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United We Stand

Written by Tom Ngo
November 10th, 2008

MMA agents have banned together to block Showtime’s attempt to sell off their clients’, and former ProElite fighters’, contracts at a public auction on November 17th. The fighters’ representatives are challenging the legality of being able to transfer a fighters’ contract, as they were agreed to and signed based upon exclusive entities offered only by ProElite. The agents claim that those specific entities are not transferable, and fighters should be allowed to renegotiate brand new contracts with their next employers.

In the press release provided by the MMA agents, most notably Ken Pavia, Monte Cox, Ed Soares and Cesar Gracie, it states that their clients intend to fight the purchasers of any of their fighters’ contracts in court.

“We as sports agents battle against each other every day for the best opportunities for our clients. Ultimately we realize the struggle is always about the client’s best interest,” the statement read. “That is why we as the elite agents in MMA today have band together to address what we perceive to be a grave injustice…Absent significant pre-established negotiated terms, do not bid on these contracts unless you are prepared to fight the challenge to their legality.“

Last week, Showtime announced that they had filed papers with the Securities and Exchange Commission to inform them of their intentions to put ProElite’s remaining “tangible and intangible” assets up for public auction. These assets would include the contracts to all of the fighters under contract with the promotion.

The defunct company currently owes Showtime approximately $4 Million in loans, and the premium cable network states that ProElite has failed to repay it in a timely fashion. That, coupled with ProElite’s announcement a month ago that they were canceling their November 8th event due to lack of funding, and their impending bankruptcy filing just days away, Showtime is scrambling to recoup any amount of the loan that they can.

Complete Press Release of Agents Attempt to Block Showtime’s Auction of Fighter Contract:

We as sports agents battle against each other every day for the best opportunities for our clients. Ultimately we realize the struggle is always about the client’s best interest. That is why we as the elite agents in MMA today have [banded] together to address what we perceive to be a grave injustice.

On November 5th in an SEC filing and in related advertisements, Showtime Networks Inc. announced its intention to liquidate “Collateral” as defined by the assets of Pro Elite and their related entities at auction scheduled for November 17th. Included in these assets are certain fighter contracts. These fighters are our clients.

Individually we consummated promotional agreements with Pro Elite. These agreements were made based on a multiplicity of factors including but not limited to relationships with certain Pro Elite personnel, venues, television exposure, jurisdictional concerns, public relations support, and numerous other intangibles. These considerations are not readily transferable.

Whether or not these contracts are legally transferable is a matter of law. What is not at issue however is Showtime’s disclaimer that the assets are being sold “as-is, where-is basis, without recourse, warranty or guarantee of any kind.” We intend to fight the lawful ability to transfer these assets, and as we believe these are personal services contracts. We do not believe there is an obligation to perform if transferred. With pooled resources we are prepared to fight this issue.

The unity of this effort is unprecedented and the message that is being sent is clear. Absent significant pre-established negotiated terms, do not bid on these contracts unless you are prepared to fight the challenge to their legality. It is our intention to honor our commitment to Pro Elite, but if Pro Elite is not able to perform in accordance with the contractual terms, the fighters should be granted unrestricted free agency with the unfettered ability to enter the marketplace.

Ken Pavia
Monte Cox
Ed Soares
Matt Stansell
Bob Cook
Chas Bowling
Cesar Gracie

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