of celebrity worship is a phenomenon which has been ongoing for more than a century; entertainers have always been the target of obsession. Only the elite of the elite professional athletes, on the other hand, have been treated as celebrity objects. I predict TMZ's venture will be a non-factor within a year of its launch.

If you are a college football coach and you have a sports agent, you are undoubtedly hoping that college coaching salaries continue to escalate. Unfortunately for the coach and sports agent, I think too many factors are working to force salaries into a downward trend.

In major college sports, it turns out that the entire “game” is deemed a not-for-profit. A recently published report about the University of Texas explains how college sports are considered to be big business, but still remain tax free:

Over the years, the NCAA and other college sports supporters have convinced the Internal Revenue Service that athletics are a genuine part of the educational experience. Yet big college athletic programs also have become more business-minded as their costs have risen. On average, the Congressional Budget Office found that about two-thirds of the athletics revenue at large universities comes from activities such as sales of tickets, TV rights, advertising and merchandise that would be taxed if the schools were ordinary businesses.

The uproar has resulted as people have realized that college sports may be getting a free ride. While changes in this realm may not necessarily impact professional athletes right away, it could result in lesser salaries for coaches as college sports programs are forced to start paying more tax. As head coach salaries have escalated, I have always thought that the market was due for a correction at some point in the coming decade. This movement to potentially strip college sports programs of their non-profit status is yet another sign that coaching salaries will eventually come back down to earth.