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Schulz v. U.S. Boxing Ass'n

January 24, 1997

AXEL SCHULZ; CEDRIC KUSHNER PROMOTIONS, LTD.; DER FIRMER SAUERLAND PROMOTION, A.G.; WILFRIED SAUERLAND

v.

UNITED STATES BOXING ASSOCIATION; INTERNATIONAL BOXING FEDERATION, A DIVISION THEREOF; FRANCOIS BOTHA; MICHAEL MOORER, FRANCOIS BOTHA, APPELLANT IN 96-5200 UNITED STATES BOXING ASSOCIATION AND INTERNATIONAL BOXING FEDERATION, APPELLANT IN 96-5239



On Appeal from an Order of the United States District Court for the District of New Jersey Granting a Preliminary Injunction D.C. No. 96-1076

Before: SCIRICA and COWEN, Circuit Judges, and POLLAK, District Judge *fn*

POLLAK, District Judge.

Argued October 30, 1996

Filed January 24, 1997)

OPINION OF THE COURT

This case involves a court's authority to order a private organization that sponsors prizefights to strip a champion of his title. Defendant Francois Botha defeated plaintiff Axel Schulz in a fight for the International Boxing Federation (IBF) heavyweight championship. Botha then tested positive for use of steroids. After a hearing, the IBF declined to disqualify Botha, allowing him to retain his IBF crown. Schulz sued and the district court issued a preliminary injunction mandating that the IBF disqualify Botha. Botha, the IBF, and the IBF's parent United States Boxing Association (USBA) now appeal the grant of the preliminary injunction.

I. Background

Three major bodies regulate and promote the sport of professional boxing: the World Boxing Association, the World Boxing Council, and the International Boxing Federation with its parent United States Boxing Association. Each of these organizations classifies boxers by weight class, ranks the boxers within each class, and, for a participation fee, sponsors -- or "sanctions" -- both championship and non-championship bouts. The IBF was formed to provide a mechanism through which the United States Boxing Association, a national organization, could crown world champions. According to its literature, the IBF was organized "by representatives of various athletic commissions and other interested persons for the purpose of obtaining greater efficiency and uniformity in the supervision of professional boxing and to encourage and assist professional boxing." App. 274.

The IBF has promulgated a set of rules and regulations governing IBF-sanctioned bouts. Rule 20, entitled "Anti-doping," requires boxers to provide a urine specimen after each fight to be tested for, among other substances, anabolic steroids and pain killers. This rule adds that "[s]hould that specimen prove positive, disciplinary action will follow." App. 284. In addition, Rule 26, entitled "Penalties," provides as follows: Should anyone be found in violation of the rules and regulations of the IBF or USBA by any Committees impaneled by the President, they may be subject to fine, forfeiture of monies, vacation of title or any other discipline directed by the Committee and approved by the President for the good of the organization. App. 291.

On December 9, 1995, Francois Botha of South Africa fought Axel Schulz of Germany in Stuttgart for the vacant IBF heavyweight championship. Before the bout, each fighter paid the IBF more than $45,000 in "sanctioning fees" and other fees. Each boxer's representative also signed a document entitled "Rules for IBF/USBA & Intercontinental Championship Bouts" ("Bout Rules"). The Bout Rules were also signed by Robert W. Lee, president of the IBF/USBA, and by a representative of the local boxing commission, the German Boxing Federation. The Bout Rules begin by stating that "[t]he Championship fight will be governed by the rules and regulations of the IBF/USBA and local Boxing Commission . . . ." App. 83. The Bout Rules then set out four pages of detailed requirements. The last of these is entitled "Anti-Doping" and reads as follows:

Each boxer is required to take a urinalysis immediately following the bout. Said specimen must be taken with a Ringside Physician and Commission Inspector on hand. The specimens should be taken in a plastic container and properly marked by the physician and boxer. It should be divided into two parts for each boxer, with bottles [sic] #1 being submitted to the laboratory. Should either boxer's specimen be positive for drugs, etc., all parties will be notified and another test made at a laboratory selected by the boxer and the local Commission. Should that specimen prove positive, disqualification and disciplinary action will follow. Specimens will be tested for the following drugs:

There follows a list that includes anabolic steroids and pain killers. App. 87.

An identical "Anti-doping" rule appears in an IBF/USBA document titled "Ring Officials Guide and Medical Seminar Outline." This Guide's introduction states that "[t]he major purpose of this Ring Officials Guide is to establish criteria to be followed in all IBF/USBA boxing matches so that uniformity in actions, responsibilities, duties and total performance of ring Officials can be attained . . . ." App. 65.

In the Stuttgart fight, Botha defeated Schulz in a split decision to win the IBF heavyweight championship. Each fighter then gave a urine specimen. Botha's specimen was sent to a German laboratory, where it tested positive for anabolic steroids. In accord with the anti-doping Bout Rule, Botha was then allowed to choose where the sample would be tested a second time; his choice, the UCLA Olympic Analytical Laboratory, also found anabolic steroids in his urine. During this period, Botha vigorously denied using steroids.

The German Boxing Federation -- the local boxing commission that signed the Bout Rules -- recommended on February 15, 1996 that the IBF disqualify Botha and that Schulz be designated IBF world champion. The Federation also barred all the boxers, promoters, referees, and trainers whom it licensed from taking part in Botha's bouts for two years.

On Saturday, February 24, 1996, upwards of two months after the Stuttgart bout, the IBF held a hearing in Elizabeth, New Jersey, to determine what action would be taken as a result of the positive steroid tests. *fn1 The hearing was conducted by the IBF's Executive Committee and its subcommittee, the Championship Committee; the Championship Committee was to make a recommendation to the Executive Committee, which had final authority. All persons having an interest in the outcome of the Botha/Schulz bout were notified of the hearing and given an opportunity to be heard. The committees heard testimony from Botha, from his attorney and two of his doctors, and from representatives of Schulz, the German Boxing Federation, and Michael Moorer.

Moorer was at the time a former IBF and World Boxing Association heavyweight champion. In September 1995, Moorer had sued the IBF in federal court in New Jersey over the IBF's rankings, seeking to block the Botha/Schulz bout because, he argued, he was entitled to fight next for the title. A settlement agreement signed later that month provided that Moorer would dismiss his action in return for a guarantee that he would, within 180 days of the Botha/Schulz bout, fight the winner for the IBF title. At the IBF's February 24, 1996 hearing, Moorer's counsel reminded the IBF of its agreement with Moorer.

Botha's testimony at the hearing was a surprise: he admitted for the first time that he had taken the drug found in his urine. He argued, however, that he had not known that what he took was a steroid. Botha stated that he had injured his arm in 1988 and his South African doctor had given him two prescriptions for the pain and swelling. In March 1995, after Botha had moved to California, his South African doctor had sent him a third medication for his continuing arm stiffness, which was the steroid (Deca Durabolin) that turned up in his urine. (There is a good deal of controversy about the steroids' possible impact on Botha's capacity as a fighter, but the controversy -- the main elements of which are summarized in the annexed footnote *fn2 -- does not appear to bear upon the issue before this court, namely the appropriateness of the district court's preliminary injunction.)

After hearing all the testimony, the IBF Championship and Executive Committees recessed to deliberate. When they returned, IBF President Robert W. Lee announced the IBF's decision: We will not vacate the title of Francois Botha. There are mitigating circumstances which cause us to feel that we should not vacate the title of Francois Botha.

However, what we will do is we will fine Francois Botha in the amount of $50,000 for having taken these substances into his system that were in violation of our rules.

Secondly, we will order a rematch between Francois Botha and Axel Schulz to take place within 180 days of today or ...


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