Late last night, the Minnesota Star Tribune released an article detailing lawsuits in the state for businesses airing UFC PPVs without paying the closed circuit fees that have long been associated with viewing parties for prize fights at bars. Legal columnist Dan Browning explains;
In the past two years, distributors and sponsors of these events have filed nearly three dozen federal lawsuits in Minnesota against taverns, restaurants and their owners, seeking damages in excess of $140,000 a pop.
While it costs about $50 to order a UFC event on pay-per-view in a private residence, it costs bars, restaurants and other commercial establishments $750 to $1,500, depending on their size.
Many of these figures have long been publicly available, but the rights to distribution and thousands of pending lawsuits are less visible facets of the bar and restaurant fight game. In fact, Joe Hand Productions-- the Feasterville, PA company that holds exclusive distribution rights for closed circuit UFC telecasts-- employs secret shoppers to exploit abuse of the service by way of false residential claims, Sling Box, illegal internet stream (double no-no) or transplant of a residential cable unit. The article details their covert course of action for this Saturday's UFC 150 PPV;
Mingling among the fight fans Saturday will be an army of private investigators and freelance "auditors" armed with smartphones and camcorders who are paid a bounty for finding establishments that show the event without paying the commercial licensing fees.
Such measures result in lawsuits bearing heavy settlements or federally supported fines that range in value from a wrist-slapping $5000 to an eye-popping $170,000. But even with such high liability, some bar owners plead ignorance to any legal wrong doing, as was the case for a small town bar in New Prague, Minnesota;
"It's criminal, what they're doing," said Jeffrey W. Jensen, co-owner of J.T.'s Hideaway, a small bar in New Prague that got slapped in July with a Joe Hand lawsuit demanding damages of $170,000. "I have nothing. I mean, we're behind on our house. We're behind on our bar payment," he said. "We're not rolling in dough here."
As the article goes on to state, ignorance is in no way considered a valid excuse in these cases. Jensen will be forced with the option to settle outside of court or face what will likely be significantly higher costs, in the courtroom as well as the penalties levied against his business.
Two questions immediately spring to mind; how much does Zuffa profit from the penalties or settlements that are appropriated or reached, respectively? And where do you, as an MMA fan, side on whether this is a fair punishment for bars that, whether by intent or folly, buck the strict laws associated with illegal closed circuit transmissions?