Thursday, March 22, 2007

PRIDE, Fishman, and The Fertitta Brothers

According to the Clark County Court District web site, judge Timothy C Williams has been assigned to the Fishman Companies vs. DSE case .

There are a significant amount of questions already in play in regards to the court case itself. However, I came up with more after listening to the Sherdog radio interview with Ed Fishman that I think are really pertinent to ask.

When you discuss the sale of PRIDE (either its assets or DSE itself), realistically the only ‘assets’ of value are the fighter contracts. The VTR collection has little value in the US and the PRIDE name/logo isn’t substantial (it could be if UFC used its marketing power behind it, but that would be speculative to suggest). In fact, the PRIDE name/image has been damaged by the Shukan Gendai negative media campaign. Therefore, you obviously have to look at what kind of contracts PRIDE had with its fighters, particularly their top gaijin stars. Emelianenko Fedor and Wanderlei Silva are not believed to be under PRIDE contract right now. The much bigger issue is what kinds of contracts PRIDE signed with their fighters and what lawyer(s) they used to write them up.

One of the main attorneys dealing with foreign fighters that I believe could be called into question by The Fertitta Brothers (or Fishman Companies’ legal team as well) is Michael (Thomas) Connette, who has been representing Bob Sapp. Connette became publicly known during the scandal with Bob Sapp and K-1 for Simon Rutz in Holland last year. K-1 and K-1 friendly media outlets pointed the finger at Connette and basically labeled or indicated him to media consumers as a DSE lawyer. Excluding the K-1/Sapp scandal, I was told from a source in the Japanese fight scene that supposedly Connette could have had some sort of relationship with PRIDE Vice President Sotaro Shinoda (who is close to Nobuyuki Sakakibara) in regards to possibly preparing fighter contracts. Connette’s name also surfaced when PRIDE had legal trouble with Royce Gracie after Royce worked for K-1 against Akebono. Connette is still registered as a foreign lawyer in Japan, with his initial background being in California.

I mention Connette’s name because there could (in my opinion) be a chance that he wrote some of the PRIDE fighter contracts. If so, there are certainly legitimate and valid questions to ask about the amount of potential loopholes in the deals. Also, is Connette familiar with the ownership structure of DSE, therefore perhaps putting him in a position to be forced to testify in the Fishman Companies lawsuit in regards to his potential knowledge of such facts (subject to any legal privileges that may be invoked)?

What if the contracts are personal service contracts that are not assignable to third parties if PRIDE is sold? This would result in the fighter having a right to terminate the contract. If that is the case, the contracts likely are not transferrable by DSE and therefore have little to no value for a new buyer.
What if the contracts specifically state permission to take performance-enhancing drugs? This issue was brought up in a report by The Fight Network when Pawel Nastula failed his drug test after the first PRIDE US show on 10/21/06.
What if the contracts have no enforceable penalties against fighters for no-showing (PRIDE did try to take Royce to court in Los Angeles in the past, that should be duly noted)? In the Royce case, DSE was suing him for breaking an ‘exclusive contract’ to fight in K-1.
If you have contracts that aren’t worth the paper they are printed on, how much impact does this have on the value of the assets in a purchase by The Fertitta Brothers? And, could Connette be called to testify in the Fishman Companies lawsuit against DSE if he (Connette) had a hand in DSE activities?

If the Fertitta Brothers do in fact make a deal with Nobuyuki Sakakibara for just the assets of PRIDE, they would likely enter into a heads of agreement. It’s the equivalent of a handshake that’s not legally binding until lawyers perform due diligence (which could take 30 days or longer to perform). If the Fertitta’s lawyers turn up anything that doesn’t pass the sniff test, they could put a stop to the potential transaction.

If the Fertitta Brothers attempt to buy PRIDE’s assets, there’s certainly reason to believe that Fishman Companies could attempt to legally attach onto that sale payment through its lawsuit against DSE by arguing to judge Timothy C. Williams that DSE’s company has shady businessmen and/or cannot be trusted to pay the remedy if they lose in the Clark County district court lawsuit. If Fishman Companies attempts to make this argument, this is where you could see the yakuza scandal (Shukan Gendai’s negative campaign, Fuji TV cuts ties, etc.) come into play. At that point, if Fishman Companies or the courts (or even the Nevada Gaming Commission) gets involved and believes that there is shady activity involved with DSE, that could be a big legal issue.

Another interesting angle to consider in these stories is Nobuyuki Sakakibara’s recent visit to Brazil to visit both Chute Boxe and BTT (Brazilian Top Team). Is it possible that some Brazilian fighters happened to sign brand new contracts that are different than the traditional PRIDE contracts they signed in the past?

When I look at the whole story involving the potential sale of PRIDE, it eerily reminds me of what happened with World Championship Wrestling (WCW). When things were looking real bleak, former WCW boss Eric Bischoff tried to purchase WCW from Turner Broadcasting through Fusient Media Ventures. However, once Fusient found out that TBS wouldn’t guarantee airing WCW on its network, Fusient backed out of the deal. WWE ended up purchasing WCW’s assets, primarily its tape library. And the rest was history.


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