Acontract impasse prevented Japanese competitive eater Takeru Kobayashi from participating in the annual July 4 Nathan’s Hot Dog Eating Contest on Sunday (and Mr. Kobayashi is spending the night in jail after an ill-fated attempt to mount the stage after the contest). Mr. Kobayashi’s representatives have said that he objects to (1) Major League Eating’s demand that he appoint them as his exclusive agent for endorsements and television appearances, and (2) MLE’s desire to prohibit him from participating in non-MLE events.
Speculating on the IFOCE Contract Terms
What exactly is the contract that the International Federation of Competitive Eaters (we will use IFOCE and MLE interchangably since MLE is simply a registered trademark of the IFOCE) wanted Mr. Kobayashi to sign, and which Mr. Kobayashi found to be so offensive?
We don’t know the details. But we may be able to take a guess by looking at a contract for another competitive eating event. It turns out that there are a couple of other competitive eating “leagues,” although operating on a much smaller scale than the (already small) MLE.
Major League Eating Has Competition—Sort Of
These other two leagues are the AICE (Association of Independent Competitive Eaters) and the WLOCE (World League of Competitive Eating).
According to the competitive eating event database site EatFeats, the MLE organized 71 events in the past year (17 of which were Nathan’s related), the AICE organized 12, and the WLOCE organized 3. These numbers may not be complete, but they show the small scale of competitive eating in general, and the tiny scale of the non-MLE leagues. (There are also non-league affiliated events nationwide.)
The tiny scale of the WLOCE turns out to be of assistance to us, because it appears that their lack of resources to hire their own legal counsel may have caused them to copy the IFOCE’s contract. A competitive eater who has seen both the standard IFOCE and WLOCE contracts thinks that the WLOCE contract as used in 2009 is a virtual copy of at least one version of the IFOCE contract.
We don’t know if this is true, and at any rate the contract for a major competitor like Takeru Kobayashi may very well be more complex and customized than the contracts used for “$1,000 chicken wing contests” (as George Shea of the MLE sarcastically refers to his competition). But the clauses in the WLOCE contract we’ve seen do look very similar to what Mr. Kobayashi has described.
A Competitive Eater’s League Contract, Summarized
Here’s an outline of the WLOCE league contract:
Athlete may appear in any league sanctioned event.
Athlete cannot apppear in any non-league event without the league’s permission, which can be withheld if the event conflicts or competes with the league.
Athlete appoints the league as his exclusive representative for any paid gig relating to his status as a competitive eater, including personal appearances, merchandising, licensing, advertising, film, television, radio, and internet. All such opportunities must be referred to the league, and the league must handle negotiations. The league receives 20 percent of gross income due the athlete under any completed deal.
The athlete licenses his name and likeness to the league to use in any promotional activities.
The athlete agrees to participate in any media events or interviews arranged by the league.
The contract does not create an employer-employee relationship.
Termination can only be by mutual agreement.
How Close is This to the Contract Takeru Kobayashi Rejected?
This seems to have all the elements that have surfaced in statements from Mr. Kobayashi’s representatives.
We don’t know what the term of Mr. Kobayashi’s previous contracts have been, but we got the feeling that they were 1-year contracts rather than the 2-year term as specified in Clause 1 above.
Clause 3 limiting participation to league events seems to jibe with what Mr. Kobayashi has said, with the exception that his previous contracts only limited his competitive eating activities in the United States and Canada. But based on statements attributed to Mr. Kobayashi’s publicist on Sunday, it sounds like Mr. Kobayashi no longer wants to limit himself to events organized by one league. We think both sides have a case here, and it comes down to bargaining power.
Clauses 4 and 5 are the problem. The league wants to double as the athlete’s agent/manager/attorney here. And thus the league wants to take a cut of all income that the athlete makes outside of competition. This is irrespective of whether the income derives from explicit reference to any league events. This seems like overreaching. MLE/IFOCE is already acting as both a sports league and a players association, and it now wants to in effect be each athlete’s manager/agent.
What is Fair?
What would a reasonable version of clauses 4 and 5 look like? Certainly the MLE has reasonable concerns about conflicts with its Pepto-Bismol sponsorship. A limitation of directly conflicting sponsorships might be reasonable (Alka Seltzer, for instance).
But what about other products, for instance beer? If Mr. Kobayashi gets a Coors Light sponsorship, that doesn’t conflict with MLE. What it might do is make it harder for MLE to approach Budweiser to sponsor next year’s Nathan’s contest. But why is that so? The reason is that the Nathan’s event is so closely associated with Mr. Kobayashi and Joey Chestnut that there is a perceived conflict. There would be no such perceived conflict if a professional football player endorsed a different beer than a Super Bowl sponsor, because no single football player is so closely equated with and identified with the Super Bowl. If the Nathan’s event has come to be equated with two individual athletes, that’s not the athlete’s problem. It’s the problem of MLE and Nathan’s, who need to work to develop other athletes rather than try to smother the only two stars that they have.
The bottom line is that, according to a recent media report, the MLE has been unable to supply a living wage to any of its athletes besides Joey Chestnut. Everyone else, besides Mr. Chestnut and Mr. Kobayashi, rely on other jobs to pay the rent. So we think it’s unconscionable for the MLE to be demanding a cut of all endorsement income without any limits.
Has Mr. Chestnut signed away all his ability to seek endorsements and make televisions appearances to the MLE? If so, then perhaps he should make some calls to a few entertainment and sports agencies and do some lunches.