Quartey v. AB Stars Productions, S. A.

260 A.D.2d 39, 697 N.Y.S.2d 280, 1999 N.Y. App. Div. LEXIS 11393
CourtAppellate Division of the Supreme Court of the State of New York
DecidedNovember 9, 1999
StatusPublished
Cited by2 cases

This text of 260 A.D.2d 39 (Quartey v. AB Stars Productions, S. A.) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Quartey v. AB Stars Productions, S. A., 260 A.D.2d 39, 697 N.Y.S.2d 280, 1999 N.Y. App. Div. LEXIS 11393 (N.Y. Ct. App. 1999).

Opinion

OPINION OF THE COURT

Wallach, J.

Some of boxing’s most interesting bouts take place Outside the ring.

Plaintiff Quartey is an erstwhile holder of, and current contender for, the welterweight championship of the World Boxing Association (WBA). Defendant AB Stars Productions is the French prizefight promoter that discovered Quartey in his native Ghana in 1992, and brought him to pugilistic prominence. Plaintiff As ah, a fellow Ghanaian, is Quartey’s manager. Quarte/s early fights were arranged and promoted by AB Stars under an agreement signed in October 1992. The high point of this relationship was when Quartey captured the welterweight crown from then-champion Cristano España in a 1994 bout in France. Plaintiffs thereafter pressed for a more lucrative arrangement, leading to a new promotion contract, signed in February 1996, that contemplated title defenses against such boxing notables as Vince Phillips, Oba Carr, Pernell Whitaker and Oscar de la Hoya.

Seeking a still more lucrative arrangement, plaintiffs then allegedly demanded that defendants Square Ring Productions (a Florida corporation) and New Jersey Sports Productions (doing business as Main Events) be hired as co-promoters. Unlike AB Stars, both of these American promoters are licensed with the New York State Athletic Commission (NYSAC). Plaintiffs further demanded that the site of the Oba Carr fight be switched from France to New York. Faced with the prospect of losing Quartey altogether, AB Stars, without the benefit of [41]*41American counsel, entered into a new agreement with plaintiffs in September 1996, acceding to all of these demands. This latest agreement contemplated a minimum of seven fights worldwide, with net profits to be distributed among the three promoters as follows:

AB Stars New Jersey Sports Square Ring

Fight No. 1 50% 50% —

Fight Nos. 2-3 40% 35% 25%

Fight Nos. 4-7 30% 25% 45%

The New Jersey Sports attorney who drafted the agreement insisted on insertion of a New York “choice of law” clause.

The first bout under this new agreement was Quartey’s successful title defense against Oba Carr at Madison Square Garden in October 1996, for which contest Square Ring was identified with NYSAC as the licensed promoter. Two other bouts took place out of State — a successful title defense in Las Vegas against Ralph Jones, and a draw with Jose Luis Lopez in Connecticut. For these three fights, Quartey received $600,000, $700,000 and $800,000, respectively, plus training expenses and a portion of Square Ring’s promotional revenues.

New Jersey Sports, which also represented Pernell Whitaker, was desirous of promoting a fight between the two, but AB Stars objected when it became clear that it was to be squeezed out of the picture. The Quartey-Whitaker bout became academic when Whitaker failed a drug test. In February 1998, after the attorney representing both Quartey and Square Ring threatened a lawsuit to invalidate the September 1996 agreement, plaintiffs brought this action, alleging that that agreement had been made under duress. A month later, New Jersey Sports entered into a new agreement with Quartey to be the fighter’s sole promoter.

After cancellation of the Whitaker fight, the WBA required Quartey to fight the No. 1 contender, Andre Pestriaev. New Jersey Sports allegedly did its best to frustrate AB Stars’ promotion of that fight, including bidding against AB Stars for the promotion rights, refusing to disclose Quartey’s whereabouts in the period leading up to the scheduled date of the fight, and supporting unsuccessful legal action to force payment in advance to the fighters. AB Stars promoted the fight, scheduled for May 1998, nonetheless, securing an arena in Paris and network television coverage. When Quartey failed to show for that card, the WBA held a hearing and rescheduled [42]*42the fight for August 20. Again, this appearance was allegedly frustrated by a series of maneuvers designed to have New Jersey Sports substituted for AB Stars as the promoter of the fight, culminating in an effort to cancel the bout when it was reported that Quartey had contracted malaria. WBA doctors examined Quartey and concluded that the purported illness was fabricated. The WBA consequently stripped Quartey of his championship title.

New Jersey Sports had by this time negotiated a bout for Quartey against Felix Trinidad. Meanwhile, AB Stars received authorization from Quartey to negotiate a much more lucrative contract to fight Oscar de la Hoya. This was a match long desired by plaintiffs, and they agreed to drop their lawsuit and honor the September 1996 agreement if it came about. But then New Jersey Sports stepped in and secretly signed a contract on Quartey’s behalf with de la Hoya’s promoter, cutting out AB Stars but using all the terms previously negotiated by AB Stars. This way, New Jersey Sports would no longer have to share any promotional revenues with AB Stars. By separate agreement, Quartey agreed with New Jersey Sports to consider invalid any prior contract involving AB Stars, to refrain from engaging in any further deals with AB Stars without the consent of New Jersey Sports, and to continue pursuing its litigation against AB Stars. Thus using plaintiffs as their stalking horse, New Jersey Sports was able to cut AB Stars out of the picture, and at the same time keep that promoter tied up in litigation.

This action seeks a declaration that the September 1996 agreement was void and unenforceable, a preliminary injunction against AB Stars’ assertion of any promotional rights with respect to Quartey, and damages for breach of implied covenant of good faith and fair dealing. Square Ring and New Jersey Sports are listed as “necessary party” defendants. AB Stars counterclaims and cross-claims for breach of contract, quantum meruit, unjust enrichment, constructive trust and declaratory relief, and further counterclaims for declaratory relief, and further cross-claims for interference with business relations, contribution and indemnification. The IAS Court denied AB Stars’ motion for summary judgment validating the September 1996 agreement, for a constructive trust over promotional revenues derived from the de la Hoya fight, and for leave to amend its counter- and cross-pleadings to include damages for two canceled bouts in Europe. Instead, it granted plaintiffs’ cross motion for summary judgment declaring the September 1996 agreement void. AB Stars appeals.

[43]*43New York, by regulation, prohibits anyone from promoting a boxing contest without being licensed for such purpose by NYSAC (19 NYCRR 207.17). All promotion contracts are to be filed with NYSAC within 48 hours of execution, and at least 10 days prior to the contest (19 NYCRR 208.16). Indeed, “[a] 11 parties to any contracts or negotiations pertaining to a contest or exhibition to be held in New York must be licensed by the commission, unless otherwise directed or authorized by the commission.” (19 NYCRR 208.14 [emphasis added].)

The insertion of a New York choice-of-law provision in the September 1996 agreement had no effect whatsoever on fights taking place outside New York State (Zwirn v Galento, 288 NY 428; Gregory v Scorcia, 493 F Supp 984 [SD NY]).1 There is nothing illegal per se about this contract. The fact that co-promoter AB Stars was not licensed in New York did not invalidate those aspects of the September 1996 agreement pertaining to fights in Las Vegas, Connecticut, or anywhere else outside the Empire State.

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Bluebook (online)
260 A.D.2d 39, 697 N.Y.S.2d 280, 1999 N.Y. App. Div. LEXIS 11393, Counsel Stack Legal Research, https://law.counselstack.com/opinion/quartey-v-ab-stars-productions-s-a-nyappdiv-1999.