The Corporate Chickens Come Home to Roost: How Vince's Dream May Be His Downfall

Two things have defined Vince McMahon’s professional life, greed and hubris. Vince’s greed for money and mainstream recognition led him to turn his private promotion into a publicly traded company. Hubris, well what else do you call it when a man consistently brags about beating the federal government and operates with a belief of untouchability? When the Wall Street Journal dropped a bombshell that Vince was under investigation people were stunned but not surprised especially with the details of the allegations against him. When the seemingly teflon, notoriously megalomaniacal billionaire stepped away (temporarily) as CEO on Friday people were shocked. Turns out they shouldn’t have been. In a sweet, sweet ironic twist Vince’s own greed and hubris may do what the feds couldn’t, finally end his decades long reign of terror over the wrestling industry.

I’ve written extensively about the corporatization of WWE and the detrimental effects that’s had on the WWE product. One thing even I overlooked was how restructuring the company as publicly traded entity actually made Vince more vulnerable than he’s ever been. When the federal government brought him on steroid distribution charges, the then-World Wrestling Federation was a private business. Vince answered to no one which is why never backed down and more importantly never stepped down even while on trial. Fast-forward to now and Vince McMahon is answerable not to fans of course but to the shareholders, network partners, sponsors, and most importantly the WWE Board of Directors.

Vince’s 80% of the voting shares have always given him the outward appearance of invincibility. The reality though is that Vincent Kennedy McMahon has a contract just like every other executive at WWE. That contract is a byproduct of being a public company. According to the WSJ article Vince is being investigated for a secret $3 million hush money agreement he made with a former employee with whom he and John Laurinaitis engaged in an affair. Furthermore, the article states that the board has uncovered an unspecified number of other NDA's covering similar allegations against McMahon and Laurinaitis. Multiple NDAs and millions of dollars in hush money certainly seems like a pattern of workplace misconduct at the very least. According to point C of the termination clause of the WWE executive contract Vince can be terminated if the board finds committed "willful or material misconduct of his duties…including failure to follow any company policies or directives". I’m no lawyer but these allegations particularly the presence of more NDAs certainly feels like it violates the spirit of that clause if not the letter. Further damning for Vince was a passage from the WSJ article in which it’s alleged that the former employee’s salary was raised from $100,000 to $200,000 when she began having the affair with Vince. In July 2020 WWE updated their corporate code of conduct to include a line specifically prohibiting "the grant or offer of employment quid pro quo for personal intimacy". On its face what Vince allegedly did would violate the code of conduct.

As is stands right now the board appears to have enough evidence to terminate Vince McMahon’s contract. Who knows what else will come to light in this investigation. Not only Vince beholden to the decision of the board but he also has to answer to the shareholders, who have retained their own law firm to investigate whether the board breached their fiduciary duties by not revealing the investigation. He also must worry about those network partners and sponsors. If this situation continues to unravel, they could start to add pressure. That’s why Vince blinked for the first time and stepped down. He knows just how bad this could get. Vince’s is retaining creative control for the time being likely to reassure everyone the onscreen will be uninterrupted, hence his pointless appearance on Smackdown, but his days appear to be numbered. It’s almost poetic that the corporate monster Vince created by recognizing his life’s dream will, in all likelihood, be responsible for his professional demise.

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