For a complete backstory, check out Zach Arnold's post at FightOpinion. The gist of the situation is that Zuffa is suing what exists of Dream Stage Entertainment for fraud in relation to the sale of PRIDE to Zuffa. FightOpinion also updated their column with this from the summary of the case:
Plaintiff purchased certain assets of defendant’s business under the Pride, Pride Fighting Championship and Bushido brand names. Because plaintiffs are involved in the gaming industry, defendants were required to cooperate with and submit to background checks and drug tests to ensure compliance with the regulatory requirements of plaintiff’s gaming license. Defendants failed to cooperate with, submit to or pass such background checks, defrauding plaintiffs into entering the agreement for “millions upon millions of dollars.”
The interesting part about this and something that Zach Arnold brought up as well is that this lawsuit may bring issues to light regarding the inefficiency of Zuffa to find out these particular details before the sale occurred. The brief above talks about the defendants not cooperating when it came to the background checks, yet the UFC still continued on with the sale.
Why is that relevant? It's likely that there are many more inefficiencies that have yet to be heard. The Nevada Gaming Commission will most likely be keeping a close eye on this lawsuit as they are very strict in regards to parent companies of casinos dealing with organized crime. As you may or may not know, DSE was connected to Yakuza in some ways, and the scandal involving those ties put PRIDE in jeopardy.
The Other Factors
One question lingers throughout this story, who exactly are they suing? Dream Stage Entertainment is dead, and only former employees are still involved in the industry. Former head Sakakibara is also named in the lawsuit, and could potentially be liable, but how much money can the Fertittas actually get back?
Again, the most interesting piece of this puzzle is the gaming licensing issues. If the NGA ends up finding out about the possibility of Zuffa being connected in an agreement to buy an organization that had ties to the Japanese mob, we could see some bad news hit the UFC's backing.
Where did the original money go from buying the organization? Many believe the Yakuza got the money, or at least people linked to the organization. This could all prove to be a huge mess, and it'll be insightful to see where the Fertittas can actually get the money back from.
In the end, this lawsuit will only bring to light other issues that Zuffa shouldn't want to be public knowledge, and if the NGA is keeping an eye on it, it probably isn't good for Station Casinos and the Fertittas. I guess the UFC should have done its research before the buy, instead of going into the deal with all these unknowns.