UFC ANTITRUST CLASS ACTION LAWSUIT CO-LED BY BERGER MONTAGUE CERTIFIED BY THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEVADA WITH LIKELY TRIAL IN MARCH OR APRIL 2024

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Aug 22, 2023, 19:39 ET

The Class Action Alleges the UFC Conducted an Illegal Scheme to Eliminate Competition and Ultimately Suppress UFC Fighter Compensation

PHILADELPHIA, Aug. 22, 2023 /PRNewswire/ -- On August 21, 2023, the United States District Court for the District of Nevada indicated that it would put the antitrust class action, Cung Le, et al. v. Zuffa, LLC, d/b/a Ultimate Fighting Championship and UFC, on a "fast track," and likely hold a trial in March or April 2024. This announcement followed quickly on the heels of an order published on August 9, 2023 certifying a class of more than 1200 UFC fighters. The case was filed by Berger Montague and other firms on behalf of UFC fighters against Zuffa, LLC, which does business under the trade name "UFC."

The lawsuit alleges that the UFC conducted an illegal scheme in violation of Section 2 of the Sherman Antitrust Act that eliminated competition in the sport of Mixed Martial Arts (MMA) and suppressed compensation for UFC Fighters. Specifically, the complaint alleges that Zuffa used long-term, exclusive contracts to retain fighters within the UFC, used its market power to render its contracts effectively perpetual, and acquired or drove out rival promoters. Plaintiffs provided evidence at class certification that this market dominance allowed Zuffa to pay UFC fighters less than half the amount they would have received in a competitive market.

In his Class Certification Opinion, United States District Judge Richard F. Boulware, II said, "Ultimately, the Court finds, for the purposes of class certification, that Plaintiffs have set forth sufficient evidence that this Scheme amounted to a violation of the antitrust law." In particular, the Court made numerous factual findings for purposes of class certification, including:

"[T]here is myriad record evidence that market participants and observers viewed and treated Zuffa as the dominant power in the industry and changed their behavior as a result… This market dominance appears to have been part of what motivated WME-IMG to purchase Zuffa."
"[I]n addition to allegedly harming the fighters by suppressing wages, [Zuffa's] coercive contracts [with fighters] damage the overall market environment by artificially restricting competitors' access to strong fighter talent which could be used to grow their business… [C]ompetitors' inability to effectively compete with Zuffa in the market for talent has a direct and enhancing effect on Zuffa's ability to artificially, and improperly, limit fighter compensation."
"[T]he combined effect of the [fighters' Promotional and Ancillary Rights] contracts' restrictive clauses created a situation where Zuffa had the sole power to control a fighter's ability to make money for the majority of the average fighter's career. Through these restrictive contracts, Zuffa controlled how much, where, and when fighters could earn compensation by participating in a bout."
"Plaintiffs have also established that Defendants used a variety of ruthless coercive techniques to prevent fighters from becoming free agents—rendering these contracts effectively perpetual."
"These coercive tactics in conjunction with the restrictive provisions of the contracts themselves had a devastating effect on fighters' ability to control their careers and compensation."
Zuffa "evinced a clear intent to acquire and maintain monopsony power. Defendant has not presented sufficient evidence that these exclusionary contracts and coercive tactics were procompetitive or contributed to the overall development of the sport…. The evidence indicates the opposite: these tactics harmed competition and the development of the sport."

The certified "bout" class covers fighters who competed under Zuffa events that took place or were broadcast in North America from December 16, 2010 to June 30, 2017. They are represented by named plaintiffs Cung Le, Jon Fitch, Kyle Kingsbury, Javier Vasquez, and Brandon Vera. The plaintiffs are asking for damages of $811 million to $1.6 billion.

The Plaintiffs are represented by firms including Berger Montague, a nationally renowned complex litigation law firm. "We are gratified that the court has certified the class of UFC fighters we represent in such a comprehensive, careful, and detailed opinion," said Berger Montague Chairman Eric Cramer, who has led the case from the outset. "We look forward to prosecuting our case before a Las Vegas jury in the near future. Our case challenges the UFC's alleged abuses of market power to suppress athlete pay. We allege that because of its monopoly and monopsony abuses, the UFC pays its fighters only 20% of its event revenues, when boxing and other major sports pay well above 50%. The men and women of the UFC who put their lives on the line for their sport deserve better, and we intend to achieve economic justice on their behalf."

"It's important that class members know that they do not need to take any action at this time to recover money if we win at trial or obtain a settlement," added Josh Davis, a shareholder at Berger Montague and head of its San Francisco Office. "That said, we encourage class members to provide us with their contact information so that we can give them updates. They can do so by visiting https://www.ufcclassaction.com/."

Berger Montague PC is one of the nation's most experienced and successful complex litigation firms, having pioneered the antitrust class action. The firm has recovered more than $40 billion in verdicts and settlements for class members over 53 years and achieved one of the largest antitrust class action settlements in U.S. history—nearly $6 billion. Berger Montague is headquartered in Philadelphia and has offices in Chicago, Minneapolis, San Diego, San Francisco, Toronto, Wilmington, DE, and Washington, D.C.

Contacts:

Melania Stepanenko
[email protected]

Caroline Cornell
[email protected]

SOURCE Berger Montague