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Law360 (September 9, 2020, 10:48 PM EDT ) A champion Mexican middleweight boxer has hit the British-owned sports streaming service DAZN Media and his Los Angeles promoters with a breach-of-contract suit in California federal court, claiming he's owed more than $280 million under a per-bout deal that purportedly collapsed amid the coronavirus pandemic.
Boxer Santos Saul Alvarez Barragan, who is popularly known as Canelo Álvarez, and his business entity SA Holiday Inc. accused DAZN Media and his promoters, Golden Boy Promotions LLC and Oscar de la Hoya, on Tuesday of failing to deliver on a 2018 contract under which he was allegedly promised $35 million per fight for at least 10 of 11 bouts.
"Alvarez has fought the first three of his eleven fights under the Alvarez and DAZN contracts, he is owed remaining guaranteed payments of $280 million dollars," the suit says.
The dispute goes back to October 2018, when Alvarez signed a five-year contract, which his promoters at Golden Boy Promotions called "historic" and claimed was worth $365 million, according to the complaint. Under the deal, his promoters agreed to pay Alvarez up to $35 million per fight for 10 bouts and $15 million for his fight with British boxer Rocky Fielding.
Days before Alvarez signed a contract with his promoters, Golden Boy Promotions entered a separate contract with DAZN under which the sports streaming service purportedly agreed to pay the promoters a $40 million per bout licensing fee for the 10 fights that were expected to occur between 2019 and 2023, and a lower licensing fee for Alvarez's December 2018 fight with Fielding.
At the time the contracts were signed, Alvarez's three previous matches had each sold more than 1 million pay-per-view buys domestically and generated hundreds of millions of dollars in revenue worldwide, according to the suit.
After the parties entered the contracts, Alvarez fought and won three boxing matches, securing the WBA World Super Middleweight title by beating Fielding in 2018 and the WBO World Light Heavyweight title last year.
Alvarez claims in his lawsuit that he delivered on his end of the deals and traveled around the world promoting his fights and DAZN. Late last year, the parties discussed Alvarez's fourth bout, which was planned for May, but it was canceled due to the coronavirus outbreak, the suit says.
The parties in the suit allegedly discussed holding Alvarez's fourth match this month without fans present, but in the summer, DAZN "unambiguously stated" that it would not pay the promoters their purportedly required $40 million license fee. DAZN took issue with the fact that Alvarez had not chosen Kazakhstani professional boxer Gennady Golovkin as an opponent in 2019 and that Golden Boy Promotions had not put forth a plan for a second Alvarez fight in 2020, among other things, according to the complaint.
In light of its concerns, DAZN only offered to pay Alvarez and Golden Boy Promotions a fraction of the $40 million license fee in cash, along with DAZN stock in advance of its anticipated initial public offering, but Alvarez claims the offer fell far short of DAZN's contractual requirements.
"The entire value of the package — for a bout against another World Champion — was substantially less than Alvarez' contractual guarantee," the complaint says.
Alvarez claims that since DAZN's refusal to pay in full, his promoters have failed to secure another broadcaster or put forward another plan under which he would be paid the $35 million per-bout fee allegedly guaranteed under their contract.
The 10-count complaint asserts fraud and multiple breach-of-contract claims, and it seeks compensatory and punitive damages, plus costs and attorney fees.
Along with the promoters, the suit names as defendants DAZN Group Ltd.'s U.S. subsidiaries and affiliates — DAZN North America Inc., DAZN Media Inc., DAZN US LLC and Perform Investment Ltd.
Counsel for Alvarez and his company and representatives for the promoters and DAZN didn't immediately respond to requests for comment.
Alvarez and SA Holiday are represented by Gregory M. Smith and Patrick M. Maloney of The Maloney Firm APC.
Counsel information for the defendants wasn't immediately available.
The case is Santos Saul Alvarez Barragan et al. v. DAZN Media Inc. et al., case number 2:20-cv-08226, in the U.S. District Court for the Central District of California.
--Editing by Nicole Bleier.
For a reprint of this article, please contact reprints@law360.com.
