SHAW FIRES BACK

The Boxing Channel

By Michael Swann

A couple of weeks ago here at 15 Rounds, Robert Morales wrote in his column, “ Being a boxing promoter is a lot like being a politician - you have to be a little dirty to stay in the game. But it is the opinion here that Shaw is a good guy who got the short shrift on this one.”

Morales was referring to the Winky Wright debacle, which we’ll address later. In the meantime, forgive Shaw if you see him slapping his neck repetitively, as a number of poison darts seem to have been directed at him of late, and the same quote that Morales used to describe the Wright situation appears to be applicable here.

Thomas Hauser is one of the finest boxing journalists of our generation, so good in fact, that last year he was presented the prestigious “Nat Fleischer Award” for excellence in journalism by the Boxing Writers Association of America. Last week, Hauser wrote an article for Seconds out.com entitled, “Manny Pacquiao: Where the Money Is Going,” giving a breakdown of the Filipino star’s take home pay and deductions from the second Eric Morales fight.

It has been widely reported that Pacquiao earned a guaranteed minimum of $2 million before pay-per-view income for the fight, and brought home slightly over $300,000. Hauser goes a step farther in his story, divulging the exact dollar amount of the deductions. Hauser reports the money paid out to Pacquiao’s three managers, his trainer, assistant trainer, translator, advances paid by Top Rank and Gary Shaw, payments to the IRS for present and back taxes, payments to Top Rank for tickets to the fight with Morales, payments to Gary Shaw for tickets for Corrales -Castillo III, airfare for his wife and a friend, sanctioning fee, funds withheld by the Nevada State Athletic Commission pending results of Pacquiao’s post fight drug test, purchase of a vehicle, and the fee paid to Gary Shaw Productions. It was also noted that Pacquiao’s three managers, Shelly Finkel, Nick Khan, and Keith Davidson, along with trainer Freddie Roach, deferred a combined $100,000 of their fee in the form of a loan to Pacquiao.

Hauser writes that “Clearly, Shaw negotiated very well for himself… Three promoters with extensive experience at the world championship and pay-per-view levels…would have accepted $100,000 to serve as Pacquiao’s promoter…Among the factors they cited were 1] the bulk of the promotional work was done by Arum; 2] Shaw benefited from the visibility and prestige that came from being Pacquiao’s promoter of record; and 3] many of the chores that Shaw performed on Pacquiao’s behalf…could have been performed by Pacquiao’s co-managers [and in particular by Finkel who has been in boxing for more than two decades.]”

Not unexpectedly, Gary Shaw is perturbed by the undertone of the article, on many levels. He feels that it breached Pacquiao’s privacy, and was meant to taint the reputation of Shelly Finkel for personal reasons. Shaw is also enraged with the three promoters, as well as the Nevada State Athletic Commission.

In an interview with 15 Rounds last week, Shaw was given an opportunity to respond to the article:

“Tom Brown from [promoter Dan] Goossen’s company called the Nevada State Athletic Commission to ask for Pacquiao’s pay out sheet. [The payout sheet lists the deductions from the fighter’s purse so that the commission knows what is actually taken away, supposedly to protect the fighter.] It’s just another case of Goossen and company being lowlifes, but I’ve come to expect that from them. Everything on the sheet is accurate; Hauser’s article is not accurate.”

How is the story not accurate?

“The way it’s written makes it look like Manny didn’t make a lot of money. What Hauser did…and the Nevada State Athletic Commission is unconscionable because there are things that are very personal to Manny.

“I don’t think that anyone’s taxes are anyone’s business. It wasn’t hurtful to me, but I think it was hurtful to Manny, and I think if these guys really cared about the fighters there would have been no reason to put that whole article out.

“What it is is that Hauser has a bone against Shelly Finkel…Everybody in the industry knows that. This was a cheap shot at Shelly through Manny and he didn’t accomplish anything because Manny signed off on everything on that sheet…Manny was read everything in his native tongue as well as in English…item for item.

“Off my fee , I paid for my flights and my staff’s flights. I also paid for the rooms for my staff, and all other charges. I also paid my own travel, hotel and food when I went to see Manny in training camp. The first fight I did with Manny was at Staples [Center] and I [paid the same expenses] and did the same for his media day, [with a considerably lower fee.]”

How about the promoters that said they would accept less to promote Manny?

“Right. That was Cedric Kushner, Goossen, and [a third party that Shaw did not want to go on record because he was unsure of his involvement.] Cedric apologized to me for his comment.

“I called Hauser back and told him to call all the people who said that and tell them that I would do their fighter next time, like James Toney, for $90,000.

“My fee was not outrageous based on over $3 million. It’s about 8%. It’s an ugly business with ugly people like Goossen taking cheap shots for no reason. And Cedric, who is hanging by a thread and is removed from his own company right now, as he told me, from the FCC [SEC actually]. So look who Hauser’s asking.”

But does a fighter need three managers?

“They’re not taking three fees. It’s one fee split three ways, and they haven’t even taken the 20% yet. I’ve seen some [management fees] as high as 33 1/3%.

“But what Hauser isn’t going into is that these guys put up the money and all the work to get him [Pacquiao] away from Murad [Muhammad, Pacquiao’s former promoter] who was ripping him off. What he should have done is written an article that Freddie Roach was the one who brought to the attention of the world that Manny was being ripped off financially. Shelly and that group came to his rescue. How about that story and I’m not sticking up for Shelly or Nick Khan or anyone else. Kahn got on the stand and testified for Manny. They worked for the attorneys - endless hours. I know that because they were in New York, [and] they came and lived here [Shaw’s home in Wayne, New Jersey] for a few weeks.”

Actually I admire Hauser. He’s had a great body of work.

“I know all you guys can write, I understand that. But sometimes there are needless attacks, either on a promoter, a manager, a trainer, a fighter - this is one of those times. He wasn’t educating Manny. He wasn’t proving anything. He didn’t get the goods on Shelly or Nick Khan or Keith Stewart or me. It just didn’t make any sense.”

Is the pay sheet public record?

“Well, I didn’t think it was and it is and I’m going to change the way I do business. I put the Nevada commission on notice. The law of disclosure was meant to help the fighter.

“How do you think Manny feels now? Do you think he wants me to disclose everything? In the future, I’ll put no deductions and after the fight [we’ll write out checks for the deductions.] Before we just deducted it so the commission knew, honestly, what was being deducted from the fighter. I spoke to the commission and they now know what awaits them.

“If Manny wanted to buy a car, that’s no one’s business. Or that I loan him the money or the amount paid for the car.

“So you should take the money for the back taxes, the money he took from Arum, the money he took from me, and the car and the current taxes. You’ll see if you add those back plus the million plus he’s getting for pay-per-view, he earned over $2 million. He never had a purse like that - never.”

Part of the payments that were made to the IRS was for back taxes, a carryover of Pacquiao’s problems with Murad Muhammad. But even just adding the advances, tickets, airfare, money withheld for the drug test, and the vehicle brings his total to almost $750,000, according to this writer’s calculations, with an estimated $1.25 million expected in pay-per-view and additional revenues, very close to $2 million total net. While Pacquiao is still required to pay 20% to the combined management team from the PPV income, still there is no doubt that Pacquiao had never made that much money prior to this event.

Further, according to reliable source information, Goossen and Don King are taking $700,000 of the $2.8 million that James Toney is earning for the Hasim Rahman fight. If Shaw is overpaid at $250,000 on a purse in excess of $3.25 million, then by comparison Toney is either a very bad businessman or a robbery victim.

Hauser writes that “professionals are paid at varying rates. For example, some lawyers are paid at $600 an hour while others charge only a small fraction of that amount. But it should be noted that, prior to Pacquiao’s managerial team, Pacquiao… was already an established star.”

Manny could have purchased any vehicle that he wanted. He chose a Porsche, but he could just as easily have chosen a Ford if that was what he wanted. Would you say that Manny’s selection of a management and promotion team reflects a comparable analogy of capitalism in action?

“He’s getting the best in promotion and management and it shows. Lost the last fight, this one he won handily. Is there a price on Manny walking into that ring mentally free? We took care of everything. Every minute he was on site he knew where he was going and what he was going for. He had a two bedroom suite. He had guards posted outside. He didn’t have problems with tickets, didn’t have a problem with credentials -zero. He walked into the fight ready to fight.”

Any last thoughts on the subject?

“That article was needless and hurtful to the fighter and did nothing to damage Shelly Finkel, the management , or myself. So why do it? I understand that [the article] was supposed to be an expose. Everyone knows he [Hauser] hates Shelly. Where was the revelation there?

“ What other promoter , other than Goossen, would have called the commission and asked for the pay out sheet for a fighter? I’ve been in boxing since 1971 - never saw it, never heard of it. So every time Goossen does a show from now on should I look through his payout sheets?”

Thomas Hauser was contacted as a courtesy to advise him of this article, and he requested an opportunity to respond.

Hauser says that he had called Shaw prior to the publication of his story, and that Shaw knew exactly what he was writing. Hauser says that he asked Shaw for a breakdown of the purse, but Shaw told him that he didn’t want to discuss it. Hauser said that he was merely pointing out in his article that $250,000 is a lot of money , and it was possible that Pacquiao’s managers would have negotiated for less if the fee was coming out of their own pockets instead of Pacquiao’s.

Hauser defended Goossen’s fee for Toney, saying that Goossen built Toney, recycled his career, and had a huge financial investment in him, that has him $1 million in the hole on his investment up to the present.

Hauser suggested that I call Cedric Kushner and ask him myself how much he would accept as a fee for promoting Pacquiao.

Kushner said that he preferred not to comment on the issue, because he felt that Shaw was a promoter and should get paid. He said that promoters provide a service in the fighter’s interests so that they can win.

“When you say that he earned $250,000, to a person reading the article that earns $300 a week that seems like an obscene amount,” Kushner said. “But in multi-million dollar deals to provide a specific service, it’s not a lot of money. The fact that someone is working on a handshake agreement, he should get twice as much, because you can always lose out to the flavor of the month.”

I asked Cedric if he had apologized to Shaw.

“No, because I don’t consider it an apology to tell the truth.”

I called another major promoter who had no connection to the matter, and had not even read the article, and asked his opinion of the $250,000 fee. The promoter told me that it would depend on many variables, such as investment, provisions of the contract for future fights, whether his fighter was being loaned out to another promoter, and several other factors. This promoter said that in some cases the fees could be as high as 20% -30%, depending on the circumstances.

After I described in more detail Gary Shaw’s role in promotional services with Manny Pacquiao for the Morales fight, the promoter termed it, “a tremendous bargain, ” and said that he could not compete with Shaw’s fee.

Just a couple more questions…

What about the Winky Wright situation?

“I’m hired to do one fight for him, and that is the Jermain Taylor fight. After that he will be strictly representing himself. My only comment is that I’m …working as if I had a lifetime contract and do everything to the best of my ability.”

I’ve read that you are a nice guy in a tough business. Is this going to change your past policy of making handshake deals with your fighters?

“Yes, 100%. It’s sad in a way.”

What about the talk about Golden Boy and HBO? Is there going to be litigation?

“Not any longer. [HBO] said that they would not do the fight unless I was the promoter.

“Richard Schaeffer was right there. He’s right in the main end of the problem. He’s hiding behind all kinds of stuff, but believe me, he’s part of the problem. He got his opportunity through a guy with Winky and he persists to do whatever it is that they’re doing.”

As columnist Robert Morales wrote last week, Schaeffer, the CEO of Golden Boy Productions happened to be present when Winky Wright “barged unannounced into the New York City office of Ross Greenburg, president of HBO Sports.”

“I’m really flabbergasted that someone can just walk in to the president of HBO Sports,” Schaeffer said of the supposed lack of security, according to Morales.

The opinion here is that Greenburg, either out of a sense of fair play or fear of litigation saved the Taylor -Wright fight by insisting that Shaw remain as Wright’s promoter for this one last time. Shaw may be a nice guy, but he is far from a pushover.

Furthermore, while Wright deserves the opportunity to control his own destiny and solidify his future with his own promotional company, recent events have demonstrated that he still has much to learn about how to do business. Winky’s promotional company isn’t even licensed yet, and he’s already burning bridges. The only part that he has seemed to have mastered so far is “you have to be a little dirty to stay in the game.”

Meanwhile, Shaw keeps working despite the distractions. He said that he is working to get Vivian Harris a fight with Ricky Hatton, and just last week he signed 24-0 [19] IBF/IBO flyweight titlist Vic “Raging Bull” Darchinyan. Shaw is hopeful of a match with WBC interim champ Jorge Arce for Darchinyan in the near future.