The judge overseeing the UFC antitrust lawsuit — a case that first launched back in 2014 — has denied the preliminary approval for a settlement and reset a tentative date for trial on Oct. 28.
On Tuesday, Judge Richard Boulware denied the planned settlement after the UFC agreed to pay out $335 million to close out two separate antitrust lawsuits filed by fighters. A separate written order detailing Boulware’s decision is set to be issued in the coming days but for now the antitrust lawsuit is moving ahead to trial with a status conference next scheduled on Aug. 19, which is where the exact trial date would be determined.
The judge previously stated in court that he objected to the settlement because the agreed upon payout seemed low and that the fighters represented in the second lawsuit — covering athletes from 2017 to the present — could object to arbitration and class action waiver clauses in existing contracts.
It’s a staggering decision handed down by the court after attorneys for the fighters argued that the agreed upon settlement would provide immediate financial relief for many athletes who desperately needed the money. The attorneys also admitted in court that sending this case to trial could result in a loss, which means the fighters involved in the case would receive nothing at all.
“The reality is the claim has little value,” Eric Cramer, an attorney for the fighters told the judge during a hearing about the proposed settlement. “They should take - they’d be better off both taking the money, getting the injunctive relief.
“The world where that doesn’t happen is not in that fighter’s interests because I would tell that fighter if they were in my office, ‘You’re likely to lose. You’re likely to get nothing.’”
In order to win at trial, the plaintiffs aka the fighters have to prove their case beyond a reasonable doubt and secure a unanimous jury verdict. Even if that happens, the UFC would undoubtedly file an appeal that could tie up the case for years before any payment would ever be made to the fighters.
If the UFC lost and all appeals were denied, the promotion could have been forced to pay out billions but even the attorneys for the fighters didn’t want to risk going to trial and potentially losing.
“There are thousands of people out there who could really use that money … and if this settlement doesn’t happen and we are forced to take this case to trial, we will, and lose, that would be devastating for a lot of people,” Cramer told the judge during the hearing in July. “And a lot of money would come out of the pockets of a lot of people.”
The antitrust lawsuit combined two separate cases with fighters represented from 2010 to 2017, which was initially filed by athletes such as Cung Le, Nate Quarry and others and then a second lawsuit that covered fighters from 2017 to the present, which was led by fighters such as Kajan Johnson.
The initial antitrust lawsuit filed back in 2014 argued that the UFC engaged “in a scheme to acquire and maintain monopsony power in the market for elite professional MMA fighter services.” The fighters claimed UFC achieved that goal through three key elements: exclusive contracts, coercion, and acquisitions that eliminated potential competitors.
After reaching a settlement agreement back in March, both the owners at the UFC and the attorneys representing the fighters celebrated the agreed upon payment with some athletes set to receive more than $1 million and around 500 more getting at least $100,000.
TKO Group Holdings — the parent company to the UFC — also seemed more than happy with the settlement with funds to pay out the $335 million already earmarked in a financial disclosure filed with the Securities and Exchange Commission.
“We’re pleased to have this matter resolved without introducing any further changes to UFC’s existing business operations,” TKO chief financial officer Andrew Schleimer said during a financial call back in May. “The long-form settlement agreement is expected to be filed shortly with the court for approval.”
With the judge denying the preliminary settlement agreement and putting the case back on the court docket with a new trial date, the UFC and the fighters could go back to the negotiating table to try and reach a new settlement agreement.
The UFC could also potentially seek to settle both cases separately, but it remains to be seen if that happens or not. Even if a new settlement agreement is reached, the court still needs to sign off to actually close out the lawsuits.
