By Jake Donovan
For the second time in just over a month, an active lawsuit against adviser Al Haymon and his related companies has entered the discovery phase.
BoxingScene.com has learned that Golden Boy Promotions’ $300 million antitrust lawsuit was permitted to proceed, as ruled by the United States District Court, Central District of California, Western Division.
The ruling came following a Second Amended Complaint by Golden Boy as plaintiff on January 20, followed by Haymon Defendants’ Answer to Second Amended Complaint by Haymon’s legal team on February 3, according to documents obtained by BoxingScene.com.
News of Golden Boy being granted the right to seek answers in pursuit of previously undisclosed documents comes on the heels of a similar ruling landing in favor of Top Rank in January.
The two cases are separate, but there is common ground in each. Both claim that the formation of Haymon’s Premier Boxing Champions (PBC) series – which first launched last March – is an attempt by the adviser to monopolize boxing, as well as his alleged violation of the Ali Act, with both companies claiming that Haymon has acted as both manager and promoter to several of his clients among a stable that boasts an estimated 200 boxers.
Haymon has entered time-buy agreements with multiple networks - including free-to-air NBC, CBS and Fox – along with regional cable outlets ESPN, Spike, NBC Sports Network, Fox Sports 1 and Bounce TV. PBC is funded by a multi-million dollar financial war chest provided by Waddell and Reed – an asset management and financial planning company based in Kansas.
Both lawsuits previously named the company as a co-conspirator, as well as Ryan Caldwell, a former portfolio manager for the investment firm who handled the three key funds – The Ivy Asset Strategy Fund, Waddell & Reed Advisors Asset Strategy Fund and Ivy Funds VIP Asset Strategy – from which investments were made to bankroll the PBC model.
Top Rank’s initial lawsuit was rejected by the court on October 16, 2015, but with leave to amend. The ruling was made following Haymon’s legal team filing a Motion for Dismissal, receiving at least a partial victory in forcing Top Rank to restructure its lawsuit by no later than October 30, 2015.
The amended version was to not include Waddell and Reed or any of its group partners, to which Top Rank obliged. Haymon’s side filed a Second Motion for Dismissal, met by a Motion of Opposition by Top Rank’s lawyers and a Reply by Haymon Defendants one week later.
Golden Boy’s ongoing lawsuit – which was filed last May - did not feature as much back and forth, as Haymon’s Defendants never filed a Motion for Dismissal against its former business partner. However, Golden Boy opted to amend its original complaint in efforts to clean up a few items and also reflect current events since its initial filing which claimed Haymon “entered into agreements to restrain trade in a substantial portion of the market for promotion of Championship-Caliber Boxers.”
News of the original filing came months after an ugly divorce between Golden Boy and Haymon which at the time was believed to be the end of the implosion and restructuring of the California-based promotional company. Included in the series of events was the forced resignation of longtime Golden Boy CEO Richard Schaefer, who continues to enjoy a personal friendship with Haymon after years of doing business together.
Schaefer and de la Hoya had a major falling out in the first half of 2014 over the direction of the company. Upon his release from rehabilitation for substance abuse, de la Hoya sought to make amends with Bob Arum, his former promoter during his Hall of Fame career whose Top Rank became embroiled in what was known as boxing’s Cold War with Golden Boy. The move did not sit well with Schaefer, whose exit prompted sweeping in-house changes.
De la Hoya has since steered Golden Boy in the direction of willing to do business with all entities, a move that prompted his company’s full return to HBO after the company had ushered the majority of its stable across the street to Showtime.
At the time, the move – which began in 2012 and hit full force by spring 2013 - was necessitated upon HBO’s insistence of no longer wishing to do business with Haymon. It wasn’t until spring 2014 when de la Hoya learned that the majority of fighters he believed to be under Golden Boy’s banner were in fact promotional free agents bound only by advisory pact to Haymon.
From there began a downward spiral between parties. The dispute was thought to have ended with their reaching an undisclosed settlement from Haymon in exchange for the full release of his fighters, among a list of other agreements that remain in a sealed envelope.
Instead, Golden Boy took it up a notch – several in fact – with its bombshell news last May.
"During my 25 years in boxing, I have watched far too many fighters be chewed up, spit out and left with nothing to sit idly by while Mr. Haymon flaunts a federal law meant to protect those who put everything on the line to entertain fans of our sport," de la Hoya said at the time. "The Muhammad Ali Act was passed to help fighters avoid the fate that bedeviled so many of our predecessors; and I will do everything in my power to ensure this crucial piece of legislation is upheld and followed."
In its original lawsuit as well as its amended complaints, Golden Boy also included Waddell & Reed as well as Caldwell as co-conspirators. Whereas Top Rank was obligated to release both entities from its own amended complaint, Golden Boy’s legal team has since voluntarily agreed to do the same, filing a Notice of Dismissal to drop Caldwell from the suit, pursuant to Federal Rule of Civil Procedure 41 (a) or (c):
F.R.Civ.P. 41(a): This notice may be filed at any time before service by the adverse party of an answer or of a motion for summary judgment, whichever first occurs.
F.R.Civ.P. 41(c): Counterclaims, cross-claims & third-party claims may be dismissed before service of a responsive pleading or prior to the beginning of trial.
The heart of Golden Boy’s original lawsuit remains intact. Its case is based on five separate claims against all Defendants:
- Attempted Monopolization in Violation of 15 U.S.C. § 2;
- Unlawful “Tie Out” in Violation of 15 U.S.C. § 1;
- Injunctive Relief Under 15 U.S.C. § 26;
- Violation of the California Unfair Practices Act; and
- Unfair Competition
In categorically denying all allegations, Haymon Defendants summarily responded to the affirmative defenses and allege as follows:
- The Attempted Monopolization complaint fails to state any claims for relief;
- All or part of Golden Boy’s claims are barred by a release;
- All of part of Golden Boy’s claims are barred by their own unclean hands and inequitable conduct;
- Golden Boy’s antitrust claims are barred due to legitimate and procompetitive business justifications Haymon Defendants’ conduct; and
- All or part of Golden Boy’s claims are barred to the extent they are predicated on alleged violations of the Ali Act, because that statute does not provide for a provide right of action by boxing promoters.
Rather than filing for a Motion for Dismissal as they did with Top Rank, Haymon Defendants instead issued an Answer to The Second Amended Complaint on February 3. In doing so, Haymon categorically denied any such claims and allegations requiring a response.
An interesting dynamic in this ongoing legal battle is the fact that Golden Boy has entered business agreements for two fights involving boxers advised by Haymon.
The company’s biggest current star, Saul ‘Canelo’ Alvarez will defend his World middleweight championship on May 7 versus Amir Khan, who was one of a handful of fighters both promoted by Golden Boy and advised by Haymon.
Khan went with Haymon and PBC upon the split, but has just fought once under the latter – a 12-round win over Chris Algieri last May. The rest of his time has been spent pursuing dream fights with Floyd Mayweather and former training stable mate Manny Pacquiao.
News of his agreeing to face Alvarez was kept well under wraps. Golden Boy surprised many in the industry, most of whom either chose to or were led to believe that the fight was done without the involvement of Haymon. Golden Boy was on record in stating that all negotiations were conducted directly with Khan and his immediate team, including his father Shah and attorney Robert Davis.
"I did not talk to or deal with [Haymon] for one second," de la Hoya told ESPN’s Dan Rafael. "But I am willing to work with any promoter, including Al Haymon.”
While de la Hoya’s claim fit the agenda of those who don’t share a favorable viewpoint as it relates to PBC, it was Khan himself who set the record straight. The former 140 lb. champ and current Top 10 welterweight contender took to social media in verifying that he kept Haymon abreast of talks every step of the way, including his being given full blessing by his adviser to pursue to the fight.
From a legal standpoint, it remains to be seen how this development affects the current standing lawsuit if at all. The same can be said for an ordered lightweight title fight that is presently in “postponed” status, as Jorge Linares was placed on the injured list in pulling out of a planned springtime title defense versus unbeaten mandatory challenger Dejan Zlaticanin.
The bout was due to air on Showtime, with Lou DiBella – who promotes the Haymon-advised Zlaticanin – seeking a proper date and venue for the bout. Those plans were scuttled when Linares – who is co-promoted by Golden Boy Promotions and Teiken Promotions – informed local media in Venezuela of a fractured right hand that will keep him out of the ring for the next two months or so.
Golden Boy insists the fight will happen once Linares is fully healed and ready to return to the ring, as the only alternative would be to vacate the title. Should the fight proceed as planned, it will conclude a development that began with both parties agreeing to terms without the fight being subject to a purse bid hearing.
Furthermore, said agreement meant Golden Boy allowing its fighter to appear on Showtime, in light of its preferred network partner HBO showing lukewarm interest in the bout.
Another Haymon-related venture on HBO not including Golden Boy comes in the form of an April 23 middleweight title fight between defending champion Gennady Golovkin and mandatory challenger Dominic Wade.
Golovkin is promoted by K2 Promotions, whose managing director Tom Loeffler negotiated directly with TGB Promotions’ Tom Brown, who promotes the Haymon-advised Wade.
Meanwhile, the lawsuit continues. A court date hasn’t yet been set, but the discovery phase is now fully underway.
Should the matter go to trial, Golden Boy seeks the following in its Prayer For Relief:
- A permanent injunction precluding Haymon Defendants from having any direct or indirect financial interest in the promotion of bouts featuring boxers they manage, from acting as both boxing managers and boxing promoters;
- Damages in the sum of $100 million or such other sum as shall be found;
- That such damages be trebled pursuant to 15 U.S.C. § 15;
- For restitution in such amount as shall be found;
- For interest at the highest lawful rate; rate on all monetary awards;
- For plaintiffs’ reasonable attorneys’ fees; and
- For costs of suit and such other or further relief as the Court shall deem just.
It remains to be seen how all of this eventually plays out. For now, the two leading promoters in set out to disrupt what they believe to be unlawful business practices have been granted their wish for discovery in pursuit of answers to their many questions.
Jake Donovan is the managing editor of BoxingScene.com. Twitter: @JakeNDaBox
