SBJ/September 28 - October 4, 1998/No Topic Name
King-Tyson purse deal to be probed
Published September 28, 1998
A member of the Nevada Athletic Commission says the sanctioning organization will look into an allegation that Don King Productions Inc. violated Nevada law by taking a 30 percent cut of Mike Tyson's $30 million purse in his last fight.
It is a misdemeanor for a boxing promoter to take any portion of a boxer's purse under Nevada law, said Donald H. Haight, Nevada chief deputy attorney general. Although a manager may receive up to 33 percent of a boxer's purse, the promoter receives the profits from a fight after expenses, including boxers' purses, are paid, he said.
Commissioner Lorenzo Fertitta said the panel would look into the allegation, which surfaced as Tyson sought to have his boxing license reinstated.
Don King was the promoter of the infamous Tyson-Evander Holyfield rematch in June 1997 that was stopped after Tyson bit Holyfield's ears.
At a Sept. 19 hearing on whether Tyson should regain his license, the boxer's new attorneys presented a pie chart that showed that King received $9 million, or 30 percent, of the $30 million purse. Tyson received $5.2 million, or 17 percent, and the rest paid Tyson's managers, taxes, expenses and a $3 million fine imposed by the Nevada commission on the fighter for the biting incident.
Fertitta was among several commissioners who expressed concern over the allegation. Haight indicated the commission would likely have a hearing on the matter after the group decides whether to give Tyson his license back.
Meanwhile, Tyson attorney Dale Kinsella said he would be "thrilled" if the commission conducts a hearing and orders King to give Tyson some of the purse money.
But Kinsella, one of Tyson's attorneys in a $100 million civil lawsuit against Don King Productions over money allegedly owed Tyson, added that he did not know whether the Nevada Athletic Commission was empowered to return the money to the boxer.
Haight said he did not know if that was a legal option, but said the commission could take action against King's license.
Not only did King get $9 million of the Tyson-Holyfield rematch purse, but the promoter also took a percentage of Tyson's purses in 1995, 1996 and 1997, Kinsella said. "The total is in excess of $45 million."
In addition to making statements and presenting the pie chart at the hearing, Tyson's new attorneys presented the commission with a December 1995 contract on Don King Productions letterhead. That contract, signed by King and Tyson, states that Tyson agreed to transfer 30 percent of all purses to Don King Productions. The contract was not filed with the Nevada Athletic Commission until prior to the relicensing hearing, said Tyson's attorneys.
The allegation that King took a cut of Tyson's purses was first made in the lawsuit Tyson filed against the promoter in March in U.S. District Court in New York, Kinsella said.
Although the allegations were widely reported, many of the commissioners expressed surprise when they heard that King had allegedly taken some of the purse money.
Commissioner Luther Mack said it was the first time he had heard it, and added that the commission may hold a hearing on boxers' contracts in general.
Asked specifically if he wanted the Nevada attorney general's office to investigate the allegation that King took part of Tyson's purses, Mack said: "I want them to look into anything that might violate Nevada law."
"We are not happy about [the allegation]," Fertitta said. If the boxer is relicensed, "going forward, all of Mike Tyson's contracts have to be filed with us," he said.
Repeated attempts to reach Don King or his representatives for comment were unsuccessful.