A Quick Look at What Ali Act Disclosures Actually Consist of

Professional boxing is rife with claims by its fighters and their management that promoters are routinely less than transparent as to the revenues and expenses that arise from a given fight card. Interestingly, despite such claims, it is not multiple choice under U.S. federal law as to whether promoters must turn over this information to their boxers. They must. This is because the Ali Act provides, in relevant part, that:

“[a] promoter shall not be entitled to any compensation directly or indirectly in connection with a boxing match until it provides to the boxer it promotes: (1) the amounts of compensation or consideration that a promoter has contracted to receive from such match; (2) all fees, charges, and expenses that will be assessed by or through the promoter on the boxer pertaining to the event, including any portion of the boxer’s purse that the promoter will receive, and training expenses; and (3) any reduction in purse contrary to a previous arrangement between the promoter and boxer or a purse bid held for the event.”

The logical follow-up question to the above-cited statutory language is what a boxer could/should actually expect upon receiving what is commonly known as the “Ali Act disclosures” from their promoter following a bout. To put it another way, what do/should Ali Act disclosures consist of? The answer includes, without limitation, as follows:

1. A breakdown of the revenue sources/amounts (broken down further below);

2. A breakdown of the expenses that go into a given bout and/or fight card (i.e., medicals, licensure fees, hotels, ring card girls, advertising, ticket printing, etc.);

3. A provision of service/license agreement with the primary television network or streaming service televising the show in the United States (i.e., the Showtime or DAZN agreement);

4. Copies of the executed athletic commission contracts for a given bout and/or fight card;

5. Copies of the canceled checks given to the boxers in a given bout and/or fight card;

6. A sanctioning body’s breakdown of any fees/other expenses affiliated with a given title bout/eliminator;

7. A state athletic commission’s broadcast and television additional licensee fee report;

8. Documentation of site fees that a promoter had to provide to the venue and an accompanying agreement between the promoter and venue detailing same;

9. Insurance information for the event as a whole and the individual boxers/ bouts;

10. Travel and event management costs;

11. Per diem costs for each boxer and their entourage;

12. Copies of all broadcast/licensing/streaming/ replay rights agreements. It should be noted here that these can vary greatly per card. By way of example, if a world title bout features either a boxer from a particular country that may not otherwise televise a professional boxing contest, or an opponent of a world titleholder from that country, one would expect a broadcast rights agreement from that particular country for that card, even if that country would not otherwise be expected to acquire it. Each of these agreements will necessarily include how much a distributor/network in each territory paid for the rights;

13. The box office information, including all comped, sold, and unsold tickets and how much was generated as a result of same; and

14. Pay-per-view information, including any agreements with domestic pay-per-view distributors and the sales/revenues generated from each. This is plainly of the highest importance when a boxer’s purse for a given bout is based, in part, upon pay-per-view sales.

Whether or not all of these disclosures should be expected would depend, in part, on the size and scope of coverage of a given card.

The next question one may ask is why should a boxer seek all of this paperwork from his/her promoter, aside from making sure that their management and/or legal counsel earn their pay and enforce their rights under the Ali Act? The simple answer is that knowledge is power. How does a boxer and his/her management team effectively negotiate how much a boxer should earn for a given bout, especially on the world championship level, if they are not fully informed as to what the financials are that arise from a given bout/ fight card? In sum, if the Ali Act disclosures are not sought, disclosed, and reviewed, a professional boxer, an athlete in a sport where each contest has the potential to be his/her last, may very well be routinely receiving less than his/her true value.

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Please do not hesitate to contact the Law Offices of Paul S. Haberman LLC with questions on any legal, regulatory, or contractual issues that you may encounter in the combat sports world.