World of Boxing LLC v. King
56 F. Supp. 3d 507 (2014)
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Rule of Law:
The defense of impossibility of performance is unavailable to excuse a breach of contract if the supervening event that made performance impossible was foreseeable at the time of contracting. If a risk is foreseeable, the party whose performance is frustrated by that risk is deemed to have assumed it unless the contract provides otherwise.
Facts:
- On May 17, 2013, boxer Guillermo Jones fought Denis Lebedev and won, but subsequently tested positive for the banned diuretic furosemide.
- As a result of the positive test, the World Boxing Association (WBA) stripped Jones of his title and suspended him.
- On January 28, 2014, Jones's promoter, Don King, entered into an agreement with Lebedev's promoters, World of Boxing (WOB), for a rematch.
- The agreement required King to 'cause Jones to participate' in the rematch and explicitly mandated that Jones would be subjected to drug testing before the fight.
- The rematch was scheduled for April 25, 2014.
- On the day of the scheduled rematch, Jones again tested positive for furosemide.
- Following the second positive test, Lebedev withdrew from the bout, and the WBA confirmed it would not sanction the fight, leading to its cancellation.
Procedural Posture:
- Vladimir Hrunov and Andrey Ryabinskiy, doing business as World of Boxing (WOB), filed suit against Don King in the U.S. District Court for the Southern District of New York for breach of contract.
- King filed an answer and asserted counterclaims against WOB, alleging that WOB was the party that breached the agreement.
- WOB moved for partial summary judgment on the issue of liability, asking the court to rule that King had breached the contract and to dismiss King's counterclaims.
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Issue:
Is the defense of impossibility available to excuse a promoter's breach of contract for failing to produce a fighter when the fighter's disqualification was due to a foreseeable event, namely a positive drug test for a substance the fighter had used previously?
Opinions:
Majority - Judge Scheindlin
No. The defense of impossibility is not available to excuse a breach of contract when the event rendering performance impossible was foreseeable. King breached the agreement because his fighter's positive drug test, which was a foreseeable event, rendered him ineligible to participate in the bout as required by the contract. King's failure to perform is not excused by impossibility because the risk of a positive drug test was not an 'unanticipated event.' The court reasoned that the risk was foreseeable for two key reasons: first, Jones had a recent history of doping with the same substance, and second, the contract itself explicitly included a provision for pre-bout drug testing. This provision demonstrates that the parties actively contemplated the possibility of a failed test. King's subjective belief that the testing would deter Jones is irrelevant; the test for foreseeability is objective. By failing to include a contractual clause that would excuse his performance in the event of a positive test, King assumed the risk that this foreseeable event would occur, and therefore he is liable for the breach.
Analysis:
This decision reaffirms the narrow application of the impossibility defense under New York law, emphasizing that foreseeability is a critical barrier. It clarifies that 'unanticipated' does not mean 'unlikely' but rather an event outside the reasonable contemplation of the parties at the time of contracting. The case serves as a significant cautionary tale for parties in contract negotiations, particularly in industries where performance depends on the conduct of a third party with a known history of unreliability. It establishes that if a risk is identifiable enough to be mentioned or mitigated in the contract (e.g., via a testing clause), it is considered foreseeable, and the risk of its occurrence will be allocated to the promisor unless explicitly shifted to the other party.
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