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NYSAC Under Fire: The federal government steps in, Part II

10
Aug

Read Part I here.

As I wrote earlier this year, the administration of New York Governor Andrew Cuomo has in some ways been a model of effective governance. Other times, it has fallen short of the mark.

The most notable failure of the Cuomo administration has been in the area of government ethics and the need for reform. On July 2, 2013, the governor announced the creation of a “Commission to Investigate Public Corruption” in New York. Less than a year later, he shut the commission down. At that point, the United States Attorney’s Office for the Southern District of New York intervened.

The three most powerful men in Albany were Cuomo, Speaker of the New York State Assembly Sheldon Silver and Majority Leader of the New York State Senate Dean Skelos. Silver and Skelos were each indicted by a federal grand jury and found guilty at trial (Silver on seven counts of abusing his office for more than $4 million in personal gain; Skelos, along with his son, on eight counts of bribery, extortion and conspiracy).

In each instance, the prosecution was spearheaded by Preet Bharara, the United States Attorney for the Southern District of New York. Now there are indications that Bharara has his sights set on the Cuomo administration.

A federal investigation over ring credentials?

No. A federal investigation into the possibility that the Office of the Inspector General of the State of New York was improperly influenced by the Governor’s office.

The Inspector General was asked by the Secretary of State to investigate the New York State Athletic Commission on Nov. 11, 2013. As noted in yesterday’s installment of this report, a staff member in the inspector general’s office made courtesy calls to several people in December 2014 (more than a year later), telling them that release of the report was “imminent.”

But the report wasn’t released.

Eighteen months after that, on June 15, 2016, Paul Edelstein (the attorney for the family of Magomed Abdusalamov) brought an Article 78 proceeding in New York State Supreme Court against the inspector general’s office, asking the court to order the inspector general to turn over “all reports, whether draft or final versions, pertaining to the inspector general’s investigation [of Abdusalamov vs. Mike Perez].”

Then, on June 24, 2016, Edelstein wrote to Bharara. In part, his letter stated, “It is particularly concerning to this office that an independent commission such as the Inspector General’s office is perhaps being influenced or pressured by the very state government it is charged with investigating. As such, we believe it would be appropriate for your office to investigate the matter further to determine if the report is being wrongfully and unlawfully suppressed.”

On July 5, 2016, the New York State inspector general’s office filed a motion to dismiss Edelstein’s Article 78 proceeding, arguing, “The Inspector General’s decision whether to release a final report regarding her findings is purely discretionary and not subject to judicial review.” The motion to dismiss further maintained that draft reports are “exempt from disclosure.”

Then word began to spread that several people had been approached by federal authorities and asked about the failure of the inspector general’s office to release its report. In the interest of disclosure, I was one of those individuals. There are indications that federal authorities might also have raised the issue with one or more persons at the inspector general’s office. That could have been the catalyst for the July 25, 2016, release of the inspector general’s report.

One day after the report was released, at least one potential witness received an inquiry from federal authorities asking if he would accept email service of a subpoena to testify before a grand jury.

The inspector general’s report was highly critical of Melvina Lathan, Tom Hoover’s predecessor as chairperson of the New York State Athletic Commission. In part, the report stated, “Having served as chairperson of the Athletic Commission for over five years and as the sole commissioner receiving a full-time salary, Lathan was responsible for the daily operation of the Athletic Commission and for its leadership. Thus, she was primarily responsible for the deficient procedures and policies identified in this investigation and for deficient operation and oversight. Testimony revealed that the [other] commissioners did not engage in the kind of analysis of policies and procedures or management that is required to operate a commission properly.”

And the report savaged Hoover for abusing his position to benefit family and friends, sometimes mocking Hoover’s attempts to justify his conduct.

For example, Hoover had told the inspector general’s staff that he added his son and a friend to the NYSAC credentials list because they were “prospective inspectors.” The inspector general’s report said the following about that: “Hoover testified that a background in boxing is a prerequisite for becoming a boxing inspector, but said that his son and his son’s friend’s only qualifications for becoming inspectors was that they were ‘big guys.’ Hoover’s use of his son’s middle name rather than their shared last name further suggests that Hoover knew his conduct was problematic.”

But Hoover’s ethical issues were minor compared to the larger problems that beset the New York State Athletic Commission. And there, in some respects, the inspector general’s report fell short. It correctly devoted dozens of pages to the inadequate nature of the NYSAC’s medical protocols and procedures in conjunction with Magomed Abdulsalamov. But it ignored an instance when proper medical protocols and procedures appear to have been ripped asunder by the governor’s office.

As noted earlier, a study of tapes, transcripts and other material developed during the inspector general’s investigation shows that evidence was gathered in a diligent and conscientious manner. As part of that effort, the staff compiled extensive testimony regarding political pressure that was brought to bear upon the NYSAC to license Antonio Margarito for a fight against Miguel Cotto at Madison Square Garden in 2011 despite overwhelming evidence of an eye injury that rendered Margarito unfit to fight.

The inspector general’s report makes no mention of Margarito, which is a shocking omission that has upset several ring doctors. And concern among some commission medical personnel has grown since the most recent fight card at Barclays Center.

On July 30, 2016, Showtime televised a triple-header from Barclays promoted by DiBella Entertainment and headlined by Leo Santa Cruz vs. Carl Frampton. The opening TV bout was Tony Harrison vs. Sergey Rabchenko. Dr. Avery Browne of the New York State Athletic Commission conducted a routine physical examination of Harrison in the dressing room before the fight. In response to a question from Dr. Browne, Harrison said that he’d taken Advil several hours earlier for a sore shoulder.

The New York State Athletic Commission “Drug Notice and Boxer Acknowledgment Form” states, “Boxers participating in a boxing match should avoid the use of non-topical non-steroidal anti-inflammatories (NSAIDS) within one week of a boxing match because of a potential increased risk of bleeding. Use of NSAIDS within one week of a boxing match may result in cancellation of the match.”

Advil is one of the prohibited medications.

Dr. Browne is a defendant in a lawsuit brought by the family of Magomed Abdusalamov in conjunction with the injuries Abdusalamov suffered at Madison Square Garden on Nov. 2, 2013. Browne was the ringside physician assigned to Perez’s corner that night. He had nothing to do with the decisions regarding Abdusalamov’s medical care. Piecing the story together from multiple sources, it would seem that Dr. Browne wasn’t the decision-maker with regard to what transpired next with Tony Harrison either.

Dr. Barry Jordan, the current NYSAC chief medical officer, wasn’t at Barclays Center on July 30. Reached by telephone, Dr. Jordan said that Harrison-Rabchenko should be called off. There was extensive back-and-forth, during which promoter Lou DiBella and Alex Dombroff (an attorney for DiBella Entertainment) advised Charles Fields, John Signorile (the only NYSAC commissioner on site) and Eric Bentley that Harrison had misspoken to Browne and might have taken Tylenol instead of Advil.

Pressed to make a decision, Fields and Signorile ruled that Harrison-Rabchenko could go forward provided that Harrison agreed to sign a written declaration (drafted by Dombroff and NYSAC deputy commissioner Keith Sullivan with input from Department of State attorney Jim Leary) that he hadn’t taken Advil and also agreed to go to a hospital after the fight for a toxicology test to determine if Advil was, in fact, in his system.

Al Haymon, Harrison’s manager, approved the resolution. The declaration signed by Harrison read, “I certify and affirm under penalty of perjury that the only over-the-counter drug I have taken in the last 24 hours (from [SIC] 8:00 PM on Saturday, July 30) is Tylenol in which the only active ingredient is acetaminophen. I misspoke during the pre-fight physical in stating that I took Advil; for purposes of clarification, I did not take any medication containing Ibuprofen in the last 24 hours.”

Harrison’s declaration was witnessed by Henry Hill and Amir Salaam from Team Harrison as well as Dorothea Perry (one of two NYSAC inspectors assigned to Harrison’s dressing room) and Eric Bentley.

Haymon later told a third party that a sample was taken from Harrison for toxicology purposes after the fight. The result of that toxicology test is not publicly known.

Either way, testing Harrison after the fight did nothing to protect him from a potential brain bleed.

One participant in the deliberations at Barclays Center says, “It would be unfair to punish a fighter because he doesn’t know the difference between over-the-counter drugs.” But this is an instance when, as with Cotto-Margarito, the NYSAC changed the initial ruling of its own medical staff and appears to have been more interested in protecting itself with a hastily drafted statement than in protecting the fighter.

By way of comparison, on April 9, 2016, Alicia Napolean was scheduled to fight in the main event at 5 Star Banquet Hall in New York. During her pre-fight physical examination in the dressing room, she told the doctor that she had taken Advil that day. David Berlin (then the NYSAC executive director) and Dr. Jordon caucused. Napolean had sold thousands of dollars worth of tickets. On Jordan’s recommendation, the fight was cancelled.

“It was a hard moment,” Berlin said afterward. “But the decision was easy. A fighter is at risk every time he or she steps into the ring. We can’t knowingly add to those risks.”

There are many good, dedicated, hard-working employees at the New York State Athletic Commission. But right now, the NYSAC is in turmoil.

On July 9, 2016, the New York Post published an article by George Willis that read in part, “At a time when the NYSAC needs to be working as a cohesive unit, there appears to be chaos. Several boxing promoters have complained about disarray within the NYSAC, with one prominent figure in the New York boxing industry charging, ‘They just don’t care.’”

On July 25, 2016 (the day the inspector general’s report was released), Rick Karlin’s “Capitol Confidential” column in the Albany Times Union ran beneath the headline “IG Issues Blistering Report on State Athletic Commission.” In his column, Karlin declared, “The findings also appear to vindicate David Berlin, who recently left the Commission under pressure for what he said was his blowing the whistle on problems at the organization.”

Insiders say that, without the oversight of acting executive director Eric Bentley, the recent July 30 card at Barclays Center would have become a regulatory shambles.

Barry McGuigan is widely respected throughout the boxing community as a former world champion and also for his work as a manager, newspaper columnist and TV commentator. McGuigan was in New York with Belfast native Carl Frampton, who fought Leo Santa Cruz at Barclays on July 30.

“The commission in New York is horrible,”McGuigan told this writer. “I’ve never experienced anything like it. I understand the need to protect fighters. But these people have made things unbelievably difficult for us at every turn. And half the time, it seems like they don’t know what they’re doing. It’s like they don’t want fights in New York.”

Whether or not the NYSAC wants fights in New York – and one assumes that it does – the odds are that there will be fewer of them in the near future.

On April 14, 2016, Governor Cuomo signed a bill passed by the state legislature lifting the ban on mixed martial arts competitions that had been in place since 1997.

The new law also addressed several medical issues. Ring physicians were reclassified as state employees rather than independent contractors, thereby halting an exodus of qualified ring doctors who were concerned that their own liability insurance wouldn’t protect them against claims of medical malpractice lodged against them by fighters. In addition, the cost of fighter medical examinations (previously paid for by the state) was shifted to fighters and promoters.

But there was more.

The Muhammad Ali Boxing Reform Act mandates that promoters purchase medical insurance on a card-by-card basis to pay a fighter’s medical expenses for the diagnosis and treatment of injuries suffered during a bout. But the Ali Act doesn’t specify a coverage minimum. That decision is left to the individual states.

Medical costs in New York are among the highest in the nation. But it required that promoters maintain only a $10,000 medical insurance policy for each fighter (significantly below the $50,000 minimum required by Nevada, California and Texas).

Berlin had advocated for raising the $10,000 medical insurance minimum to $50,000. At the same time, he proposed lowering a statutorily required $100,000 death benefit to $50,000.

“I did some research,” Berlin says. “The cost of the insurance would go up with the new numbers, but cutting the death benefit would limit the increase. Ring deaths are rare, so the $100,000 was a less important number. We had to strike a balance between protecting boxers and not imposing excessive costs on promoters.”

So far, so good. But there was a problem.

Governor Cuomo wanted a majority of Democrats to support the legislation, the centerpiece of which was the legalization of mixed martial arts. So to gather support, he agreed to the last-minute insertion of a provision that requires all promoters of boxing matches and other martial arts competitions to provide medical insurance or another form of financial guarantee acceptable to the NYSAC with a minimum limit of $1 million. This million dollars would be used to cover medical, surgical and hospital care for the treatment of life-threatening brain injuries in situations where an identifiable causal link exists between the fighter’s participation in a fight and the life-threatening brain injury.

The $1 million insurance requirement is scheduled to take effect on Sept. 1. It might have been well-intended, but it’s not practical. The cost of the premiums will make it impossible to promote most fight cards on a cost-efficient basis in New York.

Berlin first became aware of the $1 million proposal in early 2015 and voiced his reservations to Executive Deputy Secretary of State Anthony Giardina and Brendan Fitzgerald, Deputy Secretary for General Government and Financial Services. In spring 2015, Berlin was asked about the matter by State Senator Joseph Griffo and expressed his concern that the requirement could put small promoters out of business while encouraging the flight of large promoters to other states.

The NYSAC has now posted a set of proposed rules and regulations that, among other things, are designed to fine-tune the $1 million insurance requirement. Public comments will be accepted by the NYSAC until Aug. 27, after which the rules and regulations will be finalized.

In part, the proposed rules and regulations state:

  • “‘Identifiable, causal link’ shall mean that the injuries sustained by the licensed professional during his or her participation in the authorized covered combative sports program were the direct and proximate cause of the life-threatening brain injury.”
  • “‘Life-threatening brain injury’ shall mean an acute brain injury that, in the opinion of the professional licensee’s treating physician, would result in the death of the professional licensee if left untreated.”
  • “‘Sustained in a program operated under the control of such licensed promoter’ shall mean that the symptoms of the life-threatening brain injury must first manifest themselves during, or within twenty-four hours after the end of, the licensed professional’s participation in the covered program, and the injury must be diagnosed by a physician during or within forty-eight hours after the end of the licensed professional’s participation in the covered program.”

Under the NYSAC’s proposed rules and regulations, a brain bleed that is serious but not considered likely to “result in death if left untreated” would not be covered. Nor would a “slow” brain bleed that doesn’t manifest itself within 24 hours.

Here it should be noted that Pedro Alcazar, while still on his feet, was stopped by Fernando Montiel in the sixth round of a June 22, 2002, fight at the MGM Grand in Las Vegas. Thirty-six hours later, while taking a shower in his hotel room, Alcazar collapsed as the consequence of a slow brain bleed and died.

Also, serious brain injuries are less likely to occur in mixed martial arts competition than in boxing. But spinal cord injuries are more common in MMA. And the longterm cost of treating a spinal cord injury is often greater than the cost of treating a brain injury. Shouldn’t coverage for severe spinal cord injuries be in line with the coverage for life-threatening brain damage?

New York has always been an expensive place to promote boxing. Hotel, food and labor costs are higher in New York than elsewhere. New York’s million-dollar insurance requirement might be the straw that breaks the camel’s back.

NYSAC representatives have told several promoters that they’ve found an insurance company that will underwrite the required insurance policies for a premium cost of roughly $7,500 per fight card. That would be significantly more than the current premium cost. And more troubling, the $7,500 estimate seems too good to be true.

A study of medical insurance premiums paid by one promoter reveals that the promoter paid $87,820 in premiums during a recent one-year period for insurance covering fight cards in New York. And the insurance company paid out $169,000 to settle claims for medical treatment under those policies.

That’s a 192-percent loss ratio. And the pay-outs were capped at $10,000 per fighter. The new law requires a policy minimum of $50,000 plus a $1 million balloon for life-threatening brain injuries.

Michael Dean is the head of Francis L. Dean and Associates, the insurance underwriters identified by the NYSAC as being likely to underwrite million-dollar medical insurance policies for combat sports in New York. The company has offices in five states and brings in more than $60 million in insurance premiums annually.

“At this time,” Dean said during a July 29 telephone interview, “we haven’t finished our pricing model. It’s being worked on by our actuaries. We hope to resolve this at our end within 30 to 45 days. Then any policy we propose would be subject to the New York State Department of Financial Services (which regulates insurance in New York). We have some risks that are profitable and others that aren’t. We want to be profitable, and we make adjustments to our rating structure accordingly.”

Dean also acknowledged the possibility that Francis L. Dean and Associates might choose to not underwrite the policies. Moreover, because of the 24- and 48-hour windows in the proposed regulations, fighters might be sent for unnecessary, and costly, tests to avoid complications that would arise if symptoms became more obvious after the time-window had closed. The cost of these tests would be set against the $50,000 policy limit, and policy premiums would rise accordingly.

“I’m glad that the commission clarified the policy requirements with its new proposed regulations,” Dean added. “But ‘life-threatening brain injury’ is still an ambiguous term.”

Plans for fights are often made months in advance by promoters. The longer it takes to resolve the insurance issue, the fewer fights there will be in New York this autumn. Promoters might be able to pay a five-figure insurance premium for a major show at Barclays Center or Madison Square Garden. For a small club card, that wouldn’t be practical. And even major events are in jeopardy.

Pat English, the attorney for Main Events, which is scheduled to co-promote Sergey Kovalev vs. Andre Ward with Roc Nation on November 19, says, “The million-dollar insurance requirement was a factor in Kovalev-Ward going to Las Vegas. I’m not saying that the fight would have wound up in New York without it. But Roc Nation wanted the fight at Madison Square Garden. And the million dollars made that impossible.”

Boxing in Brooklyn appeared to be hitting its stride in recent months when DiBella promoted back-to-back fight cards headlined by Keith Thurman vs. Shawn Porter and Santa Cruz vs. Frampton at Barclays Center. That progress is now on hold. Danny Jacobs fought his two most recent fights at Barclays under the DiBella banner. His Sept. 9 title defense against Sergio Mora will be contested in Pennsylvania.

This is a situation where the NYSAC has to act. The new law states, “The commission may from time to time promulgate regulations to adjust the amount of such minimum [medical insurance] limits.”

That’s construed by some as meaning the commission may only adjust the insurance minimums upward. Others believe that the NYSAC can adjust the minimums up or down. Jim Leary (counsel for the Department of State) notes that the previous statute gave the NYSAC authority to “increase” the insurance minimums, while the new statute gives the commission authority to “adjust” them and that this supports the idea that lowering the $1 million minimum is possible.

There were 11 fight cards in New York during the last four months of 2014 and 11 during the last four months of 2015. Without timely action by the NYSAC, it’s unlikely that number will be matched in the final four months of this year.

Who will be the decision-makers regarding the insurance minimum?

The legislation that legalized mixed martial arts and was signed by Andrew Cuomo on April 14, 2016, also increased the number of commissioners on the NYSAC from three to five.

Hoover was serving as a holdover in a term that expired on Jan. 1, 2016. One day after his resignation was announced, the NYSAC revealed that Ndidi Massay had been named interim chairperson.

Massay was one of more than a dozen nominees for a variety of positions who were confirmed pursuant to a single voice vote by the New York State Senate Standing Committee on Finance on June 17, 2016, without their having appeared before the committee. No press release was issued after her confirmation.

On July 26, 2016, in response to an inquiry from this writer, Laz Benitez (a press officer for the New York State Department of State) wrote, “Massey will serve in a part time capacity on an interim basis until a permanent Chair is designated by the Governor.”

One day later, the Department of State press office issued a clarifying statement that read, “The ‘interim Chair’ title is being used as a functional title to denote that Commissioner Massay will manage the agenda and lead Commission meetings until a new Chairperson is formally designated by the Governor. Use of this functional title for Commissioner Massay does not denote and should not be confused with the formal designation of a full-time Chairperson of the State Athletic Commission.”

Massay is a business woman and attorney with no known experience in the sport or business of boxing. She did not attend the July 30 fight card at Barclays Center, the first of her tenure as interim chairperson.

John Signorile is serving as an NYSAC commissioner pursuant to a term that expired on Jan. 1, 2015. He and Edwin Torres, an 85-year-old retired New York State Supreme Court judge now serving on the NYSAC pursuant to a term that expired on Jan. 1, 2014, were commissioners during the events described in the recent Inspector General’s report.

In other words, Andrew Cuomo has four commission seats to fill. The people he appoints (or reappoints) will reveal a great deal about his philosophy of government.

Meanwhile, a cynic might note that the NYSAC is starting to resemble a world sanctioning organization. It now has an interim chairperson, an acting executive director, two commissioners with terms that have expired and two empty seats.

That might be amusing but for the fact that boxing is a dangerous sport. Each little mistake has the potential to undermine the safety and fairness of the competition and increase the chances that a fighter will die.

Writing in “Moneyball” about the failure of baseball to understand and embrace the sabermetric revolution in a timely fashion, Michael Lewis declared, “The game itself is a ruthless competition. But in the space just off the field of play, there really is no level of incompetence that won’t be tolerated.”

The same is often said of government and politics.

The NYSAC isn’t charged with overseeing human resources, mass transit or some other public sector where problems sometimes seem insoluble. It’s a small commission charged with regulating several dozen fight cards each year. It not hard to do the job right if conscientious, knowledgeable people are put in charge. But if political expediency takes precedence over good government, it creates a mess.

Right now, the New York State Athletic Commission is a mess.

If Governor Cuomo really wants to begin the process of solving the problems at the NYSAC, he’ll bring back David Berlin. As I wrote when Berlin was dismissed from his position, “It’s rare to find someone in boxing who genuinely cares about the sweet science, understands the sport and business, is ethical and smart, and is a good administrator. Berlin exemplified all of these qualities as executive director.”

All Cuomo would have to do is say, “This matter has now landed on my desk; not the desk of some subordinate. I’ve studied the matter. And while I don’t agree with everything that Mr. Berlin has said and done, I think he’s the right person for the job.”

But that won’t happen.

So let’s close for now with the thoughts of Teddy Atlas, who has been in boxing as an amateur fighter, trainer and television commentator for more than four decades.

“I’ve fought for this sport my whole life,” Atlas said recently. “I thought David Berlin was the right guy and he would help the commission and help boxing. And he did make the commission better while he was there. But it’s a political position. Politics has always been the shadow that looms over the commission. And the politics came in and ruined it.”

Thomas Hauser can be reached by email at [email protected] His most recent book (Muhammad Ali: a Tribute to the Greatest) was published in the United States by Pegasus Books and in the United Kingdom by HarperUK. In 2004, the Boxing Writers Association of America honored Hauser with the Nat Fleischer Award for career excellence in boxing journalism. He is a consultant to HBO Sports.