One of the largest developments in the combat sports world occurred just last Tuesday. The news broke that Judge Richard Boulware, the judge presiding over the UFC's antitrust had denied the UFC's proposed $335 million dollar settlement. The UFC had offered a settlement which was initially accepted by the plaintiffs on March 24, 2024. Due to the judges list of concerns regarding the settlement, the court decided to reject it. A status conference has been scheduled for August 19th and the trial is set to commence on October 28, 2024. But how did we get to this point? And what are the implications behind these developments?
Background
For several years prior to the lawsuit, the Ultimate Fighting Championship had routinely purchased other major mixed martial arts promotions and absorbed their talent. They have also been accused of utilizing predatory contracts to limit athlete opportunities and pay. Former matchmaker, Joe Silva would at times attempt to get fighters to sign for less money, giving them extremely difficult fights on the prelims to ruin their credibility should they choose to pursue different options. In a now infamous text-exchange between UFC CEO, Dana White, and then UFC owner, Lorenzo Fertitta, they discussed options that they had taken away from two fighters (Gilbert Melendez and Eddie Alvarez). The messages later revealed by the court would not paint a very good picture for the UFC and its defense.
Dana White would state in a text message, "Bro, you know I love you to f****** death as it is, but what you pulled off this week with Melendez and “other dude” (Eddie Alvarez) is f****** BAD ASS! F****** cut throat nasty business like u see in movies! Good s*** homie, CONGRATS!". Fertitta responded, "We gotta keep taking these f***ers oxygen till they tap out. We have sacrificed too much to let anyone get traction now!” Dana White would continue to express his admiration and agreed that these policies should be pursued further. These types of actions and behaviors contributed to legal action.
In 2014, a group of athletes launched the anti-trust lawsuit against the UFC's then parent company, Zuffa LLC. This collection of former UFC alumni contained many well-known names, such as Nate Quarry, Cung Lee, Jon Fitch, Brandon Vera, Kyle Kingsbury and Luis Javier Vazquez. Their case stated that the UFC was utilizing unfair contracts and anti-competitive business practices to monopolize the sport, along with suffocating their competition. The UFC was also accused of monopsony and suppressing the wages of athletes, paying them well under what they believed they were entitled to. The was a slew of five class-action lawsuits that were launched against the UFC between December 2014 to March 2015, until they were all combined into a single extensive lawsuit in June 2015.
Lee Case
The plaintiffs had initially been seeking restitution for damages amounting up to $1.6 billion. But once the lawsuit was granted class-action status on The lawsuit was extended to encompass the 1,214 fighters who competed in the promotion from 2010-2017, and will include all those who wish to participate. The UFC claims because their fighters are "independent contractors", the organization is not required to offer long-term health insurance, they also went on to claim that the plaintiffs represented only themselves and did not represent UFC athletes as a whole. In 2015 the UFC tried to have a case dismissed, but this was denied by the courts almost immediately. Following this, the UFC requested "summary judgment", meaning the organization believed that the case had no merit and should be immediately dismissed or ruled in their favor. This was also later denied. UFC contracts were later described by a presiding court official as "coercive" and "ruthless". Also noting that there was significant evidence that the UFC had been involved in suppressing athlete compensation and "anti-competitive conduct".
Johnson Case
On June 23, 2021, the plaintiffs were joined by TUF veterans, Kajan Johnson and C.B. Dollaway. They filed a further proposed class-action antitrust lawsuit against Zuffa LLC and Endeavor, which had purchased the UFC in 2016. This lawsuit contained similar allegations of the UFC's engagement in illegal anti-competitive action with modern athletes as well. Unlike the Lee Case, the Johnson Case covers all athletes that have competed in the UFC from 2017 until present, this includes currently active fighters. They are seeking better opportunities, changes to athlete contracts and fair compensation.
Current developments
The trial was initially set to take place in April 2024. However on the eve of the court date, the UFC offered the plaintiffs a $335 million settlement to be paid in installations. These terms were accepted by the fighters to the ire and frustration of the MMA community. On Tuesday, July 30, 2024. The UFC's proposed settlement was struck down by US District Court judge, Richard Franklin Boulware Jr. After giving a brief summary, it was announced that the trial would recommence in October. Dana White reacted to the situation by claiming that this lawsuit was in his words, "beginning to feel personal" as Judge Boulware was actually a former schoolmate of Dana White and Lorenzo Fertitta. Judge Richard Boulware has been overseeing the Lee case antitrust suit for the last nine years, since it first began in 2015. Regardless, the courts do seem determined to see the UFC go to trial or offer sufficient terms. Due to the fact that this lawsuit gained class-action status the court must preside over any settlement sought by the two parties to ensure fairness. The courts stated that there were several reasons for denying the settlement, but noted that the reasons for their choice would be further expanded upon as the case moves forward.
Possibilities
Loss
If the UFC loses the upcoming case, they could be required to pay the opposition almost $5 billion in restitutions, which is over 40% of the organization's total net worth (value sits at $11.3 billion independently of TKO). It is likely that Johnson Case will not see the courtroom for 5 to 10 years, but settlement or a loss in that case could mean further financial unease for the company. They could also be restricted by court order from operating any predatory contracts for up to 5 years, this would allow their fighters to freely choose to move between organizations that offered better financial incentives. Similarly to boxing, these events could also see the Ali Act expanded to encompass mixed martial arts, or a separate body may be created that would oversee the rights of fighters. If this were to occur, these events would certainly affect the MMA community greatly. The restrictions or punishments handed out to the UFC could force a power vacuum in the industry which would open the way for others to truly challenge them. Either way let's just say ticket prices are going to be very expensive over the next little bit.
Settlement
Despite being denied, the UFC continues to seek and is absolutely allowed to renegotiate their settlement. The settlement was denied as the court believed the amount of money was insufficient in regards to the size of the case and the amount of individuals involved. They also noted the extremely limited improvement of contracts for active athletes. Most of the settlement was to go towards the plaintiffs of the Lee Case, leaving very little for modern athletes represented by the Johnson Case. If the UFC can improve the amount of money that they are willing to offer and provide additional incentives with the improvement of contracts - then negotiations may proceed again unimpeded. If settled out of court the UFC would avoid any legal ramifications for past actions while allowing them to maintain their spot as the planet's number one mixed martial arts promotion.
Victory
Though certain victory seems increasingly less possible for the UFC, there is a possibility that case could be thrown out if a member of the jury does not agree with the plaintiffs. Further affecting the UFC's chances to claim a guaranteed win is the list of witnesses that have been precluded from testifying on their behalf. This included fighters, Michael Bisping, Chael Sonnen, Michael Chandler, Donald Cerrone, Miesha Tate. The list also included five coaches or managers, Jason House, Josh Jones, Dan Lambert, Ali Abdelaziz, Ed Soares and three UFC employees, Mick Maynard, Craig Borsari and Marc Ratner. Still if the UFC finds itself winning the case it could see the fighters walk away with absolutely nothing.
One thing is for certain, these coming months will be high stakes for the promotion and the plaintiffs alike. And perhaps it is us, the community and the fanbase who stand to gain the most from certain outcomes. The UFC has shown itself capable of surpassing insurmountable odds, but can they achieve victory when it is the very building blocks of their empire itself that challenge them.
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