Solar under fire

Whether or not a smear campaign was orchestrated to tarnish Solar Entertainment’s image is now an academic issue because surely, the damage has been done.

Those who insist there was no such campaign should think twice. If you check what has been reported in the sports pages the last few days, you’ll see a lot of negativism surrounding Solar. First, the question of stability in light of its bid for the UAAP TV rights. Second, the issue of reducing talent fees. Third, the misinterpretation (deliberate or otherwise) of Solar’s quote of a 25 percent reduction in sales when asked to quantify the impact of inserting a lockout clause by the PBA in their contract. Fourth, the leak of Manny Pacquiao ditching Solar as his media partner.

The coup de grace was Pacquiao himself announcing his decision to leave Solar for ABS-CBN the other day. It was the perfect climax to a chapter-by-chapter script of one bad news after another for Solar. Now that the cat is out of the bag, it’s evident that the whole brouhaha was meant to justify Pacquiao’s exit from Solar.

Yesterday, Solar lawyer Enrique de la Cruz confirmed Solar’s live contract to air Pacquiao’s fights in the Philippines is “air-tight” until it expires on May 6, 2011.

Here’s the official message from Solar:

“The public is hereby advised that under a License Agreement dated May 7, 2007, Emmanuel (Manny) Pacquiao and MP Promotions, for valuable consideration, granted to Solar Entertainment the exclusive rights to the audio-visual presentation of all bouts of Manny Pacquiao from May 7, 2007, to May 6, 2011.

“Manny Pacquiao’s attempt to rescind the License Agreement without any factual or legal basis is ill-advised. All third parties are hereby warned against any tortuous interference with the License Agreement. Solar shall avail of all its legal remedies to the fullest extent against any undue breach of and/or tortuous interference with the License Agreement.”

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De la Cruz described Pacquiao as “a victim of a network war and manipulation.” He said trifling with an existing agreement won’t hold up in a court of law.

“Solar respects Manny’s decision but there must be a procedure and grounds to rescind a contract,” explained de la Cruz. “If ABS-CBN wants to air Manny’s fights, then it must come to terms first with Solar as the exclusive licensee.”

De la Cruz said Pacquiao’s decision couldn’t be unilateral although in his TV announcement, he made it clear the decision was his alone and appeared to shield ABS-CBN from accusations that the network initiated the move.

“A contract involves a meeting of two minds,” said de la Cruz. “It’s not a unilateral thing. There may be reason to believe Manny was induced.”

De la Cruz disclosed that last Monday, Pacquiao received P15 million from Solar or 25 percent of P60 million for the telecast rights to the Ricky Hatton bout on May 2.

“I don’t think there was a late payment or grounds for Manny to want to rescind the contract because of a failure to make good an obligation,” said de la Cruz. “There was no demand letter from Manny.”

The procedure to rescind a contract involves a 15-day notice to address an unfulfilled commitment and a 30-day notice of termination. In the Solar case, no procedure was followed and no grounds were cited for the rescission.

Under the circumstances, de la Cruz said Solar will be forced to go to court to protect its rights and restrain any network from airing Pacquiao’s fights without its prior consent. A legal recourse is to seek an injunction for any network, other than Solar, to air Pacquiao’s fights in the Philippines.

“If a network like ABS-CBN wants to air Manny’s fight, then it just has to go through Solar, pay Solar off or work out a joint arrangement with Solar but Solar will decide what course to take because it has the exclusive rights in the first place,” said de la Cruz.

From what he knows, de la Cruz said it may not be possible for Pacquiao to remain a talent with GMA-7 while his fights are exclusively aired on ABS-CBN. “I think a contract with either station is mutually exclusive,” he said.

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Because of Solar’s live contract with Pacquiao, de la Cruz said the network just can’t be left out in the cold. If Solar is ditched without an agreement for fair compensation, what good is a contract under Philippine law?

Talk of Solar’s alleged instability – the smear campaign – must have reached Pacquiao’s ears and it’s likely he reacted by entertaining an attractive offer to move to a rival network which is recognized as a “giant” in the industry.

ABS-CBN and Solar are no strangers to each other. They worked Pacquiao’s rematch against Erik Morales in a joint effort where both networks employed two separate broadcast panels at ringside in Las Vegas. ABS-CBN did Pacquiao’s fight against Oscar Larios at the Araneta Coliseum without Solar’s participation.

To enhance Pacquiao’s contract with Solar, a tie-up was made with GMA-7 for the boxing icon to appear in regular TV shows. What Pacquiao’s status will be with regard to the shows which are ongoing is a big question mark.

Surely, something can be worked out before the case is dragged to court. Pacquiao isn’t the only one caught in the middle of the network war. The whole nation is also in a bind because there is a danger that Pacquiao’s next fight might not even be aired in the country if the warring parties don’t smoke the peace pipe.

Top Rank is another entity that must be factored in the equation. Top Rank arranges Pacquiao’s fights outside of the Philippines and enjoys a close relationship with Solar. With ABS-CBN’s entry and its partnership with Top Rank’s chief rival Golden Boy, you wonder if Bob Arum will be as considerate. An American lawyer for Solar is now studying the implications of the rescission on the US front and will forward his evaluation shortly.

Let’s hope ABS-CBN and Solar come together, shake hands and reach a compromise for the sake of Pacquiao and the entire Filipino nation.