twitter google

A pessimist’s look at the UFC’s merchandise agreement

Josh Gross had a long and boring article talking about the ups and downs of the new UFC merchandising agreement and what it meant to fighters. But it was fucking dry as a refreshing mouthful of sand, and was much too balanced for my liking. Fortunately, here’s another take on the contract which makes it sound like a fighter might as well file for bankruptcy immediately after agreeing to the deal:

·       In exchange for granting Zuffa the Merchandise Rights, a fighter is entitled to (i) ten percent (10%) of gross revenue for sales of Licensed Merchandise completed by Zuffa, and (ii) twenty percent (20%) of gross revenue for royalties and/or license payments received from third parties.

·       The Agreement grants Zuffa an exclusive license prohibiting even the sale of autographed photographs!

·       The Agreement operates to strip even the fighter himself of the opportunity to profit on his own Identity in the marketplace.   Not only are fighters being asked to sign an agreement that grants likeness rights to Zuffa on a worldwide, exclusive basis (to the exclusion, incredibly, of even the fighter himself), the term of the Agreement is forever.

·       The term of the Agreement lasts forever, and the Marketing Rights for fighter are held by Zuffa even after a fighter is cut!

·       The Agreement requires a fighter to make up to Six (6) appearances per year, and each of the appearances may be required of the fighter for no additional compensation.

·       The Agreement contains no audit rights which would provide a mechanism for a fighter to enforce the terms of the Agreement and to verify payments are fair.

·       The Agreement enables Zuffa to divert royalty and licensing payments by shifting income that could be classified as a license or royalty fee entitling a fighter to payment, into a payment that is Zuffa’s income alone.

·       The Agreement requires a fighter to warrant that all permissions have been obtained to utilize third party marks and copyrights.

·       The Agreement does not offer any royalty or license payments for video games and DVDs.

·       The Agreement prohibits a fighter from not only using Licensed Marks of Zuffa, but also mere words alone!

Most contracts are restrictive above and beyond what is necessary because lawyers want to avoid clever fighters sneaking through loopholes. But the UFC has proven over and over again that they’re perfectly willing to take the smallest provision in any contract you sign and hang you with it if you piss them off.

I’m not sure the merchandising agreement is any good for the fighter on the surface – I considered pretending to know more than I really do about it, but it was too hard. So now I’ll just admit that I’m clueless. But I would hazard to say that the contract stinks just because of how the UFC might use it in court to wreck your shit down the road.

  • All the bitching an moaning over this contract to give the guys more avenues for getting the proverbial cheddar but has anyone have the closest inkling of an idea as to what the WWF has their guys sign away their rights when it comes to merchandising for those guys who aren’t on the upper echelon? I’m sure the WWE is a bit more generous to their guys than the UFC would lead you to believe but this contract issue is probably moreso a standard than we realize.

  • Burtonchik says:

    sounds like fighters need better lawyers/agents

  • goo says:

    Tito getting sued for wearing his own fucking belt.
    Lindland getting fired for being sponsored by the “wrong” casino.
    Trying to stop Randy from cornering fighters.

    If Tito, Lindland and Randy were all the same person imagine how pissed off they’d be!

  • How about we not use the WWE for a standard … they’re famous for making money off the bodies, health and lives of their unfortunate employees

  • FL, my issue with it all is this there’s no union to get a standard going, ie. MLBPA which handles negotiations, deals for players etc. It ain’t like WammaBamma or whatever that joke of a “rankings commission” is called, is gonna come in swoop up all the deals and be everyones money savior either.

    I compare WWE business practices to ZUFFA because they deal with the same people. Toys? Shirts? Fucking Beanie Babies? whatever the UFC and Silver Buff are gonna stamp/brand out there… the WWF has already done it. This isn’t a “simpson/carlin did it” joke, but rather ZUFFA holds events in the same buildings the WWF does and theyare doing business with Jakks, who’s been the WWF”s toy maker for how many decades now? Shit when I was 8-9 years old I had the WWF collections, not just the big unbendable ones but the 5 inch plastic style ones, now fastforward 15 years later, the toy business is huge and now ZUFFA is getting in the game, lining up deals with Wal Marts, Toys R Us’ and the whole deal. So to compare what the “UFC is giving their fighters” as compared to other business transactions that are similar in nature to these deals is a reasonable comparison since there’s nothing else to base the deals off of, nor to gauge the building interests in such items.

  • Goo: Tito wasn’t “sued” he was sent a “cease and desist” letter, there is a difference although it’s usually just a technicality before an eventual lawsuit, in this case for potential lost earnings for ZUFFA.

    Zuffa is within their legal rights because their likeness/image etc is being used without their expressed written consent… You’ve heard the disclaimers during baseball games, about rebroadcasting, using copyrighted logo’s etc. This ultimately falls into the same catagory and it is no different than say if Jose Canseco wore his old Oakland jersey on the cover of his book, You know that MLB would go after someone who was using their copyright protected images for some other person/companies personal gain.

    To sit around and say “well it’s different” or anything other than the fact that Zuffa is within it’s legal footing for their actions is just absurb and probably bordering on ignorant.

  • garth says:

    new rule: comments that have more then forty thousand words go in the forums, or in your own blog.

  • D. Capitated says:

    So to compare what the “UFC is giving their fighters” as compared to other business transactions that are similar in nature to these deals is a reasonable comparison since there’s nothing else to base the deals off of, nor to gauge the building interests in such items.

    The only problem is that the UFC and WWE handle their talent in a totally different fashion. The WWE signs guys based on potential drawing power on what they as a company can create around the person: “look”, interview skills, and what not. After all, they pick the winners in their contests well ahead of time. The UFC does not have that luxury. They can have someone that is a great interview or has a very unique look, but if he can’t actually win fights, he’s not worth two red cents. Brock Lesnar might be a great fighter 3-4 years from now when he gains significantly more experience, but if he gets Tom Erikson’ed this summer, he probably won’t be gaining that experience in a UFC ring, even if he was a pro wrestling champ and looks “scary”.

  • The way the terms of the contract is being described seems way over the top and I’m no expert, but it doesn’t seem like it would hold up in court. The guy would lose his likeness rights forever? That’s crazy.

  • dragomort says:

    Yeah, the ‘in perpituity’ clause alone would kill them should they ever go to court and get a ruling. The rest of it is at least feasibly fair game, but that one would cause the contract to get laughed out of court, more than likely.

  • Laughed out of court after 14 months and god knows how many tens of thousands of dollars worth of legal fees

  • dragomort says:

    Yep, thus the problem. It’s rather unenforcable, but it has to be fought before anything can be done, and good luck effectively doing that.

  • Rob says:

    Thanks fight linker for touching on this. Ive been waiting to hear your two cents on the matter.

    So they are going to be able to put all the ufc characters in the new game without paying them? Man how greedy are these guys.

  • Donk says:

    fedor didn’t sign for a good reason

  • Fedor didn’t sign because his management team are all crazy russians

  • Hammer says:

    I hope the MMA dolls have protruding foreheads in accordance with the gross over use of HGH.. We all want realistic in our toys………….

  • trevdawwg says:

    First of all comparing a legitimate sport to WWF is stupid on any level. MMA fighters are athletes not actors. Athletes deserve to be fairly compensated for their performance. Any profits made by ensuing endorsement deals or merchandising should belong soley to the athlete. (see any other freaking sport!)

  • Hammer says:

    Dana White is starting to make Don Kind look generous.

  • Hammer says:

    King that is