The story has just been reported through various blogs and on-line news that Mayweather called Pacquiao to agree to fight.  A verbal agreement to fight is great, but if no one is negotiating then the details of a fight are still left blank.  Bob Arum will not negotiate because he wants a few more fights under his promotion contract with Pacquiao.  So what needs to be done?  Someone needs to negotiate.

First, there needs to be a cleaning of house.  There is the law suit between Pacquiao and Mayweather.  Defamation law suits usually mean that that somethings has been said or done that will hurt the earning power of the person being talked about.  However, in Pacquiao's case earning power has gone up, not down.  End the law suit and move on.  Your just waisting dollars on attorney fees.  Now the issue that is outstanding is conflict of interest.  The same law firm that represents Top Ran and Bob Arum now represent Manny Pacquiao.  Who doesn't want the fight to happen?  Bob Arum.  Who has controls over a law suit that is still pending and stopping a fight.  Bob Arum.  So you need to clean the house of law suits and get to a point where that is out of the way.  Plus, the law firm needs to be dismissed because a legal entity should never be representing both boxer and promotor.  If you read the Federal Boxing laws of the United States it clearly states there needs to be an arms length relationship and no financial ties should hold the boxer to the promoter.  Conflict of interest and financial ties have to be severed to bring the boxer to a solid financial place and be independent.

Second, someone needs to negotiate that knows what they are doing.  Parties from both sides need to sit down quickly and start laying out the bout agreements, bout monies, logistics of the fight, and HBO pay per view agreements, sponsorship agreements and the list goes on.  And the negotiator needs to be independent from Top Rank that represents Pacquiao.  The negotiator has to be involved in every aspect of all agreements, including HBO.  Vital - independent negotiator that can pull all sides together.  In every business you have to have in place a good negotiator or else no deal.  Just good business practice.

Third, what has happened in the past has to end.  So much has been said and promoted.  Many things have been done and said so that the fight could not go forward.  But, if we are reading correctly it now appears Mayweather has reached out to Pacquiao and both have agreed to fight.  Again, if no one is negotiating there still is no fight.  So everyone needs to stop talking and someone needs to step up and do something.  Get out of ring side and go into the ring and negotiate.  If you have a good negotiator and a strong independent team of attorney's and accountants, everything can be done quickly.  But if you have someone in the background going behind everyone's back to stop the talks, then you will have a legal challenge. 

Let's negotiate.  That is how a clean fight is done and how a good business is run.

The U.S. Tax Court ruled against South African golfer Retief Goosen in a case last week involving the two-time U.S. Open champion’s royalty income, disagreeing with his claim that only 7 percent of it came from U.S. sources.

Goosen had endorsement agreements with a variety of sponsors, including Acushnet, TaylorMade, Izod, Upper Deck, Electronic Arts and Rolex. They were allowed to use his name, face and likeness in advertising and marketing campaigns worldwide, and he was paid a base endorsement fee by all the sponsors.

Acushnet, TaylorMade and Izod also pro-rated the base endorsement fee if he did not annually play in a specific number of golf tournaments, the court noted. The three companies also paid him a bonus if he achieved a specific finish in a PGA or European Tour tournament, or reached a specific spot on the World Golf Rankings.

Goosen characterized the endorsement fees and bonuses from Acushnet, TaylorMade and Izod as 50 percent services income and 50 percent royalty income on his nonresident federal income tax returns for 2002 and 2003. The endorsement fees from Upper Deck, Electronic Arts and Rolex were characterized as 100 percent royalty income.

The golfer reported approximately 7 percent of the total endorsement income as U.S. source income. The IRS, however, determined that he should have characterized the endorsement fees and bonuses from Acushnet, TaylorMade and Izod as 100 percent personal services income. The IRS also re-allocated a larger percentage of his endorsement fees as U.S. source income.

The Tax Court ruled on June 9 that the endorsement fees and bonuses Goosen had received from Acushnet, TaylorMade and Izod should be allocated 50 percent to personal services income and 50 percent to royalty income, and that the royalty income he had received from Acushnet, TaylorMade and Izod was 50 percent U.S.-source income effectively connected with a U.S. trade or business. The court also held that the royalty income he had received from Rolex was 50 percent U.S.-source income not effectively connected with a U.S. trade or business.

However, the royalty income he had received from Upper Deck was considered by the court to be 92 percent U.S.- source income not effectively connected with a U.S. trade or business. In addition, the royalty he received from Electronic Arts was deemed 70 percent U.S.-source income not effectively connected with a U.S. trade or business.

On top of that, the court ruled that Goosen should not benefit from any provision under either the 1975 or the 2001 income tax treaty between the United States and the United Kingdom.

The problem with boxing is that Promoters and Managers make up their own rules as they go along that affect the Boxer. However, there are federal and state laws that protect the boxer from the Promoter and Manager. But you will never hear anything about them because probably they don't want you to know. In boxing it is all about how the Promoter can control the boxer and the boxer gets sucked in because there is a lot of money being thrown around.
 
The Muhammad Ali Boxing Reform Act is a federal law enacted in the United States that provides for various legal protections to boxers as well as assisting states in regulating boxing as a sport. The legistlation was enacted due to boxing's unique position in American sports, not having any organized league or rule-making body to ensure appropriate business practices, and due to the lact of protection offered to boxers from the various sanctioning bodies (e.g., the WBO, WBC, IBF and others).

In general, the act restricts the types of contract that a boxer may be required to sign in order to box at an event. The boxer cannot, for example, be required to give away future promotional rights as a requirement of competing in a fight that is a mandatory bout under the rules of a sanctioning organization. The act alwo requires sanctioning bodies to reveal to state commissions various information about matches that are held, fees charged to boxers for the sanctioning body to sanction a match, as well as any payment or compensation received from the body for affiliating itself with the promoter. It also requires promoters to disclose a large amount of the financial information about bouts to the state commissions, as well as to the boxers they promote.

Make sure that your Attorney and your Accountant know the federal law that governs boxing, make sure they know the State rules that follow the federal law. It is important that your Legal and Accounting team know these rules so that they can protect you from Promoters that have their own agenda that benefits them. 

If your legal and accounting team do not know the law then it is time to find ones that do. This is vital for the financial and legal stability of the boxer. You take control, there are rules to protect you.

If you would like to know more about H.R. 1832 - Muhammad Ali Boxing Reform Act. just send me an e-mail at mlodge@vqrginc.com and I will send you a copy.