Finkel, Peterson brothers ready to go their separate ways
A decade ago, brothers Lamont and Anthony Peterson lived on the streets of Washington, D.C. Today, they're considered two of boxing's most promising stars. So why would they want nothing to do with Shelly Finkel, who has co-managed the brothers since day one?
Originally Published: May 29, 2008By Thomas Hauser | Special to ESPN.com
Scott Foster/FightwireLamont Peterson, left, is ready to take his career in a new direction -- without the help of Shelly Finkel.Over the years, Shelly Finkel has represented numerous champions. He has been with some of them from the beginning of their pro careers; with others, including Mike Tyson and brothers Vitali and Wladimir Klitschko, he became involved after they were already established stars. He's boxing's version of Talleyrand, the French diplomat who served in virtually every era from Louis XVI through the Reign of Terror to the rise and fall of Napoleon Bonaparte and the Restoration. Now, Finkel is at odds with Lamont and Anthony Peterson, two fighters he has co-managed since the inception of their professional careers. On April 30, the Petersons sent letters to Finkel terminating their relationship with him. They now claim that Finkel has defrauded them out of hundreds of thousands of dollars. Finkel's proponents say he's a shrewd businessman who engineers deals in good faith that result in large sums of money being paid to his fighters. Shelly's detractors have a different view. Don King, who has had his own issues with fighters, says, "Anyone who tries to deal in good faith with Shelly Finkel winds up getting 'Finkeled.' And that's not good. Finkeling is much worse than tinkling. It's hard to explain to someone who has never been Finkeled what the experience is like. He does it with words, but words fail to describe it." Everyone agrees that, as a manager, Finkel has a fiduciary obligation to his fighters. That's a different set of responsibilities than those of a promoter, whose job entails giving as little money as possible to fighters so he can keep as much money as possible for himself. A decade ago, Lamont and Anthony Peterson were homeless, sleeping in abandoned automobiles on the streets of Washington, D.C. Then Barry Hunter, the owner of a local construction company, and his wife took them in. Hunter also taught the brothers how to box. The Petersons are now recognized as having championship potential. Lamont is a 24-year-old junior welterweight with a 24-0 record, including 11 knockouts. Anthony, 23, is a lightweight whose ledger stands at 26-0 with 19 KO's. The Petersons met Finkel in March 2003 at the U.S. National Amateur Championships. In July 2004, they signed boxer-manager contracts with him. Each fighter received a $21,000 signing bonus that was paid out over 12 months. At the request of the brothers, Finkel agreed to split his 30 percent managerial fee equally with Hunter, who became their co-manager. At Finkel's urging, the Petersons signed bout agreements on a fight-by-fight basis with Prize Fight Promotions, a Tennessee company headed by Brian Young. Between 2004 and 2007, Prize Fight promoted approximately 20 fights for each of them. Last month, the Petersons signed promotional contracts with Top Rank over the objection of Finkel, who was negotiating to sign them with Golden Boy. In response, on April 18, Finkel filed an arbitration proceeding against the brothers. Hunter was also named as a respondent in the proceeding. Finkel's claim alleges the Petersons and Hunter breached the provisions of the fighters' managerial agreements when they retained Jeff Fried, a Washington, D.C., attorney, to negotiate a boxing promotion agreement with Top Rank on the Peterson's behalf without Finkel's consent. Finkel claims no such promotional agreement can be entered into without his consent and that the Petersons and Hunter have attempted to "freeze out" Finkel from the Petersons' boxing career in violation of his rights as a co-manager. Finkel seeks $300,000 in damages, the award of attorney fees and injunctive relief.
These are two kids who didn't even make the Olympic team, and they're way ahead of the kids who beat them in the Olympic trials. I feel like I've done a phenomenal job with them. I always did what was best for them, and then they decided they can do without me.
-- Shelly Finkel
The letter, which is attached to the Petersons' counterclaim as Exhibit A, is dated Oct. 15, 2004, written on Shelly Finkel Management stationery, addressed to Michael Lampley of Prize Fight promotions, and signed by Finkel. The handwritten letter states, "Hi Michael, I want to follow up on your letter regarding the 2004 amateurs, a recap of our agreement, and where we are at present. Originally, we were supposed to be funded with $500,000 for the recruiting and signing of the best 2004 Olympians and amateurs. Instead, we ended up being financed for $425,000 of which $25,000 went to [name illegible]. The status of the individual fighters is as follows: Lamont and Anthony Peterson -- They are going to be exclusively with Prizefight Promotions as we discussed. I believe that one or both of the brothers are going to put Prizefight Promotions on the map and, with a little luck, we will recoup all of your investment from them." Six other fighters were listed in the letter. None of them signed with Prize Fight. When the Petersons and Hunter learned about the letter, they weren't sure what it meant or what to do. Hunter says he tried repeatedly to arrange for a conference call between himself, the Petersons, Finkel and representatives of Prize Fight. The counterclaim alleges, "Finkel agreed but avoided causing the call to take place." Then Finkel began urging the brothers to leave Prize Fight and sign a promotional contract with Golden Boy. Finally, in the spring of 2008, the Petersons retained Fried to represent their interests. "Anthony and Lamont came to me and said, 'All along, Shelly has been telling us we should be with Prize Fight,'" Fried says. "'Now he's telling us, 'Golden Boy, Golden Boy.' And we don't understand about the $425,000. What should we do?'" Fried and the Petersons decided that their approach should be: Don't get even, get ahead. Let's decide who's the best promoter for this situation. Thereafter, Fried sent identical proposals for the Petersons' services to Bob Arum at Top Rank and Richard Schaefer at Golden Boy. Arum telephoned the day he received the proposal and made a good offer, according to Fried, while Schaefer took several days to respond. Then, he telephoned Fried and said, "They can spar with Oscar [De La Hoya] and Golden Boy will put them on the De La Hoya-Forbes undercard." But the offer that Schaefer ultimately made was much less appealing than Arum's. And as Fried later observed, "Lamont and Anthony want to be world champions, not sparring partners for Oscar De La Hoya." In mid-April, the Petersons went to Fried's office for conference calls with Arum and Schaefer. "It was important to me that they speak directly to both promoters," Fried says. "I wanted them to hear directly from each guy what the offers were. After the conference calls, they told me that they absolutely wanted to go with Arum. The decision was totally theirs. Lamont called Schaefer and told him that day. Richard was professional and gracious about it. Shelly responded in a different way." "Lamont and Anthony didn't want to act against Finkel," Fried continued. "They wanted to move on. They're more comfortable in a gym than in a lawyer's office. But once Shelly filed for arbitration, they had no choice." The counterclaim also states that the Petersons signed their managerial contracts with Finkel without legal advice and without any review on their behalf by an attorney. It notes that, by virtue of his position as their manager, "Finkel incurred a fiduciary duty to act solely in their best interests and therefore owed them a duty of utmost fidelity, transparency, and honesty in all of his dealings with them." It then claims, "Finkel egregiously violated his fiduciary duty engaged in illegal and unconscionable conduct including but not limited to fraud, breach of fiduciary duty, and violation of the Muhammad Ali Act," and he was terminated by the Petersons as their manager because of his "outrageous, disloyal, and illegal actions." More specifically, the Petersons' arbitration filing alleges: • "Finkel entered into a secret agreement whereby he was paid approximately $400,000 in return for obtaining exclusive promotional rights to counterclaimants [for] Prize Fight Promotions without advising counterclaimants or their co-manager of his arrangement and, indeed, concealing it from them." • "Anthony and Lamont knew nothing about Finkel's arrangement, were not told about it until years after the management agreements were executed, and received no part of the consideration paid to Finkel. When eventually confronted with the facts regarding his breach of fiduciary duty and the Muhammad Ali Act, Finkel lied to the Petersons and claimed that the monies received by him were unrelated to the Petersons." • "Finkel insisted, against [the Petersons'] best interests and for his own purposes, on steering them to Golden Boy. In late 2007 and early 2008, when it became clear that counterclaimants' careers would be furthered by association with a prominent promoter, Finkel declined to seek out the best promotional arrangement for counterclaimants and, instead, endeavored to persuade counterclaimants to deal only with Finkel's favored promoter [Golden Boy], whose offer was inferior and who was touted by Finkel for Finkel's personal benefit and not in the best interests of counterclaimants." When asked about the counterclaim, Finkel said that in 2003 he entered into an agreement with a Tennessee investment group called AMP Entertainment. The signatories to that deal were Finkel and, on behalf of AMP, Mike Lampley (who is also an equity participant in Prize Fight) and a third person named Don Mercer. Finkel said, "AMP agreed to fund me with up to $500,000 to scout and build relationships with kids who were hoping to be on the 2004 U.S. Olympic team. The $425,000 was reimbursement for my expenses. The deal was, if any of these kids made the team and signed with me when they turned pro, I would then go to promoters and tell them that AMP was interested in becoming involved. And if the promoter that the kids and I chose wanted AMP to be involved, AMP would put up all of the signing bonuses that the promoter paid to the fighter in exchange for AMP receiving 50 percent of the promotional profits. There was never a deal between me and Prize Fight. I had a deal with AMP. The $425,000 came from AMP. And if a future promoter didn't want AMP to be involved, then there was no further obligation to AMP." Finkel said there is documentary evidence that supports his position, but declined to make the documents available to ESPN.com. Whatever deal might have existed between Finkel and AMP, counsel for the Petersons can be expected to make the following points: • The Oct. 15, 2004, letter from Finkel to Lampley was addressed to Mike Lampley at Prize Fight, not AMP Entertainment. • Finkel said in an interview with ESPN.com that the 2003 AMP agreement was limited to 2004 Olympians. The October 15, 2004, letter was written well after the 2004 Olympics, when it was clear that neither Peterson had made the 2004 U.S. Olympic team. • Finkel, as co-manager, paid $21,000 signing bonuses to Lamont and Anthony Peterson, but they never signed a long-term agreement with Prize Fight. Thus, even if the Petersons had been covered by the AMP agreement, there was no promoter's signing bonus for AMP to pay and AMP had no interest in the promotional profits from their fights. The Petersons' case is reminiscent of litigation that resulted from a $1.925 million "packaging fee" that Finkel received from Showtime in conjunction with his representation of Juan Diaz, Rocky Juarez, Jeff Lacy and Francisco Bojado after the 2000 Olympics. That matter was quietly settled. This case might not go away so quietly, and the impact could be far-reaching. During an April 4, 2007, conference call, Richard Schaefer introduced Juarez, who was fighting on the De La Hoya-Floyd Mayweather undercard, and told the world, "Before I turn it over to Rocky, I would like to mention as well Rocky's manager, Shelly Finkel. This is the first fighter Golden Boy is signing with Shelly. And I'm really happy with the relationship over the past months that I was able to develop with Shelly. It's a pleasure to work with Shelly. And I really appreciate the friendship and strategic alliance we have formed with Shelly." When asked last week about his relationship with Golden Boy, Finkel said, "By my nature, I usually work with one promoter at a time. First it was Main Events. Then it was Gary Shaw. Right now, I'm bringing a group of young fighters to Golden Boy. But I've made no promise of exclusivity to anyone. Golden Boy has not reimbursed me for any expenses or paid one penny to me in conjunction with any of the fighters I represent except for my managerial fee, which is deducted from each fighter's purse and paid directly to me by Golden Boy. Each fighter is fully aware of what that fee is." Meanwhile, Hunter wants the boxing community to know, "I'm just happy that Lamont and Anthony are happy. They have a good promoter now, and I hope they get everything they deserve." As for the Petersons themselves, Lamont says, "It's hard to put into words what I'm feeling. I feel betrayed. I feel used. We trusted Shelly. He was our manager. He was supposed to get the best opportunities for us, not for him. Shelly keeps saying he loves us, he loves us. And look what he does. Now I know." Thomas Hauser is the lead writer for Secondsout.com. His most recent collection of boxing columns -- "The Greatest Sport of All" -- has been published by the University of Arkansas Press. He can be reached by e-mail at firstname.lastname@example.org.
Andy Lyons/Getty ImagesRock Allen, right, defeated Lamont Peterson for a spot on the 2004 U.S. Olympic boxing team. Still, Peterson has been on a faster track toward a title than Allen has.