With the increased popularity of televised pay-per-view mixed martial arts (MMA) and similar events, patrons of bars, restaurants, hotels, and other similar venues are demanding their availability while enjoying their drinks or meals. In response to these demands, there is an emerging trend where these events are being televised by establishment owners without permission.
Unfortunately for the bar, restaurant, or hotel owner who is engaging in such unauthorized activities, the pay-per-view industry is fighting back.
Nationwide, pay-per-view providers are increasingly suing restaurant, bar, and hotel owners on allegations that these establishments are showing MMA and other broadcasts without first obtaining proper permission. According to a national analysis of federal lawsuits, in 2009, 660 suits against businesses were filed by pay-per-view providers nationwide; by 2011, the number climbed to 1,612 cases.
And, the program owners are winning, leaving the establishment owner holding the bag for sizeable damages, becoming the target of increased scrutiny with respect to ongoing screening of similar events, and morphing into a victim of customer frustration when they are unable to view the programs they want while at their favorite bar or restaurant.
It is important for bar and other hospitality operators to recognize that they need to obtain express written permission from MMA and other pay-per-view program owners before showing these programs. Equally important is for these operators to fully comply with any rights they are granted to make sure no further action is taken.
As these program owners have been and will continue to be very vigilant in enforcing their rights (if programming is being shown without permission or if it is being shown outside the scope of the permission granted), failure to obtain and comply with such grant of rights could result in court-issued injunctions against showing the program, costly litigation, and hefty damages.
The following example illustrates the problem: In January 2011, Joe Hand Promotions—a distributor of closed circuit pay-per-view boxing, MMA matches and special events—sought $150,000 in damages in a federal court from Steamers Seafood Bar & Grill, which is located in Bethesda, Md. In its complaint, Joe Hand claimed that Steamers Seafood did not have the requisite consent to televise an Ultimate Fighting Championship event, which included a bout between Quinton "Rampage" Jackson and Brazilian MMA champion Wanderlei Silva. The judge found in Joe Hand's favor, ordering the restaurant to pay $26,500 in damages, the Baltimore Sun reported. That figure does not include the restaurant's costs of mounting a legal defense against Joe Hand.
As the pay-per-view industry puts its foot down against unauthorized public broadcasts, similar cases— and similar results—have become commonplace against bars, restaurants, and other establishment owners across the country.
To avoid getting caught up in a legal battle, you should take the following steps:
- Avoid showing any programming • without proper authorization.
- When presented with the opportunity to show programming, make sure you request back-up documentation that would authorize its display. If such documentation is not made available, refuse to show the program. If documentation is made available, review (or have your lawyer review) the paperwork to make sure that it provides you with all necessary rights to show the desired programs.
- Make sure that you understand all the terms and conditions in the contract for showing the program. These contracts typically include several provisions that could directly affect your bottom line. Such contractual provisions of interest involve: (i) how much you have to pay the program owner for the right to show the event, (ii) when and how often you can show the event, (iii) whether you can record the event for later or repeated showings, and (iv) how you can promote showing the event. Once you have signed the contract for these rights, you must comply with the requirements therein or face legal action for contract breach.
If, for some reason, you find yourself at the wrong end of legal action by a pay-per-view program owner, make sure you:
- Immediately stop any showing and related promotion of the • programming at issue.
- Consult with a lawyer about how to respond to the program owner.
- At a minimum, let the program owner know that you have stopped showing and promoting the programming.