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http://www.telegraph.co.uk/htmlConte.../sobox212.html
Mystery of Don King and the shrinking $1m purse
By Owen Slot
ON Saturday night in the Manchester Nynex Arena, Naseem Hamed will defend his WBO featherweight title against the Puerto Rican Wilfredo Vazquez and a large purse awaits both fighters. For Hamed, the purse is over £1 million which means that £1m-plus will be his thereafter. It may seem odd to explain this but money, in boxing, has a habit of allegedly arriving at the wrong destination.
Fourteen months ago, Hamed fought Tommy 'Boom Boom' Johnson at the London Arena. For Johnson, a 33-year-old champion, the defeat would be his last big pay-day after a valiant career at the top. Johnson might now be retired in his native Detroit, sitting on a nest-egg of $1 million from that fight. Instead he is fighting on. The $1m he claims he was due became just $250,000.
The Sunday Telegraph has evidence of what can happen to a purse when you are a boxer. And the easiest way to lose it, it seems, is to fight for Don King, the American promoter. Even Frank Warren, who has seen the sport doing its business for over a decade and who co-promoted the London Arena bill with King, is staggered by the size of the hole that King burned in Johnson's pocket.
"King delivered Tommy Johnson to us. We paid $1m for Tommy Johnson, Johnson walks away with $200,000 and $800,000 goes elsewhere," said Warren. "We know for a fact that $350,000 went to King and $130,000 went to his son. So they got half the purse."
While King carries a reputation for being Machiavellian, Johnson's experience comes packaged with a point-by-point diagnosis of what happened to the money. Johnson has provided a signed statement breaking down the process by which he ended up with a quarter in pocket of what he said he had been promised. This, then, is the story of Don King in operation.
Johnson, a featherweight from Detroit, had been the IBF world champion for four years until February last year when he stepped into the ring with Hamed, the WBO champion. Johnson versus Hamed had been the big showdown at that level and efforts to bring the two together had begun in earnest the previous summer.
King, Johnson claims, initially offered him $250,000 to fight Hamed, an offer which Johnson rejected as insufficient. Johnson had further problems with a possible deal when he was informed by King that he would have to sign an agreement with Monarch Sports, a management company, if the fight was to go ahead.
Johnson saw no reason to sign with Monarch because he managed his own affairs with the aid of Duke Durden, his advisor. He was also wary of the arrangement. In America it is illegal for any person or entity to manage and promote a boxer because of the perceived conflict of interests. Monarch Sports is a company owned by King's daughter Debbie and his stepson Carl.
Eventually Johnson signed with Monarch Sports. "I only signed," claims Johnson in his statement, "because Debbie King made it clear that otherwise I would not get to fight Naseem Hamed."
The expected purse for Johnson was $1m. Warren, the British half of the promotion, paid King for Johnson's services. "King categorically told me that Johnson would get $1m," says Warren.
Johnson, instead, says he received a contract for $650,000 plus $25,000 training expenses. "I refused to sign and I spoke to Debbie King," declares Johnson. "She told me to sign it and fax it back to DKP [Don King Productions] and that on receipt DKP would send me a second contract for $350,000. Despite the many requests of Debbie King, I never received the second contract. I considered pulling out of the Naseem Hamed fight but in the end I decided to go ahead and try to resolve it with DKP after the fight."
Johnson was never to receive the extra money, and in fact he would finish with far less. The statement he received from DKP accounted for most of the $650,000: the standard sanction fees to the WBO and IBF had been deducted ($19,500 and $16,250 respectively) and though Johnson's support team were paid out of the purse, there was also a payment to Monarch Sports of $130,000. It is standard for sanction fees to be deducted from the purse, but little else. It is not the promoter's duty to deduct tax, but DKP had withheld $98,037.50 for tax and there was also an unexplained deduction of $75,000. Johnson was left with $200,000.
"At the time I didn't know," said Johnson last week. "A lot of things were only brought to my attention a year later. It was only when the two promoters suddenly got a disliking for each other that a lot of things were exposed. I didn't realise."
The break-up of King and Warren is now being fought over in the High Court. As the bones of the broken partnership were picked over, it transpired that the money DKP had withheld for tax had been unpaid. Boxers fighting in Britain are obliged to pay a Foreign Entertainers' Unit tax and it was only in the recent fall-out with Warren that King paid the FEU tax. On March 5, the tax was paid: a figure of $49,000, way short of that which DKP had been holding on to. The balance was subsequently paid to Johnson.
King was asked last week about Johnson's allegations but refused to comment. This may be because he is busy organising the defence of a criminal trial for wire fraud which begins against him in New York tomorrow. It may also be because a pattern appears to have developed in his dealings with boxers. Johnson, it seems, is only the latest in a line of fighters that includes Muhammad Ali, Tim Witherspoon and, allegedly, Mike Tyson.
It was only last month that Tyson filed a lawsuit against King for $100m, a suit that is now a matter of public record in the US federal court in Manhattan. It claims that King both managed and promoted Tyson, that he gave Tyson the appearance that he had independent advisors, yet John Horne and Roy Holloway - who were supposed to be Tyson's managers - each received $4.3m from DKP as well as 10 per cent each from Tyson's purses.
In this way, the suit claims, King and DKP wrongfully took from Tyson $45m in purse money between 1995 and 1997. An example of how completely King controlled Tyson was given by Tyson's "independent" bookkeeper when asked to transfer Tyson's files to his new accountant: "I can't because the files are in cabinets owned by Don King."
King has long exercised impressive control over his fighters. As far back as 1980, in the aftermath of Ali's defeat by Larry Holmes, he took $950,000 off Ali, a matter recalled by Ali's former lawyer Michael Phenner in Thomas Hauser's acclaimed biography, Muhammad Ali. King, who owed Ali an outstanding $1m from the fight, visited him and put $50,000 in cash in front of him.
"Fifty thousand in cash looks like a lot of money," said Phenner, "so Ali had taken it and signed a release. When I heard that, a tear rolled down my cheek. Here we were, trying to get Ali set financially. He'd just taken a horrible beating, in large part for the money. And then he'd gone and signed a piece of paper that cost him $950,000."
So where does it all end? More than 100 lawsuits have been filed against King since 1978 and there are at least five unsettled at present. Tim Witherspoon, a former world heavyweight champion, is the exception in that he succeeded in taking more than $1m off King in an out-of-court settlement.
Witherspoon's case was a mirror image of Johnson's, just a decade earlier and far worse. For a fight against Frank Bruno in 1986, Witherspoon received $90,094.77 out of a supposed contract of $1.7m. Before he and King settled the case, Witherspoon had been broke, unable even to pay his rent. It is fair to say, then, that he probably deserved the extra million, though a considerable percentage would undoubtedly have gone on legal fees. This may be what drew Witherspoon, a decade past his pomp, back last week into the ring where he was defeated by an unknown.
You cannot, then, go far in boxing without finding an enemy wishing King's downfall. "I believe that he has lost the inner soul," said Bill Cayton who is a former manager of Tyson and has a lawsuit pending against King. "He has a big edge over all normal humans because he has no conscience."
"It's a shame with Don King," said Warren. "He does some silly things. The other side of the guy is that he is one of the hardest working people I've ever met, the man's so intelligent, with tremendous vision. But he can't help himself."
It may just be that he has hurt himself too much already. The insurance fraud case which starts in New York tomorrow is prosecuting him for the (comparatively) small sum of $350,000. The maximum penalty is a highly unlikely 45 years in prison. More realistic is the possibility that, as a convicted felon, he may lose his promoter's licence.
This is the second time the case has been tried. The prosecution case is that King claimed for $350,000 worth of training fees that were never paid for a fight that was never fought. Julio Cesar Chavez, the boxer who is supposed to have received the money, is testifying for the prosecution.
The first trial, three years ago, was dismissed after King admitted that the claim was wrong but pleaded ignorance, blaming the error on his company, DKP. This time round, DKP is on trial too.
Those who have observed King and his involvement in the legal process, however, believe that it will take far more than one court decision even to begin to eradicate him from the fight game.
One could even believe that King relishes the courtroom fight. Asked by one journalist if all the litigation worried him, he laughed and replied: "Listen. Investigation's my middle name, baby."Comment
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A lot of people i think, think all boxers are rich. Really unless your an HBO/Showtime WCB main event or PPV Main Event/Co main event you wont be getting much
Kermit Cintron got 30k i believe vs Walter Matthsyse.
I heard Herman Ngoudjo got 90k vs JLC, but only kept around 40k of that.Comment
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great thread, the sad reality is the crooks in boxingComment
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Manager vs. Promoter
What is the difference between a Manager and a Promoter?Comment
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