UFC parent company paid Pride CEO $10 million to leave MMA

Documents unearthed in the anti-trust lawsuit against the UFC’s parent company, Zuffa LLC, have revealed that Pride CEO Nobuyuki Sakakibara was paid $10 million to leave the MMA business for seven years (via Jason Cruz on Twitter).

If you are interested in following Friday's #UFCHearings, check out @heynottheface and @MMAanalytics timeline. I'm sure you are already. Also, I'm compiling expert reports and other filings on my Scribd: https://t.co/jyBzH9KKOu

— Jason Cruz (@dilletaunt) August 30, 2019

Zuffa acquired its long-time rival, Pride Fighting Championships, on March 27, 2007. Part of the acquisition included a non-compete clause for the Japanese CEO, preventing him from operating in the MMA space for 7 years for $10 million. Once the contract expired, Sakakibara used his resources to create his current project, RIZIN Fighting Federation.

The antitrust lawsuit was filed by fighters Cung Le, Nate Quarry, Kyle Kingsbury, and Jon Fitch. They allege that anti-competitive conduct by the organization created a monopsony. The lawsuit alleges that the UFC operates a systematic monopsony that dominates the market, stifles competition and salaries for fighters.

The lawsuit alleges (via Fox Sports) that the UFC is “systematically eliminating competition from rival promoters, artificially suppressing fighters’ earnings from bouts and merchandising and marketing activities through restrictive contracting and other exclusionary practices.”

An attorney representing the case said, “All UFC fighters are paid a mere fraction of what they would make in a competitive market. Rather than earning paydays comparable to boxers, a sport with many natural parallels, MMA fighters go substantially under-compensated despite the punishing nature of their profession.”

The case was filed on December 16, 2014. In 2015, additional antitrust lawsuits were filed against the UFC. The purpose being to discover:

Does the UFC have monopoly power?

Did the UFC acquire or maintain such power through exclusionary conduct?

Did the UFC cause antitrust injury since having a monopoly is not always illegal in the United States?

The Pride non-complete clause gives some insight into the acquisition activity of Zuffa LLC and the effect this has on their alleged industry monopsony, which is being bought into question.

This article first appeared on BJPENN.COM on 9/1/2019.