Zuffa Sues Ken Pavia, Bellator for "Alleged Theft of Trade Secrets" [Updated]

via upload.wikimedia.org

Kevin Iole has the story:

Zuffa LLC, the parent company of the Ultimate Fighting Championship and World Extreme Cagefighting, has filed suit against Ken Pavia, one of the sport’s most prominent fighter agents, alleging Pavia passed along trade secrets and confidential Zuffa documents to rival mixed martial arts promotion Bellator.

...

An email which Zuffa’s lawsuit alleges is from Rebney to Pavia on July 4 was attached as an exhibit to the 16-page suit. In it, Rebney writes, " … You’ve been great about sending us ‘All’ of the seminal docs from the UFC, so that we can re-do them and implement them for Bellator."

Later, the email Zuffa alleges to have been written by Rebney continues, "Please list each in terms of what it is for and how the UFC uses them/implements them. … Then I’m going to have our team Monday re-type them and we will sufficiently alter them such that they will appear to be ours and not theirs."

The response that is purported to have come from Pavia is brief and says, in its entirety, "Still I (sic) vegas. May take 24 hours to organize as some forms go to the guys in my office."

I'm not a lawyer, so I can't comment on the actual legal proceedings here, but a couple of things stick out to me.

1. How did Zuffa obtain these e-mails? It seems odd to me that this sort of communication would reach eyeballs not belonging to Bjorn Rebney and Ken Pavia. Someone else must have received them, however, if they fell into Zuffa's hands.

2. Rebney's use of quotation marks around (and capitalization of) the word "all" makes my head hurt. It also makes the e-mail sound extra sinister.

3. Is this something that actually hurt Zuffa's bottom line or is it another ploy to keep a smaller organization in check?

Update [2:09 p.m. 7/30/2010]:

Kevin Iole updated his story with a quote from Bellator attorney Patrick English:

“I’ve looked at the paperwork, and I understand what’s going on here, and it is literally much ado about very little,” English said.

“There were documents sent by Mr. Pavia to Bellator, but they are not of a competitive nature and they would give no advantage or disadvantage to the viewer. The bulk of them in no way, shape or form would be considered confidential and are not what I consider to be documents that Zuffa should be concerned about.

“I did attempt to reach out to Zuffa [Thursday] and, unfortunately, have not gotten a return call. It happens that Bellator has not used any of the documents in any case.”

Justin Klein over at the Fight Lawyer also breaks down the complaint:

At the outset, from the face of the complaint, it is not clear what information was allegedly disclosed that is subject to trade secret protection. That said, Zuffa alleges that it doesn't know yet what "all" of the seminal documents are and so it would be pretty difficult to allege the confidential terms with any sort of specificity. Zuffa certainly seems to have enough to assert the claim.

In this regard, what you pay someone, who you deal with, or the duration of an exclusive contract could be a trade secret as could idiosyncratic or confidential business terms. That said, if stuff like that was redacted (that is, if the allegedly confidential information was whited out), then this would severely undercut any potential trade secret claim. In fact (and this is more complicated), if the confidential information was redacted, copyright preemption would likely come into play to bar a claim based upon retyping and rephrasing the non-confidential sections of the documents.

Next, it seems plausible from the allegations that the Doe defendants are fighters that allegedly had these confidential agreements with Zuffa and that the Roe defendants are plausibly venues and/or sponsors that allegedly had agreements with Zuffa that contained allegedly confidential or proprietary information.

Finally, and as an interesting competition point, assuming the case goes forward, Zuffa should get access to the Bellator agreements in discovery -- although this will likely be subject to a protective order that provides that the agreements are for "attorney's eyes only."

Justin also reveals that the e-mails in questions were also sent to Tim Danaher. Is Danaher the leak? I don't know. Who is Danaher? I don't know. The first result for "Tim Danaher MMA" on Google is the above post from the Fight Lawyer. The second result is a congratulations for new black belts and instructors at some Tiger Schulmann's MMA school.

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