Liddell Sues MMA Authentics
Tracey Lesetar Jun 30, 2010
Chuck
Liddell and his company, Iceman Productions LLC., filed suit
against MMA clothing and gear manufacturers MMA Authentics LLC., in
Los Angeles Superior Court on June 22 in a bid to stop them from
selling certain products with Liddell’s likeness on them to
retailers such as Wal-Mart.
In his complaint, Liddell alleges that MMA Authentics, which was later taken over by Ultimate Brand Management and has also operated under the Cage Fighter, MMA Elite, and Familia Gladitoria brands, breached a 2007 agreement with Liddell that allowed them to make clothing and headwear bearing Liddell’s image, name, and/or signature in exchange for paying him 15 percent of the gross proceeds from the product sales. Liddell also claims that in breaching this contract, MMA Authentics invaded his privacy and engaged in unfair business practices under California law.
This is not the first time that MMA Authentics has been sued for
its business practices. In 2008, UFC and Strikeforce middleweight
Dan
Henderson sued the company in a dispute related to his
merchandising and sponsorship agreement with them.
The crux of Liddell’s complaint relates to two provisions in the 2007 contract. First, the contract states that MMA Authentics’ use of Liddell’s likeness is for clothing and headwear products only; the agreement does not explicitly give MMA Authentics rights to make and sell any other “Liddell” products. The second critical contract provision obligates MMA Authentics to obtain Liddell’s approval on production samples and/or artwork for the merchandise before selling it.
Liddell’s attorney wrote to MMA Authentics shortly after this apparent discovery, warning that the company was in breach of the 2007 agreement. The same letter -- which was submitted to the court along with the complaint -- asserts that MMA Authentics promised Liddell it would remove the unapproved products from shelves.
In October 2008, Liddell’s attorney again wrote to MMA Authentics, giving formal notice that the 2007 agreement was terminated, and accusing MMA Authentics of continuing to sell the unapproved products while simultaneously trying to negotiate “lower royalty rates” with Liddell. The letter threatened litigation if MMA Authentics did not immediately stop selling all “Liddell” merchandise and provide a full account of all its earnings from both the authorized and unauthorized sales.
This lawsuit, however, was not filed until over a year and a half after this “termination” letter was written. Although the complaint does not mention the delay, a September 2009 letter submitted with the complaint hints that negotiations may have been ongoing during late 2008 and 2009 in an attempt to “re-engage” Liddell with better contract terms and possibly settle the dispute informally.
Liddell is asking the court to award him whatever proceeds MMA Authentics has earned from selling the unapproved products, as well as an injunction that would keep the company from further selling any such products. He also seeks attorneys’ fees and punitive, or exemplary, damages that can be awarded at the court’s discretion and are intended to “punish” an offending party, deterring them from similar behavior in the future.
MMA Authentics will have the opportunity to file an answer with the court next month, which will likely yield a second side to this ongoing story.
Attorneys for both Liddell and MMA Authentics could not be reached for comment.
Tracey Lesetar, an attorney at the global law firm Orrick, Herrington & Sutcliffe, is experienced in various matters related to the business of MMA. This article does not provide legal advice, and any opinions expressed in this article are solely those of the author and do not reflect the views of the author's law firm. Lesetar can be reached at [email protected].
In his complaint, Liddell alleges that MMA Authentics, which was later taken over by Ultimate Brand Management and has also operated under the Cage Fighter, MMA Elite, and Familia Gladitoria brands, breached a 2007 agreement with Liddell that allowed them to make clothing and headwear bearing Liddell’s image, name, and/or signature in exchange for paying him 15 percent of the gross proceeds from the product sales. Liddell also claims that in breaching this contract, MMA Authentics invaded his privacy and engaged in unfair business practices under California law.
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The crux of Liddell’s complaint relates to two provisions in the 2007 contract. First, the contract states that MMA Authentics’ use of Liddell’s likeness is for clothing and headwear products only; the agreement does not explicitly give MMA Authentics rights to make and sell any other “Liddell” products. The second critical contract provision obligates MMA Authentics to obtain Liddell’s approval on production samples and/or artwork for the merchandise before selling it.
According to the complaint, Liddell discovered in August 2008 that
MMA Authentics was selling more than just clothing and headwear --
they were selling “novelty items” with Liddell’s likeness on them
as well. He claims that not only were these items never part of the
agreement; he also never approved them.
Liddell’s attorney wrote to MMA Authentics shortly after this apparent discovery, warning that the company was in breach of the 2007 agreement. The same letter -- which was submitted to the court along with the complaint -- asserts that MMA Authentics promised Liddell it would remove the unapproved products from shelves.
In October 2008, Liddell’s attorney again wrote to MMA Authentics, giving formal notice that the 2007 agreement was terminated, and accusing MMA Authentics of continuing to sell the unapproved products while simultaneously trying to negotiate “lower royalty rates” with Liddell. The letter threatened litigation if MMA Authentics did not immediately stop selling all “Liddell” merchandise and provide a full account of all its earnings from both the authorized and unauthorized sales.
This lawsuit, however, was not filed until over a year and a half after this “termination” letter was written. Although the complaint does not mention the delay, a September 2009 letter submitted with the complaint hints that negotiations may have been ongoing during late 2008 and 2009 in an attempt to “re-engage” Liddell with better contract terms and possibly settle the dispute informally.
Liddell is asking the court to award him whatever proceeds MMA Authentics has earned from selling the unapproved products, as well as an injunction that would keep the company from further selling any such products. He also seeks attorneys’ fees and punitive, or exemplary, damages that can be awarded at the court’s discretion and are intended to “punish” an offending party, deterring them from similar behavior in the future.
MMA Authentics will have the opportunity to file an answer with the court next month, which will likely yield a second side to this ongoing story.
Attorneys for both Liddell and MMA Authentics could not be reached for comment.
Tracey Lesetar, an attorney at the global law firm Orrick, Herrington & Sutcliffe, is experienced in various matters related to the business of MMA. This article does not provide legal advice, and any opinions expressed in this article are solely those of the author and do not reflect the views of the author's law firm. Lesetar can be reached at [email protected].
