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Week in Review

By Chris Helsel

FIFA Update: President Resigns; Indicted Ex-VP Threatens "Avalanche" of Secrets; Interpol Adds Officials to Most Wanted List

This week, just days after calling himself "the president of everybody" and alleging that the American government's crackdown on FIFA corruption stemmed from resentment from the U.S.'s failed 2022 World Cup bid, FIFA president Sepp Blatter announced plans to resign the post he has held for 17 years.

This news comes on the heels of last week's bombshell dropped by the U.S. Department of Justice, which unsealed an indictment calling for the arrest of 14 individuals connected to soccer's governing body on racketeering, wire fraud and money laundering charges.

This week, the international police force Interpol, based in France, joined the fight by issuing a "red notice," which added six of the indicted individuals to its "Most Wanted" list. Two have already been arrested in their home countries, while the other four now risk arrest anywhere they travel in the world.

One of the men arrested was Jack Warner of Trinidad and Tobago, a former FIFA vice president. Mr. Warner, who faces a raft of charges, including racketeering, bribery, wire fraud and money laundering, is accused of, among many other things, accepting a $10 million bribe from the South African government in exchange for his vote for the country to host the 2010 World Cup (which it ultimately did). Two of Mr. Warner's sons, as well as his former Caribbean, North & Central American soccer federation (CONCACAF) colleague Chuck Blazer, were previously arrested, pleaded guilty, and are cooperating with American authorities.

While denying any personal wrongdoing, Mr. Warner has now come forward and proclaimed that he has intimate knowledge of the deep corruption running rampant throughout FIFA - and that he intends to share it. In a seven minute paid political television advertisement entitled "The Gloves Are Off," the embattled former executive revealed he had a trove of evidence linking various FIFA officials, including Mr. Blatter, to a slew of illicit payments and activities. "Blatter knows why he fell - and if anyone else knows, I do," he said. Mr. Warner declared that he had placed the files in "respected hands" - believed to be those of his attorneys - and promised, "I will no longer keep secrets for them who now seek to actively destroy the country which I love."

In his speech, Mr. Warner also said he "reasonably and surely" feared for his life. However, despite this fear, he vowed to continue naming names. At a rally shortly after his speech was broadcast, he said, "Not even death will stop the avalanche that is coming. The die is cast. There can be no turning back."

In addition to paraphrasing Julius Caesar, the former executive also invoked Gandhi, proclaiming that throughout history, tyrants always fall in the end.

Mr. Warner also curiously accused Mr. Blatter of directly manipulating Trinidad's 2010 government election, for reasons unknown.


41 Charged With Murder in 2013 Bangladesh Building Collapse

This week, Bangladeshi police formally charged 41 people with murder for their involvement in the collapse of a Dhaka building. The building, which housed several garment factories, collapsed in 2013, killing more than 1,100 people. It was the worst disaster in garment industry history.

Following the collapse, a state report found that the building was constructed with substandard materials in flagrant violation of building codes. The report also found that factory owners urged employees to return to work the day after an engineer inspected the building and deemed it unsafe. Specifically, the building's upper floors were illegally constructed, and housed heavy generators that caused the building to shake.

Among those charged were the owner of the building, his parents, several of the buildings' factory owners, and at least a dozen government officials. Those convicted could face the death penalty.

Bangladesh ranks second only to China in worldwide garment manufacturing output, with over 5,000 factories. Workers there earn the lowest wages in the world.


Triple Crown Winning Owner Sued Again, This Time for Libel

Ahmed Zayat, whose horse American Pharoah became the first since 1978 to win horse racing's Triple Crown this weekend, now finds himself facing yet another lawsuit.

Last year, Mr. Zayat was sued in federal court for breach of contract by Howard Rubinsky, who claimed that . Zayat failed to repay a $1.65 million gambling debt. Now, Mr. Rubinsky's attorney Joseph Bainton has brought suit in New Jersey court against Mr. Zayat for libel, alleging that the Egyptian-American thoroughbred owner knowingly made false, malicious statements about him after Mr. Rubinsky's federal suit went public.

According to the suit, when asked about the federal breach of contract suit, Mr. Zayat told the Associated Press: "It's a fraud. It's a scam from A to Z. It's a total fiction. It's a total lie. It is a case of blackmail by a criminal." These comments, says Mr. Bainton, damaged the sterling reputation he has cultivated over the course of a 40-year legal career. The suit seeks $10 million in damages.


Yahoo! Scores Rights to First National Football League Internet Live Stream

Yahoo!announced this week that it had struck an exclusive deal with the National Football League (NFL, league) to host the first free, live global webcast of a regular season game. The live stream will feature the October 25th matchup between the Buffalo Bills and Jacksonville Jaguars in London.

Yahoo!, which scored the deal over more successful rivals Google and Facebook, among others, apparently won over league executives with its connections to advertisers, technical ability to handle the enormous expected viewership and wide reach of approximately one billion users worldwide. Both sides declined to disclose the financial specifics of the deal, but industry insiders believe that the league will receive a seven-figure fee for the rights to air the single game. Yahoo! says it plans to sell video ads and sponsorships around the game, the proceeds of which will be kept by the company.

For the first time, football fans across the globe will be able to watch NFL football for free, with access available via smartphone, computer, video game console and smart TV.

To this point, the NFL has been hesitant to allow its games to be streamed online domestically for fear of cannibalizing its lucrative broadcast television deals. However, if the Yahoo! foray is successful, expect the league to parlay that fact into even higher fees for future television contracts that would include streaming rights.


Abbott and Costello Heirs Sue Playwright and Others Over Use of "Who's On First?"

Broadway hit "Hand to God," which came up empty at the Tony Awards this weekend despite five nominations including Best Play and Best Actor, now finds itself facing a federal copyright suit over its use of the famous Abbott and Costello baseball comedy routine, "Who's on First?"

The suit, brought by the comedians' heirs in the Southern District of New York, alleges that playwright Robert Askins and the show's producers and promoters violated the comedy tandem's copyright by incorporating a portion of the classic routine into a performance by the show's teenaged protagonist, delivered via sock puppet while attempting to woo a female friend. The estate says its cease-and-desist letters have been ignored since the play's Broadway debut in April.

According to an attorney for the heirs, "'Hand to God' is using 'Who's on First' not just to get laughs from the audience but also to get people to buy tickets." A spokesman for the production disputes that timeline, however, and insisted this week that "The lawsuit is baseless; the material in question is in the public domain, and the show's producer carefully vetted" it with the production's lawyers.

Lead producer Kevin McCollum agreed, telling reporters in an email this week: "Filing a lawsuit on the eve of the Tony awards is obviously nothing more than a stunt. Frankly, we welcome the attention."


Online Music Stream Service SoundCloud Reaches Deal With 20,000 Record Labels

The online music streaming service SoundCloud announced this week that it has struck a deal with 20,000 independent record labels through Merlin, an organization that represents small companies in large scale digital negotiations.

The Berlin-based company, which boasts 175 million monthly users, has also recently inked deals with Warner Music and the National Music Publishers' Association, although negotiations with Sony have reportedly reached an impasse. As a result, some mainstream Sony acts have been pulled from the service, including Kelly Clarkson and Adele. Negotiations with the Universal have also reportedly slowed.

Unlike fully licensed operators Pandora and Spotify, until recently SoundCloud lacked formal licensing agreements, and therefore paid no royalties. Predictably, this led to a tense relationship with the music industry, although many artists love the service for its wide reach and easy accessibility. Many, like then-17-year-old surprise 2014 Song of the Year Grammy-winner Lorde, choose to debut new songs on SoundCloud long before selling them through their labels.

Despite its enormous popularity, SoundCloud has struggled up to this point to generate significant revenue through its service. It did not establish an advertising platform until late last year, after which time it has only paid out $2 million in royalties.

This new agreement is seen as a major step towards convincing the industry - Sony and Universal specifically - that SoundCloud can in fact generate revenue for artists and labels alike. According to Charles Caldas, Merlin's chief executive, "For SoundCloud as a business, their relationship with the music industry long term without having some form of monetization would make their future incredibly difficult." Fans of the free streaming music service sure hope it can find a way to do just that.


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This page contains a single entry from the blog posted on June 10, 2015 10:16 AM.

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