What’s the Real Cost of that UFC Fight?

The Ultimate Fighting Championship events are hugely popular. Showing them in your bar or restaurant can potentially fill it with customers. However, what many owners and managers don’t know are the potential headaches that could follow. Did you order your fight from your cable or satellite provider? Did they assure you it was proper? Did you only pay $50.00 for it? If your answer to all three is yes, most likely you’ve got a big problem on your hands. If you only paid $50.00 for the fight, you likely received the residential rate…and that’s a problem. If you haven’t already, you’re probably going to receive a letter from a promotion company telling you that you illegally accessed the company’s exclusive signal and showed the fight illegally in your establishment. DO NOT IGNORE THIS LETTER.

This letter is not merely a scare tactic. This letter is the beginning of a legal headache – one which will not go away by ignoring it. The letter references a violation of The Communications Act of 1934; specifically, it references Section 503 and Section 605. In layman’s terms, it means that the company doesn’t know how you got the signal, but it knows you showed the fight. Essentially, Section 503 refers to cable signals while Section 605 covers satellite transmissions. The letter likely will reference damages over $100,000. When you receive the letter, you are probably thinking – ‘I’m innocent! I ordered and paid for the fight!’ And so you either simply ignore it because you have truth on your side or you respond by saying that you legally/properly obtained the fight. Here’s the problem – this law is considered a strict liability statute. “Strict liability” essentially means that whether you meant to or not, the fact is that you got the signal without paying the owner and you showed it to patrons, giving you an economic gain. Even more troubling is the fact that damages can exceed $100,000 and it is up to the Court to award these damages. And just as the cherry on top – you have to pay the attorney’s fees and costs for the promotion company (but if you win, they don’t have to pay yours!).

Unfortunately, many business owners do nothing even when they are eventually served with a lawsuit. The end result will be a default victory for the promotion company and the Court will award damages based upon what evidence, if any, the company has offered to enhance the damages against your business. While many of these cases have damages awarded in the $10,000-$25,000 range, the Court can award upwards of $100,000 if it finds the proper situation present.

So, what can you do? Well, you are not without options, however limited those options may be. Your very first move upon receiving this letter is to act and act quickly. As a business owner, this becomes a cost analysis situation. How much are you willing to spend defending this? How much time is this worth? How much can you spend to settle the case? While many lawyers may be too expensive or simply unwilling to take the case, there are attorneys that are familiar with these cases and can walk you through the law and the potential outcomes based on your facts. Since you will not be able to get your attorney’s fees back even in the case of a victory, you may find it financially advantageous to focus on settlement. While there’s no guarantee of settlement, an attorney with experience dealing with these lawsuits, may be able to work out a settlement that limits your loss and allows you to move on from this unfortunate mess and focus on growing your business.