The UFC released a statement on the matter, which said "As announced by UFC president Dana White, the UFC organization has elected to terminate its contract with Rousimar Palhares based on repeated incidents of unsportsmanlike conduct violating the UFC Fighter Code of Conduct and his Promotional Agreement with Zuffa, LLC.
Pierce appeared to tap several times physically and verbally and the ref intervened physically before Palhares let go. Despite being the only submission win on the card, Palhares was denied the Submission of the Night bonus. Managing Director of International Development Marshall Zelaznik announced at the post-fight press conference that the local commission would be investigating the length of time that Palhares held the submission.
"The controversy is not Palhares' first: In 2010, the New Jersey State Athletic Commission suspended Palhares for 90 days following his heel hook win over Tomasz Drwal at UFC 111 for not letting go after the referee stoppage," the statement continued. "In 2012, Palhares was again suspended for nine months after testing positive for elevated testosterone after UFC on FX 6."
For what it's worth, Palhares' management team apologized for him and said he'll move forward with another promotion.
"I just gave Rousimar the news," Palhares' manager stated. "He was very sad to hear Dana's decision. He is not a bad person or dirty fighter, and he is not trying to hurt people. Somehow, he just doesn't hear or feel things at these moments. He worked very hard to get this far in his career, and he is not going to give up on it. He loves fighting. This is what he does. He apologizes to his fans, and will work hard to resolve these issues and fight in another event that would be interested in having him.
"I can understand Dana's perspective, but I need to reiterate that this kid does not do these things out of maliciousness. The people that live with him and train with him every day love him, and anyone else that meets him ends up doing the same. The UFC is a company and has both the right and the obligation to do what is in its best interest. I, myself, am extremely sad that it came to this, but I will continue to help and support Rousimar in his life and career. He is an awesome fighter by any standards – dedicated, humble and extremely hard-working. He will surpass this bump in the road and continue on with his fighting career."
The UFC clearly made the correct decision by released Palhares, as his most recent incident wasn't the first time he held onto a dangerous submission for too long.
As the old adage goes, "three strikes and you're out."