http://www.watchkalibrun.com/2010/6/1/1496241/one-flew-over-the-m-1-nest For those that don't remember Affliction and M-1 entered a co-promotional partnership when Affliction began promoting MMA fights. M-1 just so happens to serve as the legal representation for #1 ranked heavyweight Fedor Emelianenko so any attempt to sign Fedor to a contract requires dealing with M-1 and also having M-1 "co-promote" fights. Long story short, Affliction held two evens, Josh Barnett got busted for 'roids, Affliction folded, M-1 got mad and sued and now Affliction is doing the American thing and countersuing. According to Affliction, the California-based promotion inked a "Fight Agreement" that tendered $300,000 to Emelianenko per bout he participated in, while Affliction was directed to pay the remaining $1.2 million of Emelianenko's $1.5 million asking purse per bout directly to M-1 Global under the auspice of a "Consultation Agreement." "The reason for the two agreements, Affliction was told, was for personal tax implications," reads the countersuit. Affliction claims no consultation was ever agreed upon or given by the M-1 Global group for the two events. "Because the consulting agreement was a sham contract designed to avoid tax obligations, M-1 had no obligations to perform pursuant to the consulting agreement and therefore rendered no performance under the consulting agreement," alleges Affliction's filings. For those that don't read lawyer speak here's the WKR summary of what Affliction is alleging. Fedor wanted $1.5 million but didn't want to pay taxes so $1.2 million was paid to M-1 as a front to avoid taxes. Which he would then reinvest by buying a new "package" from the Greek -- it's in The Wire people! Quick question though, if Affliction is saying that the contract was a sham to avoid taxes aren't both businesses guilty of some kind of corporate fraud? Paging the FBI. Paging the FBI. Per Sherdog, the trial begins in April 2011.
