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.