Did the Golden Boy’s reputation take a hit
Derrick Thomas sits on his stool trying to collect his thoughts after being knocked out by Marcus Upshaw (rear), July 10, 2009. Boxers like Thomas need a lot of help when they're dealing with the shady promoters.
The other day reports serviced that Los Angeles-based Golden Boy Promotions was suspended for 90 days by the New York State Athletic Commission. Over the years, that type of news has been common amongst boxing promoters who believe they, not the hard working boxer, deserve the majority of the dough from every boxing show. And since Oscar De La Hoya as the titular head of Golden Boy Promotions swore in his mission statement to end the questionable practices by the shady promoters, the current news makes him appear as bogus as the rest of the charlatans who preceded him.
Allegedly the suspension was administered because Home Box Office (HBO) provided Golden Boy $750,000 for a May 15 fight between Ortiz and Campbell, but the fighters only received $225,000.The speculation is that Golden Boy underpaid the fighters without informing them and then funneled some of that money into the main event between Amir Khan and Paulie Malignaggi.
The investigative piece that uncovered this deed was written by Thomas Hauser in his Seconds Out.com article which begins:
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Let’s start with some basic facts: (1) On May 15, 2010, HBO televised a Boxing After Dark doubleheader pairing Amir Khan against Paulie Malignaggi and Victor Ortiz vs. Nate Campbell. (2) HBO paid a US $1,500,000 license fee for Khan-Malignaggi and a $750,000 license fee for Ortiz-Campbell. (3) New York State Athletic Commission records state Victor Ortiz received a $100,000 purse and Nate Campbell received a $125,000 purse. These numbers have been confirmed by secondary sources. Campbell received an additional $25,000 for training expenses. (4) DiBella Entertainment (Malignaggi’s promoter) and Golden Boy Promotions (which promotes Khan, Ortiz, and Campbell) had a contract which provided that the HBO license fee for Khan-Malignaggi would be split 60 percent to Golden Boy and 40 percent to DiBella Entertainment. Golden Boy was to receive the entire license fee for Ortiz-Campbell. Now some questions: (2) If the license fee for Ortiz-Campbell was really $750,000, why did the fighters get only $250,000? Here, Golden Boy can point to the fact that it had to pay $150,000 to Don King Productions as part of a buyout deal for Nate Campbell’s contract and approximately $125,000 to Top Rank as part of a litigation settlement regarding Victor Ortiz’s contract. Now we come to the heart of the matter. Ortiz-Campbell was the opening bout on a Boxing After Dark telecast. A $400,000 license fee would have been generous payment for that match-up. Indeed, it’s highly unlikely that another television network would have paid anything close to $400,000 for Ortiz-Campbell. Why the extra $350,000? Golden Boy CEO Richard Schaefer says, “HBO wanted that particular fight. If HBO didn’t pay what it did, Ortiz-Campbell wouldn’t have happened.” |
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| But there’s an alternative theory. Suppose HBO and Golden Boy shifted $350,000 from the license fee for Khan-Malignaggi to the license fee for Ortiz-Campbell? That would have deprived DiBella Entertainment of $140,000 (DBE’s 40 percent share of the $350,000) and put that money in Golden Boy’s pocket to help pay Amir Khan’s purse.
Since DiBella and Malignaggi had a 75-25 split in Paulie’s favor, that would have cost DiBella $35,000 and Malignaggi $105,000. Bob Arum says he’s entitled to 30 percent of Golden Boy’s profits on Ortiz-Campbell; not a flat number. The $125,000 payment to Arum referenced above is based on Golden Boy’s estimate of what the profit from Ortiz-Campbell will be. In that regard, it wouldn’t make sense for Golden Boy to move license-fee money from Khan-Malignaggi (where it’s paying 40 percent to DiBella) to Ortiz-Campbell (where 30 percent of the overage goes to Arum). That would be a minimal saving to Golden Boy. The $150,000 payment by Golden Boy to Don King Productions is another matter. King says the $150,000 that he’s entitled to from Ortiz-Campbell is a flat number, not percentage-based. It would make a lot of sense economically for Golden Boy to move money from Khan-Malignaggi (where it’s paying 40 percent to DiBella) to Ortiz-Campbell to pay King. During the past few years, there have been complaints throughout the boxing industry of improprieties in the relationship between HBO and Golden Boy. Is this an example? If so, the legal ramifications could be significant. |
Attached are some choice comments from boxing fans:
Guest: I’ve been a boxing fan since the 1970s. There are a lot of shady characters in the fight game. I remember Oscar and GBP saying they were going to clean up boxing. However, as Nietzche said, “Be careful when fighting monsters that you do not become a monster.” Behold the new monster!
JSinCali: Not a stupid question but the answer is that this is an example of what Mills Lane called the “flesh merchants.” They are people (promoters, managers, etc) that make money off of fighters blood and sweat. I’ve never seen it put in such clear dollar sense but it looks to me like the dirty truth about how the sport works. HBO subscribers, let’s let our voices be heard! Email HBO here: www.hbo.com/#/about/contact.html
If anyone has a more direct contact please share. Things will never change unless we make our voices heard. Thank you, Mr. Hauser. Not to be melodramatic but you continue to carry on the great journalistic tradition of Upton Sinclair and Ida Tarbell.
Dagul Dimasalang: Clerical error? W T F! Golden Boy Promotions is a FRAUD.
Balagtas: Do you remember how much they wanted to give Manny when Oscar fought him? As little as 25% while Oscar was to receive 75% and then he goes inside the ring and cowardly stops fighting after round eight without a single drop of blood in his handsome face.
FMJ: Golden Boy Promotions & GAYWEATHER are Super Idiots and Cowards, FRAUDS! It’s a good thing that Manny transferred to TOP RANK! GBP are blood suckers. Oscar De LaHoya is a frustrated fighter after becoming a punching bag for Manny. They’re fraud partners in crime. Soon these people will land in jail.
Ding Dong: Golden Boy Promotion credibility – R.I.P.
Hans: Oscar deserved to be exposed. What comes around; goes around. That what’s he gets for trying to destroy Manny Pacquiao’s reputation. I believe in karma…it’s payback.
Cashmoney: Wow…now that’s REAL news…golden crooks!
Kim die young: GREEDY BOY PROMOTIONS IS BAD FOR BOXING.
On Monday, July 12, 2010, Golden Boy Promotions believed it was important to report the true facts concerning its 90 day suspension by the New York State Athletic Commission.
On July 9, 2010, Golden Boy learned that it had been suspended by the NYSAC for a period of 90 days. Although Golden Boy respectfully disagrees with one of the Commission’s charges – that there was dishonesty on the part of a Golden Boy employee – Golden Boy does acknowledge that a number of significant, but innocent, mistakes were made in failing to make timely responses to legitimate information requests from the NYSAC. Golden Boy has now made all requested disclosures to the NYSAC.
Although innocent, these errors were not consistent with or reflective of Golden Boy’s commitment to fairness, honesty and transparency in the sport of boxing. New York counsel for Golden Boy has already spoken to representatives of the NYSAC this morning, and has apologized for Golden Boy’s mistakes.
At the outset, before explaining what transpired, it is important to dispel some false statements made by certain reporters concerning the suspension.
1. THE NYSAC’S SUSPENSION NOTICE DOES NOT ALLEGE OR SUGGEST ANY FINANCIAL MISCONDUCT ON THE PART OF GOLDEN BOY.
2. THE NYSAC’S SUSPENSION NOTICE DOES NOT ALLEGE OR SUGGEST THAT THE SUSPENSION IN ANY WAY RELATES TO THE LICENSE FEES PAID BY HBO FOR THE TWO TELEVISED BOUTS ON MAY 15, 2010. IN FACT, GOLDEN BOY DISCLOSED ITS CONTRACTS WITH HBO AND DIBELLA ENTERTAINMENT TO THE COMMISSION ON MAY 19, 2010 – JUST 4 DAYS AFTER THE MAY 15 EVENT.
3. DIBELLA ENTERTAINMENT HAS ALREADY INVESTIGATED THE LICENSE FEE “ISSUE,” AND INFORMED GOLDEN BOY AND COUNSEL FOR MR. MALINAGGI THAT IT DOES NOT BELIEVE THAT THERE WERE ANY IRREGULARITIES.
4. NYSAC’S SUSPENSION NOTICE DOES NOT ALLEGE OR SUGGEST THAT GOLDEN BOY FAILED TO PROVIDE REQUIRED ALI ACT DISCLOSURES TO FIGHTERS ON THE MAY 15, 2010 CARD. TO THE CONTRARY, ALL SUCH DISCLOSURES WERE PROVIDED.
5. THE NYSAC SUSPENDED GOLDEN BOY WITHOUT FIRST GRANTING IT A HEARING OR A WARNING. HOWEVER, THE NYSAC WAS NOT IN ANY WAY OBLIGATED TO PROVIDE SUCH A HEARING OR WARNING.
The true facts are as follows:
1. Following the May 15, 2010 event, a Golden Boy employee apparently mistakenly informed the NYSAC that Golden Boy did not have any written agreements with the fighters other than the bout agreements for the bouts that took place on May 15. In fact, Golden Boy had written agreements with some of the fighters on the May 15 card. This was an innocent error made by someone who should not have made the representation without taking steps to ensure its accuracy.
2. On May 19, 2010, the NYSAC requested both the HBO and DiBella Agreements, as well as any written agreements between Golden Boy and the fighters on the May 15 card. As noted, Golden Boy immediately produced the HBO and DiBella Agreements. The GBP employee normally in charge of dealing with Commission matters, left for his honeymoon immediately following the May 15 event and was unable to be contacted, however, the person responding to the request erroneously questioned the NYSAC’s authority to request copies of Golden Boy’s promotional contracts, asked for the basis for the requests, and did not send those contracts. This was clear error on the part of the Golden Boy, as under all circumstances, the contracts should have been sent to the ABC.
3. Unfortunately, and despite other requests by the Commission, Golden Boy’s response was inexcusably delayed.
4. On July 1, 2010, Golden Boy contacted the Commission by sending it an email which stated that the contracts did not have to be disclosed to the NYSAC because they would not be held confidential. According to counsel for the Commission, this conclusion as to the confidentiality of the requested disclosures issue was erroneous. In any event, Golden Boy erred in not immediately sending the contracts to the ABC at this point in time.
5. On July 6, 2010, the NYSAC, as it had the absolute right to do under its Rules, suspended Golden Boy without a hearing. At that point, Golden Boy immediately sent the requested contracts to the ABC. Today, upon the representation of counsel for the Commission that the requested contracts were not subject to public disclosure, Golden Boy sent all of the requested contracts to the NYSAC.
Sport of Boxing’s editorial comment: This is just one more example of why we need lawyers involved in every thing we do or say. Something that should be clear becomes muddled. After a law office adds the proper twist or spin to a situation like this, everything becomes imprecise, vague, indistinct, and in the end so ambiguous how could anyone be found at fault.
