What went wrong between Canelo Alvarez, Oscar De La Hoya and DAZN?

Boxing

On Tuesday, Canelo Alvarez filed a lawsuit against his promoter, Golden Boy Promotions, and his broadcast partner, DAZN, alleging breach of contract and seeking a minimum of $280 million in damages.

Two years ago, Alvarez and DAZN agreed to the richest deal in boxing history. Alvarez would fight on DAZN for his next 11 fights at a price of $365 million. All parties involved have had a variety of disagreements since that time, specifically in terms of potential opponents and payments for upcoming bouts.

Alvarez wants his contract to hold as-is, meaning he will get paid his full amount per fight, which has been a point of contention between the parties, and he’ll get to have final say on his opponents. Until those aspects are worked out, the sport’s biggest star — who is in his prime — will likely be sidelined.

Here’s what we know about Alvarez’s situation and what it means for all involved.

What’s the timeline of this partnership, and how did it fall apart?

Fresh off his decision victory over Gennadiy Golovkin in their rematch on Sept. 15. 2018, Alvarez signed the 11-fight, $365 million deal with DAZN. This union carried benefits for both Alvarez and DAZN. HBO, Alvarez’s former broadcast home, was leaving the boxing business at the end of the year, and DAZN, which had just begun operations in the U.S., needed a marquee star to anchor its boxing franchise.

As it began operations, DAZN produced ads featuring Alvarez and built out the rest of its roster. The streaming service promised to shift the way boxing was consumed by the masses — it would bring the stars of the sport to its platform for a monthly fee, not pay-per-view.

After beating Rocky Fielding in December 2018 to become a three-division world titlist in his first bout of the contract, Alvarez then faced Daniel Jacobs, who at the time was the IBF middleweight titlist and considered among the elite fighters at 160.

After that fight in May 2019, things started to sour.

A representative of DAZN told ESPN before the lawsuit was filed that the company believed it would be getting the third chapter of the Canelo-GGG rivalry during Mexican Independence Day weekend in September, a traditional boxing spotlight. They had fought on this weekend in both 2017 and 2018 with both pay-per-view events producing more than a million buys each (1.3M and 1.1M, respectively). For DAZN, this was going to be a tentpole event that would be key to fortifying its subscriber base.

While Golden Boy and DAZN were on board with the plan, it seemed that Alvarez was either not interested in completing the trilogy against Golovkin or, as the lawsuit states, was simply in the dark.

Last summer was a tumultuous one between Golden Boy and its prized client. There was open disdain from Alvarez toward Oscar De La Hoya, founder of GBP, for what Alvarez perceived to be De La Hoya making promises to DAZN without his consent.

Golovkin also signed an exclusive multi-fight deal with DAZN in March 2019, doing so with a belief that he would be facing Alvarez for a third time that September.

Eventually, the September date passed without a fight being made, and Alvarez faced WBO light heavyweight world titlist Sergey Kovalev in November instead.

Alvarez hasn’t fought since then. Though multiple opponents were rumored for a fight in September, nothing materialized.


Why is Alvarez suing DAZN and Golden Boy?

Alvarez wants the money he expected to earn when he signed the contract. He is not willing to give a discount.

When it comes to Golden Boy, it’s a bit more complicated. While the promoter helped secure Alvarez’s lucrative deal with DAZN, the details of that contract have caused this strain. What was actually promised by Golden Boy to the streaming platform? And was it with the knowledge of Alvarez?

“Both Canelo and DAZN have issues with Golden Boy. Canelo is saying, ‘It sounds like you made a representation to DAZN that I was going to do things that are not in my contract with you — and I’m not required to do them,'” a source aware of the negotiations regarding Canelo’s upcoming opponents told ESPN. “DAZN, on the other hand, is saying to Golden Boy, ‘You had represented to us you had secured Canelo’s approval and agreement to do these things — and you didn’t.'”

The other challenge in terms of Alvarez getting paid is that the pandemic has caused fights to take place without fans in the arena. The gate has always been huge for Alvarez, and most top-tier boxers make significant money specifically from those in attendance. According to the Nevada Sports Athletic Commission, both Canelo-GGG fights made at least $24 million from the gate.


What is Alvarez looking to get from this lawsuit?

Judging by his complaint, it’s clear he wants his money and/or his release from both Golden Boy and DAZN.

As it relates to DAZN, if it isn’t willing to pay the amount that was agreed upon, Alvarez believes that’s a breach of contract, according to the lawsuit. If his release is granted, he would be the most sought after free agent the sport has seen in years.

Alvarez’s current deal provides the greatest safety net possible. In a pay-per-view event, the financial success can fluctuate depending on the quality of the opponent in the fight. But under the DAZN contract, Alvarez is guaranteed a certain amount every fight.

The legal filing states that under the deal, DAZN would provide Golden Boy Promotions with a $40 million license fee for 10 of Alvarez’s fights from 2019 to 2023, with about $35 million going to Alvarez. To put this into perspective, for a pay-per-view event to generate $40 million in revenue to the promoter, it would have to procure 1 million buys at $80 apiece. Pay-per-view revenue is usually split roughly 50-50 between the promoters and the cable and satellite industry.

While Alvarez’s fights against Golovkin and Julio Cesar Chavez were in the million-buy range, his bouts against Liam Smith (300,000 buys) and Amir Khan (600,000) reportedly fell far short of that landmark. Alvarez’s fight against Miguel Cotto for the middleweight championship produced in the neighborhood of 900,000 buys.


What would it take for Alvarez to agree to a fight with DAZN and Golden Boy?

According to multiple sources, Alvarez wants his contract to be executed as intended. For him to face a top-tier opponent — Callum Smith or Billy Joe Saunders — Alvarez would require the amount that was agreed upon in 2018. But while he faced Jacobs and Kovalev last year — two well-known and accomplished professionals in title fights — and was named the 2019 ESPN fighter of the year for his efforts, those bouts may have not moved the needle nearly enough for DAZN’s liking.

A source familiar with Alvarez’s relationship with DAZN told ESPN in July that “officials at DAZN have grown increasingly frustrated with the matchups that have been formulated for Alvarez. While the likes of Jacobs and Kovalev are certainly solid, they didn’t have the type of impact that a third go-around with Golovkin would have produced for the streaming service.”

If DAZN doesn’t get the third fight between Alvarez and Golovkin, would the streaming service want Alvarez to walk away from what it might consider an underperforming contract?


Will Canelo make his WBC mandatory middleweight title defense?

On Thursday, the WBC ordered a purse bid for Alvarez’s mandatory middleweight title defense against Avni Yildirim, a fight that the organization had ordered in August.

If the fighters and their promoters don’t reach an agreement before the Sept. 21 deadline, any promoter can make a bid for the fight. That includes the fighters’ promoters, Golden Boy and Arena Box Promotions, as well as Bob Arum’s Top Rank, Eddie Hearn’s Matchroom Boxing, Frank Warren’s Queensberry Promotions, Mayweather Promotions, Tom Brown’s TGB promotions or any other promoter.

With Canelo in litigation with DAZN and Golden Boy, it’s questionable if any promoter is willing to take a risk on a fight that might never happen, at least until the lawsuit is decided.

ESPN Deportes’ boxing writer Salvador Rodriguez contributed to this report.

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