Antitrust Law Daily Wrap Up, ANTITRUST—D. Nev.: UFC must produce previously redacted email in monopolization dispute, (May 31, 2016)

By Jody Coultas, J.D.

The federal district court in Las Vegas has ordered Zuffa, LLC, operating under the trademark Ultimate Fighting Championship or “UFC,” to produce an unredacted email, holding that the contents were not protected by the attorney-client privilege (Le v. Zuffa, LLC, May 26, 2016, Leen, P.).

Zuffa allegedly engaged in a scheme to maintain and enhance a monopoly in the market for promotion of live elite professional Mixed Martial Arts (MMA) fighter bouts and fighter services. MMA fighters alleged that Zuffa prevented class members from gaining access to critical resources to successful MMA promotions by imposing extreme restrictions on UFC fighters’ ability to fight for would-be rivals during and after their tenure with the UFC.

At issue was an email sent by Zuffa’s outside counsel to Zuffa employees concerning its acquisition of rival mixed martial arts promoter Pride FC. The email was produced as part of approximately 100,000 documents Zuffa originally produced during an FTC investigation of Zuffa’s acquisition of rival promoter Strikeforce. The email was produced with an electronic slip sheet indicating it was withheld as privileged, but the document was not removed from the production. Zuffa submitted a redacted version of the email claiming certain portions were privileged and certain portions were not. The class members disputed that some of the redacted portions of the email were attorney-client protected.

Relying on the doctrine of selective waiver, the class members argued that fundamental fairness prohibits a privilege holder from selectively disclosing privileged communications to an adversary revealing those that support the adversary’s case while withholding information that is less favorable. The class members asked the court to order Zuffa to withdraw the challenged redactions to the email and produce an appropriately modified version for use in the litigation.

Generally, the voluntary disclosure of privileged attorney-client communications constitutes a waiver of the privilege as to all other such communications dealing with the same subject matter. To determine whether there was a waiver of attorney-client privilege, the court looks at: (1) whether a party is asserting the attorney-client privilege as a result of some affirmative act; (2) whether the party asserting the privilege through an affirmative act has put the privileged information at issue; and (3) whether allowing the privilege would deny the opposing party access to information vital to its case.

The majority of the redacted paragraphs in dispute were not privileged, according to the court. One of the claims in this case is that Zuffa acquired Pride FC as part of an anticompetitive scheme to acquire and eliminate rivals. The first redacted paragraph was related to Pride FC’s negotiating positions, the fact that Pride FC did not trust Zuffa anymore than Zuffa trusted Pride, and that Pride did not want its business tied up any longer in negotiations. Because the paragraph concerned the parties’ negotiating positions and did not contain legal analysis or advice, attorney-client privilege did not apply.

The second paragraph related to Zuffa’s business purpose for the acquisition—to stop others from buying Pride FC, to acquire Pride FC in order to shut that business down, and to acquire Pride FC’s fighters for the UFC. This paragraph also related to Pride FC’s negotiating position, and was not privileged, the court determined.

A portion of the last sentence of the paragraph, however, related the client’s concern about a legal matter and was privileged, according to the court. The last sentence concerned a legal issue Zuffa and its counsel discussed with the expectation it was a confidential communication.

The remaining communications did not relate to legal advice sought by or given to Zuffa, but merely related Pride FC’s communications to Zuffa’s counsel during negotiations. The email related to the negotiating parties’ commercial strategies and tactics, rather than legal advice.

The class members’ motion to challenge privilege was granted and Zuffa was ordered to produce the email unredacted of the paragraphs in dispute, with the exception of the last sentence of disputed second paragraph.

The case is No. 2:15-cv-01045-RFB-PAL.

Attorneys: Andrew Michael Purdy (Joseph Saveri Law Firm), Benjamin Doyle Brown (Cohen Milstein Sellers & Toll PLLC) and Bradley Scott Schrager (Wolf, Rifkin, Shapiro, Schulman & Rabkin) for Cung Le. John F. Cove, Jr. (Boies Schiller & Flexner LLP) for Zuffa, LLC.

Companies: Zuffa, LLC

Cases: Antitrust NevadaNews