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SBJ/March 3 - 9, 2003/Labor Agents
Same players, different field for Steinberg-Dunn
Published March 3, 2003
The Steinberg vs. Dunn battle isn't over. It's just moved to U.S. Bankruptcy Court.
Sports agency Steinberg, Moorad & Dunn intends to collect on its $4.66 million judgment against former partner David Dunn, despite the agent's filing for Chapter 11 bankruptcy protection last month.
"We will take the position that his obligations as a result of the judgment are not dischargeable," said Kent Roger, an attorney for Steinberg, Moorad & Dunn.
Roger said a provision in the bankruptcy code prohibits a debtor from discharging debts resulting from "a willful and malicious injury by the debtor to another entity or to the property of another entity."
Mark Humenik, attorney for Dunn's firm, Athletes First, said, "I do not agree with Mr. Roger that the award against Dave is non-dischargeable."
In November, a federal jury in Los Angeles found that Dunn and Athletes First acted with fraud, malice or oppression after Dunn left Steinberg, Moorad & Dunn in February 2001, taking 50 clients and five employees and forming a rival firm.
The jury ordered Dunn to pay $2 million in compensatory damages and $2.66 million in punitive damages. Athletes First was ordered to pay $20 million in compensatory damages and $20 million in punitive damages.
Kenneth Klee, a bankruptcy attorney and UCLA law school professor, said it is possible, but difficult to prove, that court judgments are exempt from being discharged in bankruptcy. "The debtor's discharge is somewhat protected," he said.
Klee said Steinberg's lawyers may have other options. "They might try to dismiss the case as a bad-faith filing," Klee said. Courts have dismissed bankruptcy filings when it is proved that a debtor is trying to avoid one particular creditor, he said.
Meanwhile, Steinberg's firm filed a notice in Bankruptcy Court claiming a secured interest in all fees Dunn collects for negotiating player contracts. Dunn represents about 50 NFL players and several draft prospects, including expected No. 1 pick Carson Palmer.
PORTIS SIGNS COKE DEAL: Denver Broncos running back Clinton Portis signed a multiyear deal to be a spokesman for the Coca-Cola Co.
"They have the rights to use him in Colorado, Wyoming, Kansas and New Mexico," said Jonathan Wexler, Portis' marketing agent. Wexler, vice president of Playing Field Promotions of Denver, wouldn't reveal the financial details of the deal.
Coca-Cola marketing executives are interested "in using [Portis] in print, billboard and point-of-sale advertising," Wexler said. "He will also be making a series of appearances."
EDGE SIGNS NBA PROSPECT: Edge Sports International signed 7-foot center Zoltan Bencze, a player on the professional Hungarian team Albacomp, for representation in the NBA draft.
Keith Kreiter, Edge Sports president, will represent Bencze with Alex Saratsis, Edge Sports director of international relations.
Saratsis, who speaks Spanish, Italian, Japanese and Greek in addition to English, was hired in August to help sign international players.
DONOVAN INKS GATORADE DEAL: U.S. men's national soccer team and San Jose Earthquakes forward Landon Donovan signed a four-year endorsement deal with Gatorade.
Financial details were not released.
Richard Motzkin, principal and founder of SportsNet LLC, a Los Angeles agency specializing in soccer players, represented Donovan in the negotiations.
Contact Liz Mullen with labor and agent news, tips and anecdotes at firstname.lastname@example.org.