UFC settled two antitrust lawsuits by agreeing to pay $335 million to resolve fighters' grievances, and the full settlement agreement has now been filed in court.
A settlement between the plaintiffs (fighters) and defendants (UFC) has already been reached and the court has “tentatively” approved the settlement agreement, bringing the litigation one step closer to a permanent end.
Under the terms of the agreement, UFC will deposit $100 million into an “interest-bearing escrow account” three days after the court gives preliminary approval of the settlement. A second $100 million payment will be made three days after the court gives final approval of the settlement or on Nov. 1, 2024, whichever is later.
The final $135 million payment is due by April 1, 2025.
“In consideration of the release of his claims,” former UFC fighter Nate Quarry will receive a lump sum of $250,000 as part of the settlement agreement. Quarry was one of the first fighters to file an antitrust lawsuit against UFC in 2014.
The agreement also contains a provision under which UFC will make certain adjustments to existing fighter contracts, as well as new contracts entered into during that five-year period, for a period of five years from the effective date of the settlement agreement.
The main components are:
- The fighters agree to negotiate exclusively with UFC for an “extension or renewal” of their contracts for up to 30 days. If the fighters are unable to reach an agreement on an extension or renewal, they “may negotiate with other promotional organizations,” subject to UFC's ability to match the offer.
- UFC's contract matching period is no more than four months, during which time UFC may match the financial terms of any other offers made to the fighter, and the fighter may not accept or enter into any agreement or contract with another promotion during this period without adhering to the matching period.
- If a fighter is offered a fight and “for any reason is unable to participate or unreasonably declines the fight,” UFC reserves the right to extend the contract for a period long enough to find a new opponent/date or up to six months, whichever is longer. “New opponent” means “an opponent different from the one previously offered and turned down.”
- If a fighter decides to retire from competition, the UFC can effectively freeze the contract for up to four years or terminate the fighter's contract during that period. Once a retired fighter reaches the four-year milestone, their contract will automatically terminate.
- There is also a clause allowing more freedom regarding fighters' name and likeness rights, with UFC retaining “non-exclusive worldwide rights” to use the fighter's identity.
As a reminder, these changes have been tentatively approved but will not become official until the court approves the settlement agreement.
Any amounts paid under the terms of the agreement will be deposited in the UFC Settlement Fund, which will then be used to make payments to eligible athletes who are the subject of the antitrust lawsuit.
While it could still be challenged, all signs point to it heading toward a final hearing, where the court will likely sign off on the settlement agreement to end the proceedings and bring the antitrust lawsuit against UFC to an end.
