Shamrock Appeals UFC Lawsuit Decision

By J.R. Riddell Apr 10, 2010
File Photo: Dave Mandel/Sherdog.com


Ken Shamrock took the first step last week in appealing the significant legal defeat he encountered in his suit against the UFC’s parent company, Zuffa LLC. Shamrock filed his notice of appeal with Nevada’s highest state court, urging it to reverse trial Judge Susan H. Johnson’s judgment after trial in which she concluded that, contrary to Shamrock’s legal claims, Zuffa had no contractual obligation to promote any Shamrock fights after he came out of his short-lived retirement in 2007.

Shamrock sued Zuffa for breaching a promotional rights contract that was entered into between the two parties while setting up Shamrock’s final rematch with Tito Ortiz, which took place on October 10, 2006. At the conclusion of a two-day non-jury trial before the judge in February, the Las Vegas-based jurist ruled in favor of Zuffa’s interpretation of the contract and found that the promotional company was not liable to Shamrock for any damages he allegedly suffered.

Additionally, on Thursday Judge Johnson ordered Shamrock to pay $175,000 in Zuffa’s legal fees. The award was based on an attorneys’ fees provision included in Shamrock’s UFC contract, which provided that in the event of litigation the losing party would reimburse the prevailing party for all reasonable attorneys’ fees incurred.

At this stage, Shamrock has put Zuffa and the court on notice that he is appealing the judge’s decision, but has not yet identified the legal and factual arguments supporting his claim that the trial judge got it wrong. According to Shamrock’s agent and sports attorney, Rodney Donohoo, under Nevada rules Shamrock was not required to identify with specificity the legal issues on appeal at this stage of the proceedings. Instead, as ordered by the appellate court, the parties must first engage in compulsory mediation, which is expected to take place in May. In the event the mediation is unsuccessful, the parties will then submit their written legal arguments on dates provided for in a court-set briefing schedule.

While the issues on appeal have not been formally identified, Donohoo, who was also a key witness during the trial, told Sherdog.com he respectfully disagreed with the judge’s decision on at least two grounds. First, Donohoo believes that the trial judge committed reversible error by concluding that the contract language committed Shamrock to the UFC for one more bout if he came out of retirement, but that Zuffa had no reciprocal obligation to accept and promote such a fight. A second issue identified by Donohoo is whether, based on a variety of facts presented at trial, Shamrock legally waived Zuffa’s breach. According to Donohoo, the judge’s “factual findings are inconsistent with the evidence presented, and with the stipulations entered into by the parties prior to trial.”

“From my viewpoint, the underlying contract was clearly not a unilateral option agreement, and no rights were waived in this case on the part of the Plaintiff,” said Donohoo.

Zuffa’s Las Vegas-based trial attorney, Donald Campbell, disagrees with Donohoo’s assessment.

“Judge Johnson knows what she’s doing,” he said.

Campbell believes the appeal is “ill-conceived” because the “highly-respected” judge’s 17-page decision is supported by the evidence and testimony presented at trial. According to Campbell, the evidence and testimony demonstrates that Shamrock’s camp failed to follow recognized principles of contract law by failing to formally declare a breach, failing to demand Zuffa perform under the contract or cure its shortcomings, and acquiescing in the termination of the contract. Campbell said Shamrock’s “chances on appeal are between slim and none.”

Earlier this week, the UFC announced via press release the award of $175,000 in legal fees to Zuffa. In the release, Zuffa’s attorneys, Campbell and J. Colby Williams, are quoted as saying, “This latest legal victory on behalf of Zuffa demonstrates, once again, that the UFC is fully committed to vigorously enforcing all of its contractual rights. Judge Johnson has determined Mr. Shamrock’s hard lesson learned in this case will cost him approximately $175,000.”

Donohoo was not surprised by the ruling given the attorneys’ fees clause in Shamrock’s UFC contract. However, he expects that after appeal, Ken Shamrock Inc., will be deemed the prevailing party and therefore be entitled to collect all its attorney fees from Zuffa.

“Based on the wording of the release, it my impression that it was sent as a marketing opportunity and to attempt to deter others from litigating against the UFC, which would be an unfortunate message to take away from this litigation,” said Donohoo. “As he has lived his entire life, Mr. Shamrock acted courageously in going to Las Vegas and facing the UFC. I am honored to continue to represent Mr. Shamrock, who… stands up for what he thinks is right, regardless of the odds, popularity of his decision, or the consequences.”

“J.R.” Riddell, an attorney at the global law firm Orrick, Herrington & Sutcliffe, is experienced in various matters related to the business of MMA. A more detailed background regarding his experience is available through his lawyer profile at www.orrick.com. 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 his law firm. Riddell can be reached at jriddell@sherdog.com. Tracey Lesetar (tlesetar@sherdog.com) contributed to this article.
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