Ultimate Intellectual Property Fighting

The smackdowns doled out in pay-per-view sports like boxing and ultimate fighting may be nothing in comparison to the financial beatings many club, restaurant and bar owners take when they fail to kick in a commercial fee to show these pay-per-view television events.

A combination violation of satellite cable and copyright laws can set bar owners back tens of thousands and evens hundreds of thousands of dollars. The legal fees racked up in intellectual property suits also become the burden of sporting event “pirates.”

Promoters for the Ultimate Fighting Championship, Joe Hand Promotions and J&J Sports aggressively pursue hundreds of anti-piracy cases every year. Like the tactics sometimes used by the athletes they promote, the promoters use every possible resource to recover lost revenue. Investigators are sent to establishments undercover to observe and photograph violations of the satellite and copyright rules. The promoters’ agents seek out businesses that try to get around a commercial pay-per-view fee of up to $3,000 by using a home-based $50 set up.

Promoters say they protect their own property as much as they help above-board businesses who pay the going rate for commercial fees. Some paying venues watch competitors and track down neighborhood satellite offenders for the promoters.

It is daunting for small bar or club owners faced with litigation expenses and penalties for satellite violations. Some smaller business owners rush to settle for a few thousand dollars rather than go up against a promoter. Business owners found guilty of willfully interfering with cable to gain a “commercial advantage” may be stuck with damages and infringement penalties few can afford.

Promoters and lawyers say the penalties are high on purpose. A club owner punished for “piracy” is less likely to repeat the offense. But perhaps on many occasions the bar owners did not even know the laws existed.

Source: Businessweek, “Ultimate Fighting, Boxing on Pay TV Spark Pirate Lawsuits,” Thom Weidlich, Apr. 13, 2012