Corporate Raiders of Las Vegas Launching Campaign to Move Oakland Raiders to Sin City; Fertittas Making Slick Moves to Liquidate Assets for NFL Team Purchase

By: Rich Bergeron

As a passionate NFL fan who happens to also have unique insight into the number one mixed martial arts organization on the planet, I'd like this article serve as a formal warning to the National Football League...

The Fertittas owning the Oakland Raiders or having anything to do with that storied franchise, or any other NFL team with such a solid football history will forever taint your organization. To put it bluntly: the brothers Fertitta are bad news, period.

It is a wonder to me that the Fertitta brothers (now through Red Rock Resorts) can still legally hold and profit off a gaming license in the state of Nevada in light of their own HISTORY. Lorenzo and Frank Fertitta III are not now, and they never will be... real "team" players. Here are three reasons why:

1.) They are always paying themselves first in every business deal they design, and they will do whatever it takes to create vast wealth off of shady and ruthless business practices.

2.) They have a documented history of abusing the bankruptcy courts to benefit themselves off the backs of hundreds of innocent investors.

3.) The Fertitta ownership of the UFC is a prime example of why they would be the worst possible owners of an NFL team the league could even imagine. UFC fighters are often saddled with egregious contracts that are riddled with complicated performance clauses and other nuances that make it very difficult for them to maximize their earning potential.

These slick Vegas casino baron brothers might be making stadium plans after collecting a boatload of liquid assets through their IPO of Station Casinos, but they are far from suitable owners for a major sports franchise in the NFL.

In their case, NFL ought to stand for "No Frank and Lorenzo."

The Oakland Raiders would be a great fit in Las Vegas, don't get me wrong. I'd love to see that city with an official NFL team, and it would generate local and international interest. I lived in Las Vegas for about two years (thanks in part to the Fertittas and their lawyers), and the city needs something like a big NFL stadium to stimulate the local economy and bring a different demographic to the area to enjoy something other than gambling and showgirls.

The main problem here with the proposed move is the movers. There are plenty of other fair players and sports enthusiasts based in Las Vegas who would be better ambassadors for the sport of football. NFL officials, please beware of these evil-minded brothers who wield an iron fist over the sport of mixed martial arts as it is. Even if they divest themselves from their casinos and the UFC, bringing them onboard the big NFL ownership bus means bringing their whole ugly past with them. It sends a bad message to honest people everywhere...nice guys finish last and greed is great.

The prior business moves and absolute disregard for the people they built their fortunes off the backs of is proof enough of the Fertitta brothers being unfit for NFL ownership. If there is any way to prevent any sale of an NFL team to this brotherhood, NFL officials should take that course of action and seek other investors who are unrelated to the Fertittas and their ugly shadow cast by a history of family corruption and financial scheming. The Oakland Raiders may need a figurative Hail Mary to stay alive in the league, but involving the Fertittas in their franchise as financial backers is like inviting the devil himself to be part of the ownership group. The Oakland Raiders can choose from a multitude of "lesser evils" in Sin City to build the franchise on a new frontier.

As an NFL fan who appreciates the growth of the sport amidst so many challenges like the concussion situation and the criminal tendencies exhibited by so many players in the league, I look at Fertitta ownership of an NFL team as a stain on the sport it will never be able to erase. I consider Fertitta ownership of an NFL team to be a crime against the sport itself.

I sincerely hope the National Football League engages in a due dilligence investigation into the past business dealings of the Fertitta Brothers before they hand Lorenzo and Frank the keys to Raiders Kingdom. Their civil litigation history alone is enough to raise plenty of concerns as to their ability to fairly manage such an undertaking without resorting to their familiar MO of scheming and scamming to line their own pockets. The NFL is rife with enough scandal without the shade these two brothers bring to the collective bargaining table.

The Choice of a NOS Generation

By: Rich Bergeron


It's only fitting that Xyience's star is falling and the brand is collapsing into debt just as Coca Cola's NOS brand of energy drinks cements a spot as the top sponsor of The Ultimate Fighter. TUF is the show that put Xyience on the map in the first place, so it's a strange coincidence.

News is trickling in lately surrounding the stable of fighters Xyience once sponsored, and it sounds like Xyience and Xenergy are at DEFCON X. Virtually all of the current UFC fighters on "Team Xyience" were cut from their sponsorship deals in recent days and weeks, and inside sources say the company owes at least 1.5 million dollars to Cott, the beverage giant responsible for creating and canning Xenergy. Without a bailout from the same Fertitta Family that owns the majority of the UFC, the company could be headed for a second bankruptcy or a fire sale. Fertitta Enterprises still owns and operates the brand, but a recent ultimatum from Frank Fertitta III and Lorenzo Fertitta forced the brand to make attempts to stand on its own without further financing from the billionaire brothers.

Inside sources also report that the Fertittas and UFC President and Part-Owner Dana White recently tried to convince Coca Cola's NOS brand to replace Xenergy as an official UFC sponsor. Right now NOS does not appear in any other octagon outside of the one on the TUF series. It's a relationship that the company fostered more with the Fox network than with the UFC itself. Yet, Dana is always drinking from his can of NOS whenever the show's camera crew catches him with one in hand. That's pretty interesting considering in past years fighters were sometimes caught "drinking" from closed Xyience cans. Dana's can is always open, much like his mouth.

What makes the NOS connection even more interesting is the fact that only a little less than six years ago, Dana White was telling NBC Sports that the UFC didn't need Coke's sponsorship:

“I’m cool with Mickey’s and Toyo Tires, man, believe me, you’ll never hear me bitch. The way that we’ve run this business and the way we have come up, think about it… we didn’t have any mainstream press, we didn’t have any mainstream sponsors, and look at how huge we are. I don’t ******* need Coke to keep doing what we’re doing, man. Believe me, the big time sponsors if they come on, of course that’d be fantastic. I don’t need ‘em. 18-to-34 year old males, they’re here hanging out with me. If Coke wants them, Coke needs to come to us.”

Suddenly it seems that White's words have come back to haunt the UFC, and apparently Coke still holds a grudge and won't bite on the league's multi-million dollar price tag to move their branding beyond the reality show. They don't need actual UFC fighters to flaunt their brand, either. The same tired commercial featuring a flashy, overconfident MMA fighter getting dropped with one punch is the new standard for NOS when it comes to marketing to the TUF fan base. And you can tell the winner of the fight in the commercial is really drinking from the can in the TV spot. He chugs it so fast, much of it ends up dripping down his face. Another jab at the UFC, although it seems unintentional, is the fact that the whole made-for-TV fight happens inside a ring, not a cage.

The Fertitta-run Xyience is in crisis mode these days, recently laying off multiple sales personnel and leaving the rest of the staff in fear of an imminent implosion. The company the Fertittas surreptitiously acquired by stealing it out from under hundreds of earnest investors is now a money pit. The Fertittas don't seem to want to spend the capital to keep the operation going despite getting a hold of the company for a song. It's the ultimate payback for all those shareholders who didn't get a dime out of the deal when the Fertittas purposely bankrupted the company and then retained ownership through a scandalous scheme involving former Cott executives pretending to enter into a serious purchase agreement only to later default on that deal.



For a little while the Fertittas made all the right moves to make the brand appear stable and ready to X-pand. Sponsorship deals with top-notch fighters like Jon Jones and Anthony Pettis appeared to be signs of the brand's resurgence as a key UFC sponsor. None of the fighters pictured above represent the brand any longer according to inside sources at the floundering supplement company. For Matt Serra, this marks the second time he's getting screwed for associating with Xyience. His prize for winning The Ultimate Fighter ended up getting wiped out by the company's bankruptcy, and he was the only fighter from that Xyience stable to come back to the brand before Chuck Liddell came out of Xyience retirement in recent months. Since Liddell's sponsorship agreement came with a pre-paid setup, he is among the last of the Mohicans still repping the brand. That's also fitting seeing as his initial Xyience sponsorship was one of the most lucrative deals in the history of the sport at the time of his first signing with the company.

The operation of Xyience once the Fertittas had control of it certainly betrays their attitude toward the fighters they employ in the UFC. It shows these silver-spoon billionaires just don't give a damn about the people who line their pockets. These recent developments illustrate an underlying selfishness on the part of the UFC's royal family that pervades everything they do. Xyience only mattered to them when it was a way to get a HUGE LOAN or a way to pay the UFC with the same money they used to get the chief lien position over the company just before they rigged the bankruptcy process to work in their favor.

At the moment my own legal battle with Xyience and the Fertittas is in limbo. I've been waiting for the right moment to ask for a final hearing on my remaining claim asking for millions of dollars in sanctions against the Fertittas and their associates who made the whole fraudulent bankruptcy possible by silencing my reporting. Should Xyience and Xenergy fold due to the Fertittas failing to put their own money up to bail their UFC sponsor out, it will be the perfect cap stone for the case I've built brick by brick and year by year to prove that Frank and Lorenzo Fertitta only wanted Xyience to be a going concern if it operated as a personal piggy bank. Without any way to siphon money off the brand or use the brand to make the UFC look better than it actually is, the Fertittas just don't need it. Sadly, this has been the trend as long as Xyience has been in business. It's been passed from one abusive management and ownership crew to the next. Everyone seems to find a way to smack it around and treat it like another red headed stepchild with no real identity or meaningful purpose for living and thriving.

What seems to get lost in translation to most of the fans who stumble onto this story is that there are real victims behind this ongoing scandal. As the saga continues to unfold the people who suffered most are only reminded of the savings they invested into the fledgling Xyience. They saw all their hard-earned dollars put into the company get wiped out by a couple of scumbag brothers who have way too much money to begin with. Some of the children of these victims had to forego college. For many, their retirement plans were catastrophically altered. The money some of them spent their entire lives putting away for a rainy day is just gone, flushed down the drain by the careless and ruthless actions of a couple of casino barons who had all their wealth passed down to them from Daddy Dearest. They will never know what it is to truly earn a paycheck, but those they victimized over the years to keep themselves healthy and wealthy will always know what it's like to lose everything and have to start over.  

Let it be known that the Fertittas just don't care about real people with real struggles. They don't have any genuine concern for their own fighters, and they don't get bent out of shape in ruining families just to make themselves a little richer. Making things right for every individual they burned in the Xyience bankruptcy would be a drop in the bucket for these two billionaires with their ever-growing business empires, but they choose to ignore the suffering and act like it never happened.

While I never rooted for Xyience to fail in the past, it seems to be sweet justice to see it failing now. I seriously doubt my fledgling BOYCOTT XYIENCE campaign made a dent, but I'm at least proud that I never really gave up the struggle to educate the public about who the Fertittas really are and where their motivations really lie. I will never forget the people who really put Xyience in position to be successful in the first place, and I will cherish the day I am allowed to put Frank and Lorenzo on the witness stand to answer some real hard hitting questions about the damage they've done and the lives they've destroyed in the name of pure greed.

In all honesty, I hope Xyience doesn't fail just yet. I hope that the Fertittas actually sink a few more million into trying to make it work. I hope they invest just enough so they wind up losing as much as the people they've screwed over the years have lost for believing the brand would be taken care of by the UFC owners. Now that would be real justice. Here's to hoping Karma catches up to these corrupt and spineless scamsters, so even if the burned Xyience shareholders don't get any financial relief they can at least get a little revenge...served with a cold can of Xenergy.   

X Marks the Sport: Xyience Scam Shows Dark Side of MMA's Most Powerful Promotion

"Where ignorance is bliss, 'tis folly to be wise." Thomas Gray, Ode on a Distant Prospect of Eton College, 1742

From the oldest dimestore novels to the most current TV cop dramas, a classic element of detective stories is the old familiar line about the perpetrator always coming back to the scene of the crime.

As Xyience Inc. limped through a controversial bankruptcy process over the past few years, the Xyience and Xenergy branding was relegated to UFC fighters wielding cans of the energy drink and the Xyience.com and other Xyience and Xenergy logos appearing only on the outer ring of the mat or on the ring bumpers.

The old center of the mat space Xyience used to occupy became prime real estate that Harley Davidson and Bud Light occupied for most of Xyience's absence. 

Saturday, May 5, 2012, marked a milestone for Xyience: a triumphant return to their old domain. Once again, the brand picked up where it left off, marking the center of the mat space for UFC on Fox 3 with the "Xenergy" (pronounced Zen-ergy) name, focusing on the company's sugar-free energy drink.

Ironically, this is the same strategy employed by Xyience Founder Russell Pike. Now facing July sentencing for being found guilty of tax evasion, Pike's been someone the current company wants to distance the brand from. Yet it was Pike who first decided to take the Xyience bar code off the mat and replace it with a Xenergy can.

Back then Pike's goal was to drum up interest in a potential buyout of the drink label while the rest of the company would continue under the Xyience name.

Though the Fertittas seem to paint Pike as the prototypical fall guy, they went to great lengths to lock the founder and his friends and family out of controlling the operation so they could bankrupt it after promising shareholders that their involvement and intervention would save the company from such a fate.  

On Oct. 2, 2007, Xyience Co-CEOs Adam Frank and Kirk Sanford informed Russell Pike, William Pike and Michael Clark (shareholders who represented 25 percent of the shares outstanding) that if they did not sign the funding consent form for the Fertitta funding and give up their voting rights, Frank and Sanford would put the company into bankruptcy.

On Oct. 3, under duress, the Pikes, Clark and other major shareholders signed the consent forms. Only 11 shareholders, who represent over 50 percent of the shares outstanding, ever saw the funding agreement before it became official.

An email sent by Fertitta Enterprises GM Bill Bullard to Lorenzo Fertitta on Oct. 4, 2007 discussed a $150 million offer from Cott Beverages to buy Xyience. This email was only found due to an intense discovery process initiated by the trustee's counsel, Jon Backman. The full text of that message is below:

By January 2008, the Fertittas perfected their scheme by foreclosing on their loan and speeding the company ship toward the iceberg of bankruptcy.

Instead of letting Cott buy the company at full price, two former Cott executives wound up agreeing to purchase the brand out of bankruptcy for $15 million through a front company called Manchester Consolidated.

Coincidentally, that purchase price was exactly 10 percent of the $150 million mentioned above. Manchester would later default on their payment plan, ceding control back to Fertitta Enterprises.

All the golden parachutes were reserved for company insiders who were in on the scheme, and over the past four years and counting the result of losing their Xyience investments tore apart innocent families, caused individuals who lost everything significant pain and aggravation, and forced a ton of folks to start over on building their once-substantial nest eggs.

The Fertittas rode into the sunset with their own supplement company that is now making record profits.
  

Few Mixed Martial Arts fans know the true extent of what went on behind the scenes at Xyience leading up to and throughout the ongoing bankruptcy. Wednesday, in a Las Vegas courtroom in front of a substitute judge from Hawaii, Attorney Jon Backman, the bankruptcy trustee's counsel for Xyience, settled some contentious issues with Fertitta Enterprises. 

The re-organized Xyience (Zyen, LLC) staff celebrated the announcement of the settlement recently with a huge catered dinner at Red Rock Casino, the most modern and luxurious casino the Fertittas own in Vegas. They're calling the next phase of the business "Xyience, Round 2."

Meanwhile, 385 original Xyience shareholders will be left with absolutely nothing once the final check is signed distributing the final dollar left in the trust.

Over 65 million shares issued in the company during their early days of rubbing elbows with the UFC will now be worth less than the paper they're printed on. Family trusts, retirement accounts and college funds were wiped out by the Fertitta takeover.  

Some say life imitates art, while others argue it's the other way around. I stumbled upon the Xyience debacle for the first time as an independent investigative reporter covering the sport of MMA in 2006. The resulting project and related litigation eventually became a significant part of my everyday life.

This site will someday make a phenomenal book and/or documentary effort. The experience proves beyond any reasonable doubt that fact is truly stranger than fiction. 

Those MMA fans who might wonder why they should care about scandals like Xyience need to look at the bigger picture. The Fertittas knew they could get away with this from the very beginning when they first pulled the trigger on this scheme. Consider this snippet from a Las Vegas Business Press article printed a month into the bankruptcy:

Attorneys for three unsecured creditors claimed that the deals were part of a "lend to own" strategy pursued by the Fertittas.

The Chicago law firm of Bell, Boyd & Lloyd filed papers alleging that Xyience's "bankruptcy case appears to being run for the sole benefit of Zyen -- the debtor's insider secured creditors."

It added: "Zyen is given a giant axe to hold over the debtor's head, while the debtor's credits are left with no opportunity to defend themselves against improper chopping."

Zyen, a Fertitta company, would have the right to make a bid for the company, the Chicago attorneys contended.

Chicago attorney Jim Morgan told the judge: "There is going to be possibly a forced sale with absolutely nothing left in the estate for unsecured creditors."

Greg Garman, attorney for the Fertitta's Zyen, rejected criticism from shareholders and unsecured creditors, even though his clients' crooked behavior was one of the main reasons why these parties were concerned in the first place. It is unlikely that Xyience shareholders will recover anything from the bankruptcy due to the large amount of debt, Garman said.

The bigger picture reveals that Xyience's bankruptcy basically served as a practice run for the much larger and more profitable Station Casinos bankruptcy. Both companies sit comfortably on the other side of bankruptcy as reorganized entities at the moment. Station Casinos just announced a $6.8 million profit for the first quarter of 2012.

The Fertittas are still rich and getting richer, but at what cost? The little people paid for it all, from the private jets to the tailored suits to the luxurious mansions.

Pension funds and savings accounts across the nation affecting countless average Americans in multiple locales were impacted negatively by the unethical and irresponsible behavior of the Fertittas and their minions. 

Too many MMA fans and even more MMA media professionals stick their heads in the sand and pretend that the UFC's primary owners are great guys, model citizens, and all-around heroes. If you look into their past, you will see that Xyience is just the tip of the iceberg.

Since their transgressions have gone unchecked for so long, these powerful Las Vegas brothers keep generating bigger and bolder schemes, enlisting high-powered local lawyers to deal with the fallout. They grease the palms of enough national political forces to insulate themselves from any federal probe, too. 

This penchant for pulling off fraud and stepping on the toes of little people most certainly carries over into their operation of the UFC at many levels. Silence is golden for the the Fertittas when it comes to the UFC, and there's millions of reasons for them to keep most of their financials private. 

This is why no fighter is making a million dollars per bout in the UFC while there are a number of boxers who can command that amount and more.

Interestingly enough, Russell Pike reportedly gave Chuck Liddell a million-dollar contract to pimp Xyience back in the early days of the company. Pike's regime also signed multiple high-caliber fighters to the brand across the MMA landscape and not just in UFC circles.

Despite his criminal tendencies, the company founder made bold moves and laid the foundation for the UFC's current symbiotic relationship with Xyience.

The Fertittas have much more cash at their disposal now as owners of Xyience, but they don't have nearly the same number of talented fighters in the sponsorship stable these days. The Fertitta-owned Xyience also now only sponsors the UFC and their own fighters instead of branching out to other MMA leagues and sports as Xyience did in past years.

The little people in the UFC to the Fertittas are the fighters, even though many of the men and women fighting for the top dog in MMA become fiercely loyal to the Zuffa, LLC organization. Few fans and media professionals realize that this is a conditioned response.

The Fertittas and Dana White fostered a leadership environment leading to a whole new class of obedient fighters who rarely rock the boat or call out their bosses for any reason at all.

Over the next ten years as MMA athletes who fought the bulk of their careers for the UFC are retiring, we may begin to see the real toll a UFC career can have on a fighter's health. By then it will be too late for the fighters suffering from the worst symptoms to negotiate for a higher per-fight pay or a piece of the royalties the UFC makes off their past fights and likeness rights. 

It's time for the truth to trump the lies. It's time for people to realize the Fertittas built their success off the backs of better men and women than themselves. These silver-spoon-fed brothers are much worse than whoever is responsible for JP Morgan Chase's $2 billion miscalculation the FBI jumped all over recently.

Why aren't any federal authorities taking a harder look at the tactics these billionaires are using to continuously get away with ruining the lives of average Americans who get duped into backing these economic hitmen? 

In reality, Bernie Madoff and Wall Street's worst scam artists are not nearly as bad as the combined negative force of the army of financial wizards in this country like the Fertittas who get away with fraud considered to be legal (or only borderline criminal) and only subject to civil penalties. And those civil penalties only apply if those damaged by the fraud can afford the world's most fantastic lawyers.

Paying law firms to cover up their worst behavior becomes cheaper for businesses and billionaires than it would cost to do business the right way: with respect and responsibility.

The roadmap to riches for the Fertittas ripped apart the lives of regular folks from all walks of life, from firefighters and teachers bilked out of retirement funds, to Xyience investors who had their shares wiped out due to Fertitta greed, to all the fighters the UFC chewed up and spit out for not fighting up to the big dog of MMA's standards.

Don't believe the hype and never forget the people who bought out and rebuilt this league will take care of themselves first and screw the little guy any chance they get if it can make them an extra buck by doing so.

The Fertitta family's Galveston gangster ancestors would be so proud to see what kind of corporate crooks these grown brothers have become. 

Settling For Nothing: Fertitta Enterprises Gets Off With Slap on The Wrist For Bankruptcy Fraud

By: Rich Bergeron

      It always amazes me to see how much history repeats itself. Nearly the same scene that's depicted in the photo above unfolded at the Fertitta-owned Red Rock Resort and Casino recently. This time around, the banquet featured the entire current crop of Xyience employees celebrating a new settlement agreement to end the company's bankruptcy battle with the trustee's counsel Jon Backman.

    The settlement is disappointing when you look at how long the proceedings dragged on and how much promise there seemed to be in taking the Fertittas to trial. My own relationship with Mr. Backman was sometimes contentious. I often asked him what could be done for the shareholders.  He always told me they would probably recover very little or next to nothing. I pressed my own motion to suspend the bankruptcy before Backman took the case on for Trustee David Herzog.

     There were times Backman seemed to be doing whatever it took to seek justice while at other times I saw the stereotypical lawyer in him. Eventually I grew to understand he was in a tough position, but he amassed a catalog of evidence that began to build momentum leading up to the trial. He won a sanctions motion that he now has to scrap his rewards for to get a lowball settlement approved. Apparently, Backman didn't want to take his chances fighting the case in court, and he eviscerated his chances to prove that case in the settlement motion.

     Reading some of those sentences came as a real shock to me. The language had the tone of someone writing with a gun to his head. I attended a hearing in Las Vegas where Backman wiped the floor with his opposition: Attorney Greg Garman. The tide seem to be turning in the case, and my own experience with Garman led me to believe he really had no idea why his clients should have to pay for stealing the company out from under the shareholders. He knew the law, but he he didn't seem to know the case that well. He certainly didn't grasp the real circumstances that made this bankruptcy a borderline criminal conspiracy.

     Paying out anything to the trustee came at a price for the Fertittas, I suppose. I wouldn't doubt the negotiations featured discussions on how the settlement motion would be written to absolve the Fertittas and their employees of all possible implications of guilt or culpability. Just like the gangsters in suits depicted in the photo above, the Fertitta brothers have to appear respectable and spotless in the public eye while running their rackets behind the scenes.

   Mr. Backman seemed ready for trial recently, and he let me know at one point that I'd probably read about it in the papers before he could tell me how it was going. He didn't quite get that one right, because I'm the one writing about what happened rather than reading about it anywhere. If I weren't around, the Fertittas might have slipped this one right under the radar. That's unfortunate, but it's the world we live in. Thanks to people who continue to look the other way and let crooks be crooks, crime really does pay for gangsters in business suits these days. Just take a few hours and sort through this blog someday. Research the Fertitta bloodline. 50 cent was over at Floyd Mayweather's gym Tuesday being a ham for the cameras, but if he really wanted to find out how to be a gangster he should have been talking to Lorenzo and Frank Fertitta III. From their machine gun-toting security details to their stubble-ridden tough-guy mugs, these guys are the picture of organized crime in Las Vegas evolved to a totally new dimension.

   It really is depressing to see a company stolen right out from the investors who built it, but even more disgusting is how the Fertittas are planning to fold Xyience into Zuffa. They are literally and figuratively driving it like they stole it.

Russell Pike (parody)

     The company's current PR staff even made it a point to disavow any connection to the company's original founder, Russell Pike, when Pike was recently convicted of Tax Evasion to the tune of owing an estimated $1.5 million to Uncle Sam. Pike will be sentenced in July. By then, the Fertittas will be making millions emulating his original model of doing business: sponsor the UFC's fighters and the UFC to sell more low-rate supplements and other assorted overpriced items. The only thing they didn't do that Pike did was seek investors. The Fertittas and their insider friends wanted all the spoils for themselves. The UFC brass wanted a supplement company tied to the organization for a long time. Now they have one.

Xyience "Round 2" will flash the new marketing model at us all on free television soon by posting the Xyience logo back in the middle of the mat once again on May 5th for the UFC on Fox 3 card. It will be the first time the company's held that position on the mat since I helped expose how the Fertittas created a false bidding war for the middle of the mat space. Xyience defaulted on a multi-million dollar payment plan for that ad space while they were steaming toward bankruptcy, and the Fertittas had to know the company couldn't meet the terms of such a deal when they put ink to paper on it.

Money coming out one Fertitta pocket and going back into another would be a common theme through the case, and I kept finding new areas where the Fertittas found ways to pay themselves without any intention of their moves ever being made public. Yet, even when I exposed much of this behavior, they managed to get away with it all and did not even have to suffer a real civil penalty. These guys have become the kings of insider dealing, influence peddling, and lawyering up to beat the band.

      Lorenzo and Frank Fertitta managed to erase billions in Station Casinos debt through the bankruptcy courts, and they bought all their over-leveraged properties back for a bottom dollar bid at the tail end of the process. They used Xyience as a trial run, an experiment of sorts. It wasn't long before the lesson learned came to be: bankruptcy can be extremely profitable if you play the game correctly. I arrived in Vegas on my last trip out during a time period where Station Casinos was still on the way out of bankruptcy. They were advertising a car a day give-away. Later on I read some reorganization paperwork that showed Station Casinos simply defaulted on the payments to the dealerships involved. The dealerships no doubt wrote off the losses as part of their insurance program, and the folks with the free cars made out like bandits. It's the kind of magic that can only happen in Las Vegas.



This is why the Fertittas themselves are very rich individuals who always make the Forbes list. This is what business-suited gangsters do. There's nothing better than selling something you got for free. As casino owners, the Fertittas must maintain a resolute appearance as upstanding young men who are law-abiding citizens. Billions of dollars could literally be at risk if they were ever caught up in any kind of criminal charges. Bankruptcy fraud seemed like a fair charge when I first levied it against them with a motion to suspend the bankruptcy. Their juice and my lack of an attorney led to a judge paying my motion no heed. The Fertittas steamrolled the company through bankruptcy with relative ease. It was like a bank robbery broadcast on national television where a million tips come in because everyone knows the robbers. Yet, nobody gets cuffed in the long run. Nobody is told to pay for their transgressions or provide any relief to those who suffered through these long years hoping something tangible would come out of the court process.

 I currently have a motion seeking $150 million in relief for sanctions against a wide array of parties implicated in the bankruptcy. There has never been an appropriate hearing on that motion, and it would require a ton of testimony to do it right. It's not a task I take lightly, and it would be a gargantuan effort to bring that hearing to fruition. Still, I am determined to do what it takes to play my part in this and provide whatever shred of justice I can.

Xtreme, Xplosive, Xtensive New Developments

By: Rich Bergeron

The X-pense report is going to be huge on this one. Lawyers will be crawling all over the Matrix. The situation at Xyience is becoming more concerning lately. The Usual Suspects are spawning new usual suspects. The con is cloning itself. I have more ins than ever.

I'm doing some digging and coming up with nuggets of gold. I'm freaking out upper management with my bold approach to fact finding, but the truth is an incredible thing. The more they crack down, the larger the cloak of secrecy over future communications becomes. The best information comes by way of secret transmission.

Lawyers come and lawyers go. Maybe a case of theirs lives on if they're lucky. Storytellers and writers always live forever, though, as soon as their work goes to print. The muck is thick, and it must be raked from time to time. I try to rake with as much tact as possible, intermingled with as much independence as the law allows me to exercise. If history repeats itself, I'll have to rake a lot more. It's what I do. Stay Tuned!

FERTITTAS ROAD TO BUYING THEMSELVES OUT OF BANKRUPTCY PAVED WITH BAD INTENTIONS

By: Rich Bergeron

(at left, boys will be boys..Dana White stands in the middle of the two Fertitta Brothers in their younger days. The picture on the right is from a groundbreaking ceremony, and the labels printed on the photo should be reversed)


Las Vegas truly seems like the picture of luck and promise for visitors who flock to this mecca of over the top celebration hoping to hit it big or at least come home happy. As our nation is crippled piece by piece by massive fraud and failure of proper government oversight, a place like Vegas can easily get lost in the mix. It's not so appealing anymore now that most of us can see the whole "game" is rigged simply by observing our surroundings. It's all too easy to look around and get disgusted at the excess in a place like Vegas.

The housing crisis hit Vegas hard, especially when the economy soured and people stopped coming out there and taking such lavish vacations. Even the President of the United States, Barack Obama, was telling people at one point not to blow it all in Vegas.

The Fertitta family gambled hard and fast with Station Casinos on what is called "the locals market" and lost more than a bundle. Perhaps it is a bit of Karma for all the honest folks who lost their shirts in Fertitta casinos over the years. Possibly it could be chalked up to bad luck or a lack of foresight.

Or... maybe the more feasible and probable explanation is the Fertittas and their front men and lawyers did it all on purpose. They orchestrated a bankruptcy to purposely favor their position and buy the company back debt free and scare off other bidders by their sheer ability to make impossible deals possible.

It's not so far fetched, is it? Vegas is--after all--a city where the mayor is working to build a Mob museum out of an old courthouse. When a guy like Oscar Goodman, a former Mafia lawyer himself, is running "the show," it's hard to believe everything's not rigged toward the wiseguy blood in town. One of the questions that seems pointless to ask these days is, "Where's all the money really going?"

It's just becoming increasingly harder to track and regulate where and why money gets thrown around by these professional corporate crooks who have insulated themselves with vast resources and smart attorneys who know how to get around the bankruptcy courts and keep their bosses out of getting splashed with any real hot water.

Guys like William J. Bullard become untouchable after figuring out how to get through all the loopholes and sneak past regulators looking the other way. As long as the tax money and campaign contributions are flowing out, the investigators aren't looking into the Fertitta Enterprises affairs.

One of the most troubling aspects of my investigation into Fertitta Enterprises is how little there is regarding public information about what this company actually does to make all that wheel-greasing money. A look back into some INTERESTING CASE FILES of another bankruptcy process Fertitta Enterprises is involved in reveals that Fertitta Front Man William J. Bullard was implicated in some interesting claims in a massive bankruptcy of a group of companies under the USA Capital label. Bullard is connected at the hip to the Fertitta family, having common connections to Gordon Biersch, Fertitta Enterprises, Meadows Bank (Where he is ironically the "Whistleblower Contact"), and two older businesses listed on corporationwiki.com:

Inspectech Corporation of California

Tex-Wesley Clear Creek, L.L.C.

Crooks are by nature egotistical and arrogant people. The worst crooks can be the most likely to really add insult to injury with their crimes. They do this not only by way of the sheer magnitude of the crime itself, but also by the very methods and names they use to keep the whole matter secret. Consider the "USA" connection between two groups Fertitta Enterprises and Bill Bullard worked their financial fraud through over the years. Global Cash Access (GCA) Executives were heavily involved in the Xyience bankruptcy scandal. Fertitta Enterprises officials, under the guise of a subsidiary named Zyen, LLC, utilized Global Cash Access money and some of that scandal-ridden company's principal players to perpetrate the whole fraudulent Xyience bankruptcy process from top to bottom.

One of the earliest legal problems the co-founders of GCA faced were related to companies like USA Processing and EXCLUSIVE USA MARKETING CORPORATION.

GCA Founders Karim Maskatiya & Robert Cuccinotta, Former CEO Kirk Sanford, Executive Kathryn Lever, and Maskatiya's Nephew Omer Sattar are the known Global Cash Access plants put in place at Xyience to purposely bankrupt the company and funnel all the money to Fertitta connected companies like Zuffa, LLC and Zuffa Marketing. Kirk Sanford told me himself in a November, 2007 meeting in Times Square (see photo below) that Maskatiya had a considerable amount of money invested in the Fertitta lien position over Xyience.


The major connection Global Cash Access has with Fertitta Enterprises is by way of their contract to provide kiosk and transaction services to station Casinos. This is what likely put the Fertittas in touch with GCA's executives and officials in the first place.

Looking at the emerging pattern of fraud, analyzing the complicated nature of the involved transactions, and taking into account the overall landscape in Vegas that allowed this corruption to go on unchecked, it is easy to see why the Fertittas and their front men and women continue to escape culpability and accountability for orchestrating these massive fraudulent schemes. Nobody has the budget to face them in court and win, and not even the government's best investigative agencies seem willing to try to go the criminal route. The reason doesn't appear to be lack of cause as much as it seems to be about cold hard cash. The city of Las Vegas and the State of Nevada are getting their take six ways to Sunday, and so is the U.S. Government on casino, property, and income taxes paid out by the Fertitta family and their business interests.

But, the question must be asked: WHAT IS THE PRICE OF ALLOWING THIS FRAUD TO KEEP GROWING BIGGER? Do we have to let the Fertittas turn into the next Bernie Madoff before we throw the full weight of criminal charges at them? Their "bull"dog William J. Bullard should be using his financial talents to solve complicated financial crimes. Instead, he and the Fertittas have masterminded perpetrating them under the radar and behind the scenes without ever being called out by the major local press. They do direct business with the Vegas Media Magnate Greenspuns through Green Valley Ranch and Meadows Bank. They have literally covered every base but one.

A blogger with a clear conscience and a bit of talent in getting the facts out of a dedicated investigation came along and did what nobody else had the stones to accomplish and fight for.

I learned that justice is not simply a word or a concept. It is something you must believe in and strive for every day in a society that is trying to keep you from obtaining it if it means pissing off the haves in favor of the have nots. The who cares line gets tossed out there all the time like the first pitch at any big baseball game: ugly and off target.

Who cares? For one, you should if you are a true fan of mixed martial arts. Do you really want the kind of people who systematically take over and cripple companies after promising to invest in and take care of them to be ultimately in control of the best MMA league in existence? This UFC deal is "their thing" and they have some bondholders they have to pay back over the long run, but it's going to make them rich and the fighters poor after all is said and done. They put too many fighters out of business for too long when PRIDE collapsed, going down in history as just another Fertitta company destroyed with a principal purpose of picking up the best pieces and pissing away the rest.

Do you really want the kind of guys who would pay themselves with money pumped into Xyience to the tune of millions of dollars and neglect to square up with their own fighters under contract with the brand? The best warriors in the business should be making millions, and often they make pennies compared to the hours they have to put in to be in prime condition to fight. They rely on their best sponsorships at times.

The Fertittas had outstanding contract payments owed to UFC fighters sponsored by Xyience of less than a million dollars when they bankrupted the company as the chief lienholder. Why didn't they pay their own fighters who literally shed blood for the brand? All the Fertittas ever did for the brand before they destroyed it and took it over for themselves was front it with some ad space on the octagon, make their fighters accessible to sponsorships, and associate it with the rise of The Ultimate Fighter show on Spike TV. The fighters did the real work in promoting the brand. Yet only one old-regime Xyience fighter is back with the newly-branded Fertitta outfit. Matt Serra. Why? (Search this blog for Matt Serra)

The time has come for some light to be shed on this corruption and some action to be taken by the general public. If you agree with me and have your own examples of "usual suspect" fraud that's being overlooked, please Report Waste, Fraud, Abuse, or Misconduct Here.

The Fertittas are about the buy their own casinos out of bankruptcy on a budget of nearly a billion dollars built on what appears to be scheme after corrupt scheme and ruthless business practices that take advantage of the bankruptcy process and subject far too many innocent Americans and taxpayers to footing the ultimate trickle down bill. It starts with the huge investment banks. These institutions eventually pass the expenses on to the little people through overdraft and transaction fees to catch up on all the revenue they've lost hiding their transgressions and trying to avoid being prosecuted for financial crimes.

Why should we be surprised that the economic outlook is gloomy right now in America when we let financial fraudsters like this stay in control and out of jail for so long? As the Fertitta Family pumps hundreds of millions of dollars into getting a relatively debt free casino package out of a nearly 6 billion dollar and ballooning debt debacle with Station, another old associate is going down for 8-12 years in the penitentiary. Bill Bullard was a gung-ho pit boss type of mover and shaker for the company Joseph D. Milanowski drove into the ground. His scheme with one loan in the ongoing bankruptcy case of USA Capital prompted the lawyers explaining it to draw up a diagram:



So right now one lone wolf at the tip of this iceberg gets captured and caged for a while, but the rest of the wolves get to go right on running with the pack and wreaking havoc. Station Casinos is set for auction on this fast-money-first-Friday in August, and the Fertittas are poised to put in a bid as high as $772 million according to the Wall Street Journal.

Is it any coincidence that just as the Station Casinos auction closes leaving the Fertittas virtually free and clear of all the fraud that got them there, Joe Milanowski will be settling into his cell
after having a wall of bars closed on him?

August 6, 2010 could possibly be the day the Fertitta brothers make the deal of the century for themselves. This auction is paving the way for them to become even richer in the long run if they play their cards right and nobody outbids them. August 6th could potentially be the best day of the Frank Fertitta III and Lorenzo Fertitta's young business life, but it is sure to be the worst day of Milanowski's entire life, and he had to pay nearly $90 million in restitution to boot.

Instead of raising champagne glasses to toast yet another successful scheme when they steal their company back from the bottom of the cliff of debt they pushed it off, the Fertittas should be in their own bunk bed unit across from Milanowski. Bullard should be in the bunk above Milanowski. Maybe like Tyco's Dennis Kozlowski does now, they can do something constructive like teach their fellow inmates how to get their GEDs.

Here are some interesting links on Milanowski worth looking at and asking yourself why the Fertittas and William J. Bullard aren't implicated anywhere in this mess even though the civil charges implicate them as such a major player:

MILANOWSKI PLEADS GUILTY

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 20536 / April 23, 2008

SECURITIES AND EXCHANGE COMMISSION VS. JOSEPH MILANOWSKI COMPLAINT


ACCUSATIONS OF FRAUD, SECURITIES VIOLATIONS: SEC sues ex-USA Capital President

AND WHO GOT RICH WITHOUT SHARING ANY ACCOUNTABILITY WHATSOEVER???

THAT'S RIGHT F#*KIN' LAWYERS!!!

"The longer this thing goes on (in bankruptcy court), the more the attorneys are going to get paid," Bullard said.

USA Capital investors fret over rising legal fees

STATION CASINOS, FERTITTA ENTERPRISES, KIRK SANFORD AND A BUNCH OF ZEROES

By: Rich Bergeron

It's been a while, but I created this nice new blog and wanted to formally update the Xyience saga. Right now there has been no action in my own legal matters in the adversary case in more than 6 months. I'm preparing a few filings of my own to change that.

Meanwhile, I've been reading up on what's going around about all the old "Usual Suspects." While the UFC is seemingly still doing smashingly well, Station Casinos is facing resistance from all fronts. Whether it is the culinary union with a bone to pick (pun intended) or the company's major creditors, adversaries and critics are popping up everywhere to claim the casino chain is being shady. Just check out a few of these links if you don't believe me:

NATIONAL LABOR RELATIONS BOARD COMPLAINT AGAINST STATION CASINOS AND OTHER FILES
Station Casinos bondholders renew interest in suing over deal
Propco/Opco: Playing With the House’s Money?
Bankrupt Casino Goes On With Fireworks as Usual

This is just a small sampling of what I've been reading out there about Station Casinos and the "stalking horse bidder" ploy the Fertittas will use to get the best out of this deal at auction, just like they did for Xyience.

Consider this: When Xyience went bankrupt there was a stalking horse bidder for that company, too. What was that company's name???

GOOD THING THE INTERNET REMINDED ME IT WAS MANCHESTER CONSOLIDATED CORP, WHO "bought" THE COMPANY FOR $15 MILLION.

Over the course of the bankruptcy there were a lot of name changes. The company that was the chief lienholder of Xyience going into the BK process was a company dubbed Zyen, LLC when Fertitta Enterprises General Manager Bill Bullard signed the paperwork in 2007. When Manchester walked into the picture, the name became MANZEN. Then it appears Manchester's backers defaulted on the purchase, so it looks as if Fertitta Enterprises, through Zyen, LLC outright owns the company now. Check out these listings from the Nevada corporate entity search engine:

http://nvsos.gov/sosentitysearch/CorpDetails.aspx?lx8nvq=2ryhJA1g38vr4wHvjZ4vJA%253d%253d&nt7=0

http://nvsos.gov/sosentitysearch/CorpDetails.aspx?lx8nvq=N2lDhJztZVB8V0F%252bccSz1w%253d%253d&nt7=0

Gordon and Silver is Gregory Garman's firm. Garman (image below) is the main attorney in my case for Fertitta Enterprises:



"Manzen" only has one manager now: Zyen

And who manages Zyen? BILL BULLARD AND FERTITTA ENTERPRISES:

http://nvsos.gov/sosentitysearch/CorpDetails.aspx?lx8nvq=w2mQRKtvYIQG5%252bRhxnaqMA%253d%253d

Meanwhile, Xyience is accordingly in "default."

http://nvsos.gov/sosentitysearch/CorpDetails.aspx?lx8nvq=n5MCm0RnmZ2bAWvCkO5bRg%253d%253d

What now looks obvious on paper should have been so obvious from the beginning when I was trying to warn of the conflict of interest involved in the Fertittas owning Xyience. I tried to stop the bankruptcy process before it got too far underway, but at that point I had too little legal experience. Still, my Motion to Suspend the Bankruptcy is true Nostradamus-quality stuff looking back now and comparing it to a more experienced legal mind's take on things.

The Fertittas always hid behind a smaller, more obscure company to do their dirty work with Xyience, but now it's clear who owns everything. The fog is clearing, and the fraud will be exposed in the long run.

Yet, without a few key players like Adam Frank and Kirk Sanford, the Fertittas and their GM William Bullard would not have been able to take control of things in Xyience's darkest hour. Adam Frank signed the bogus declaration that got the whole complaint against me started in Nevada. Frank and Sanford met with me in NYC prior to UFC 78 in Newark, NJ. This was after we had this conversation:

CLICK HERE TO LISTEN TO XYIENCE Co-CEOS ADAM FRANK AND KIRK SANFORD TELL RICH HIS WEB-SITE IS A GREAT RESOURCE ON XYIENCE

Sanford and Frank both pulled off crucial moves that helped sink any hopes the shareholders had of retaining any interest in the company after the Fertittas put their cash in. Frank seemed fully aware of the "Scorched Earth" policy advocated by Sanford and discussed at length during our meeting in Times Square back in November of 2008. Someone on the inside at Xyience found out about my meeting and sent me series of emails that broke the case wide open for me, detailing how plans were made to destroy the company piece by piece. I was bombarded with emails warning me about Frank and Sanford's master plan when I got back from the UFC trip. These dispatches had plenty of facts and insider information exposing the ongoing fraud. Tracing the motives of the main parties who perpetrated it all became much easier over the next few months.

Eventually Kirk Sanford's troubles at his former company, Global Cash Access, would become public knowledge when the Arizona authorities issued a scathing report about the company's troubled past with "mis-coding" issues related to credit card transactions and commissions owed to casinos that were never paid. So, it seems Sanford and his friends were bringing too much heat. Those still close to Sanford that still remained had to be ousted.

Then, Sanford set out to create a new GCA called "Sightline Payments." Here's an interesting advertising post for the company: Sightline Payments: Bunch of Zeros.

Well, I know they've got at least one zero, and his name is Kirk Sanford. He is a slick scam artist who is pegged accurately in circulating complaints about his character outside of the Arizona report. He even went as far as acting like an outsider looking in on the fraud parade he was the grandmaster of at GCA. He actually turned around and filed a ridiculous multi-million dollar lawsuit against his former employer. He claimed GCA's promise not to do business with Sanford and his friends was done as a deliberate attempt to smear his name so as to hinder him from developing a competing company. As if Sightline was going to sprout up overnight into a multi-billion dollar conglomerate? What dream world is Kirk Sanford living in, or what drugs is this guy on?

Kirk Sanford and his crooked track record would have been exposed one way or another, and GCA's willingness to distance themselves from him wasn't the only nail in the coffin. There's a thing called Google you might not be aware of, Kirk. Do a simple search for Kirk Sanford on any search engine. How far do you have to go to find links to his whole fraudulent history? And that's not even giving any creedence to the gossip saying he's a drunk to boot. I suppose you have to drink a great deal of alcohol to be so completely dishonest and deceptive to such good people.

The depth of that kind of conniving is really astounding to me. It's been such a long and painful process to prove everything, but it's all there now in the public eye. Yet, still, people like Kirk Sanford are able to go on and do business like nothing ever happened. Fertitta Enterprises is able to waltz right in and take control of Xyience, the company that sponsors their cash cow: THE UFC. They're able to claim bankruptcy even though the family itself is worth billions. The Fertittas are meanwhile still flying on their private jets, enjoying their lavish lifestyle, and filling up their deep pockets any way they can. The Fertittas found a way to cash in on bankruptcy with Xyience, and now it's obvious that they are trying to duplicate that whole process with Station Casinos.

When will justice be done? What will it take for a wise judge to step up and say enough is enough with this scam after scam mentality? How many people have to be hurt in the long run before the corruption stops?

When the wheels are greased, they don't squeak. Something tells me the Fertittas can be true bastards all their lives. They get a free pass to never be held accountable for their ruthless business practices. Just the mantra of their mob association and lineage is usually enough to keep them safe from getting truly busted. Nothing will get in their way, and they will envision and execute larger schemes that screw more people. It's inevitable that greed and power corrupts, and this is one brotherhood that is built on greed.

Perhaps the only saving grace in the long run will come when some of their fortune has to be handed back over to the victims they swindled to get it. The 18th of July, 2010 marks the 3rd anniversary of the initial filing of Xyience's $25 million defamation suit against me. I've done a lot since then to fight back and fight for the shareholders who lost family trust funds, college funds for their kids, and retirement income they needed to stay afloat. I've done my best to keep telling the story and keep fighting the legal fight no matter what. It's been a while, and I've had a bit of a break from it all, but now I'm back, and I'm not letting up until the job is done on all fronts.

AMENDED XYIENCE TRUSTEE COMPLAINT

Xyience, UFC and Zuffa Connection Exposed With Trustee Complaint in Nevada BK Court

Xyience Temporarily Taps Out

XYIENCE FILES FOR BANKRUPTCY

By: Rich Bergeron


Over a month before it became official, Fight News Unlimited reported that bankruptcy was imminent for Xyience. Our article entitled THE ENRON OF MMA exposed some of the reasons why the company is in such dire straits, but the Las Vegas Review Journal dug a little deeper this week and examined the actual voluntary bankruptcy filing Xyience went forward with last Friday.

The official filing comes after an involuntary bankruptcy petition was filed on behalf of several investors tied into a lawsuit against the current Xyience regime. The petition, filed January 3rd, calls into question the Fertitta Enterprises loan and would essentially block any attempted foreclosure by the current controlling interests, and place all the assets under the court's discretion until the fight over the company is finally decided. Zyen, LLC, the company designed by Fertitta Enterprises to handle the $12,000,000 loan given to Xyience last year, filed a NOTICE OF STRICT FORECLOSURE late last year that allowed for only a 90 day window for investors to mount a fight for the company.

The LVRJ Xyience Bankruptcy article, now being circulated across the on-line MMA news landscape, dropped some major bombshells. Yet, there were some major inconsistencies that went to press in the piece, and the overall tone was extremely favorable to the current regime that is attempting to lock out hundreds of the company's initial investors.

One of the most outrageous misrepresentations of the facts reported include the following passage in the article:

"Sattar said the bankruptcy became necessary when the company was unable to raise $7.5 million more from shareholders."

This quote, coming from the lips of the company's newly-crowned president Omer Sattar, is a blatant misrepresentation of the actual situation that gave rise to the bankruptcy. Before Fertitta Enterprises provided loan capital to Xyience, a letter went out by email to a large group of shareholders telling them that if the deal was not ratified the company would go bankrupt. Once the deal was approved by less than half the shareholders, much of the Fertitta investment went right back into a hefty three-year sponsorship extension with the UFC and also helped to pay off past due sponsorship fees of approximately $6.5 million. According to the Las Vegas Review Journal the Fertittas put almost $18 million in total capital into Xyience, and a hefty chunk of that money came out of one pocket only to go right back into another, since the Fertittas are 90% owners of the UFC. Essentially, Xyience would have had double what they needed to stay in operation if they opted not to be a UFC sponsor this year to the tune of $15 million. Even with the extension in place the latest UFC sponsor (Harley Davidson) bumped Xyience from the center of the mat, and now it appears the company paid an absolutely ridiculous price to have their name on a couple cornerpads of the octagon.

The Las Vegas Review Journal is either guilty of extreme bias or sloppy reporting. Don't expect any follow up stories to question any move the Fertittas make. First of all, the Las Vegas Review Journal is partnered with The Las Vegas Sun, which is owned by the Greenspun Family. The Fertittas' Station Casinos partnered with the Greenspun Family on some notable casino developments. Aliante Station and Green Valley Ranch are both joint operations put together by these two major Vegas movers and shakers.

The Las Vegas Review Journal appears to be providing aid and comfort to their business partners in their latest struggle to save face on Xyience. The LVRJ even quoted Sattar's claims of death threats issued to Xyience officials without even contacting either of the men who reportedly made those threats in order to get a response. Ric Klingenberg was accused of making the threats along with his brother David Bergstrom. The dispute arose over a payment owed to Klingenberg's elderly mother, and both brothers were reportedly given the run around while trying to secure a check for $20,000. Reached by phone recently, Klingenberg categorically denied the description of the events Sattar presented in the voluntary bankruptcy filings.

"I went to that office, that part's true, but we didn't storm in there," said Klingenberg. "And we didn't threaten anybody's lives. We did go in and close the door, because, isn't that what you do when you have a meeting?" Klingenberg said Xyience CFO Michael Levy promised him his mother would get paid when the Fertitta Enterprises loan came through. He also said he left Levy a phone message telling him when he would be there to collect the check. Levy reportedly told Klingenberg his mother "was going to have a Merry Christmas" in late December.

"Voices were raised, and everyone was talking at once," said Klingenberg. "We were told to go find Adam Frank, because he was the only one who could authorize a check." He was later told he'd need to get an attorney in order to collect the funds.

Klingenberg also claims that Sattar lied as far as the bankruptcy. "They didn't file bankruptcy, we did," he said. Klingenberg's family trust is the main plaintiff in the investor suit under which the involuntary bankruptcy petition was filed. He explained that the company's hand was forced by their initial filing.

In the aftermath of the bankruptcy announcement, it now appears the bad press and the legal battles mounting have forced the company to now explore the possibility of selling the whole operation. A follow up article in the LVRJ reports that financing has been approved to help position the company for a sale even while the legal battles for control of Xyience rage on.

The Fertittas have not provided any published comment on their tactics regarding Xyience, leaving President Omer Sattar to provide the company's perspective to the public. Sattar is part of a group that came in to run Xyience from a company called Global Cash Access. Questions surrounding insider trading charges and a late filing of GCA's third-quarter report for 2007 followed the departure of the GCA contingent that is now operating Xyience. GCA's stock plummeted in November of 2007 and has yet to completely recover. Station Casinos was one of GCA's largest accounts, so it appears that the partnership between former GCA employees and Fertitta Enterprises stems from that initial connection.

Although the UFC continues to operate as the top dog in the Mixed Martial Arts industry, this latest debacle with Xyience and some other recent developments point to a rocky future for the pioneers of the sport. While other leagues are constantly looking for ways to co-promote major events, the UFC continues to refuse to even acknowledge that any other league competes with them. Their lawsuit against Randy Couture is also looming as a large distraction. On top of that, Tito Ortiz is planning to leave the organization after his next fight according to mmapayout.com. While Ortiz has never been one to hold his tongue about his frustrations with Dana White, he has also never been as popular as he is now with MMA fans. As the boyfriend of Pornstar Jenna Jameson and a contestant on the celebrity edition of the Apprentice, Ortiz is at the height of his fame right now. Wherever he goes from here, that league is sure to benefit from his star status while other UFC fighters will take note and might decide to follow his lead when their own contracts run out.

The UFC seems to be having enough growing pains without their principal owners getting heavily involved in a company with such a horrible reputation. Much of the mainstream MMA press reporting on this story of Xyience going bankrupt have just now started asking questions about what's really going on. The question on everyone's mind seems to be: "Why would the Fertittas want to buy into their own sponsor?" We're talking about a huge , profit-driven company here. Fertitta Enterprises is not the kind of outfit you'd expect to touch Xyience with a ten-foot pole. Yet, here they are up to their necks in debt and tied in to the point where they seem to be more willing to cut their losses than actually rebuild the brand. So, what's the motive. Well, you simply have to go back in time a bit to find the answer. We put together an in-depth report over a month ago that outlined how this day would come.

The truth is, the Fertittas never intended to restore the dignity of the company and save the day for the shareholders who built Xyience. If that was their plan, they'd be front and center in the press talking about it. Instead, they're hiding behind straws put in place to act as the fall guys. If they really wanted to clean the slate and keep the company in full operation, they would have tried to secure more financing a long time ago. They would have put the company first. Instead, they immediately signed a contract extension with the UFC as soon as they put their money in. The whole thing just stinks.

This whole bankruptcy fiasco has nothing to do with not having the money to prevent it. If they don't have it, they can certainly get it. The real reason they decided to file bankruptcy is so they can lock out an estimated 380 shareholders who built and sustained this brand even while fraud and corruption were tearing the company apart from within. Just when these folks were told their payday was on the horizon and there could be an IPO as early as this month, these investors are now forced to reclaim their interest in the company through litigation that could last years. Some of them have lost their life savings.

I have run into a lot of MMA fans who read my stories and other stories about Xyience's issues and ask, "Who cares?" They wonder why it's a story at all and who's the victim. The Enron, Tyco, and Worldcom scandals have tempered the American public to such an extent that we seem to expect this kind of back room underhandedness and duplicity. In one case I found a thread where one fan actually praised the Fertittas for the way they rigged their own loan by investing in Xyience.

Yet, there is so much about this story that people should care about. Let's just go back in time again to when Xyience was at the height of its popularity. All kinds of fighters were raking in big sponsorships. GNC agreed to take on a wide array of Xyience products. The Xyience commercials were a viral video hit because of the sexy models drinking Xenergy in them. Hundreds of investors had the feeling that they could depend on this thing becoming really big. Xyience was a big ticket sponsor at a time when fighters were getting paid chump change compared to boxers. Most fighters are still reliant on sponsors, and they will be until the sport gets sanctioned in more states and becomes more of a mainstream draw. In the wake of this huge scandal that now enters Chapter 11 (pun intended), it's clear there's no other sponsor that's going to equal what Xyience was doing in the beginning. Harley Davidson is not out sponsoring all kinds of fighters. You won't find the Lumber Liquidators logo on any fighter's shorts.

The bottom line is a lot of people got screwed so the Fertittas and Dana White could get themselves a fat dividend check. They laid waste to PRIDE first, and now they're focused on Xyience. Every step of the way they've lied to the public about what they were going to do. They said they were going to keep PRIDE going only to let it completely dissolve with no hope for ressurection. Investors in Xyience were told that the Fertitta deal was the only option and they had to do the deal or watch the company go bankrupt. They did the deal, and the company is still going bankrupt. The Xyience mouthpieces working on behalf of the Fertittas said they were going to reorganize Xyience and keep the brand going only to now come out and announce plans to sell it. It's sad that some people out there are willing to chalk all that up as good business sense.

In the end UFC fighters continue to get paid a fraction of what they should for the risks they take. Some great organizations rose and fell because of greed. Honest investors were shafted because the rich wanted to get richer. And we wonder why the economy is in shambles. Look around. People constantly get away with this kind of shady behavior simply because so many of us shrug our shoulders and say, "Who cares?"

As for who's the victim here, it's anybody and everybody who thinks there's nothing wrong with this picture. It's all the folks who choose to look the other way because great fights are still getting made. It's all the legions of brainwashed sheep who refuse to open their minds to the possibility that they're being lied to. It's all the screwed investors and all the fighters being used while their bosses are raking in all the big money. If this kind of behavior is allowed to go on unchecked, everyone loses.