September 01, 2011
Rumblings of Zuffa's union problems grew a bit louder today as the Culinary Union's Local 226, based in Las Vegas, sent a letter to the Federal Trade Commission, urging them to investigate the company that owns the UFC and Strikeforce for anti-trust violations.
The letter, provided to Yahoo! Sports and dated Aug. 31, 2011, said that Zuffa has risen to the top of the MMA marketplace by buying up entities like PRIDE, World Extreme Cagefighting and Strikeforce. They estimate that Zuffa controls 80-90 percent of the MMA market, and because of that power, they can wield power over their fighters.
Some examples from the letter include:
-- The champion's clause, which automatically renews a contract for UFC champions.
-- Merchandising rights that give Zuffa rights to a fighter's image in perpetuity. This clause is what Jon Fitch had a problem with when he was briefly cut from the organization.
-- Restraints on athlete's mobility and pay, meaning that by buying up the marketplace, Zuffa can keep a fighter from engaging the marketplace for fair pay.
The letter distinguishes Zuffa, who is not a league, from a league like the NFL, because contracts within a league must have these sorts of restraints for competitive balance. Zuffa is not competing with anyone.
"The anticompetitive restrictions it imposes on athlete mobility serves no legitimate business justification beyond stifling competition and increasing Zuffa's already dominant position in the market."
The letter is concluded by urging the FTC to look into Zuffa's practices.
The Culinary Union is not without ulterior motive in this case, as they take issue with Zuffa's majority owners, Frank and Lorenzo Fertitta. The Fertittas own Station Casinos, one of the largest non-union casino companies in the world.
But while their motive might be suspect, it doesn't soften who they are and what they have to say. Unions are meant to protect workers, and fighters are without union protection. Zuffa has made great strides in taking care of their fighters. Providing health insurance was a huge milestone in that, but all the benefits in the world doesn't mean that Zuffa can violate anti-trust laws.
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