clock menu more-arrow no yes mobile

Filed under:

Investors file suits claiming WWE/UFC deal a ‘sham’ designed to protect Vince McMahon

TKOgrp.com

In SEC filings, TKO Group and its parent company Endeavor have identified Vince McMahon’s continued role in the new WWE/UFC umbrella corporation a risk. It’s not clear how big a risk a recent lawsuits filed against McMahon and other WWE principals by an Ohio pension fund & an individual investor are, but they’re probably among the things Endeavor directors & accountants had in mind when filling out paperwork for investors & the government.

The Hollywood Reporter first reported on one suit yesterday (Nov. 27). It alleges that Vince and other members of WWE’s board “timed negotiations” regarding the sale of the company to favor Endeavor, and pushed for a “quick sale” to McMahon’s “close friend and longtime ally” Ari Emanuel, who leads Endeavor. It argues this “sham sales process” was done to ensure Vince could serve as TKO’s Executive Chairman, and to “exclude other bidders seeking to axe” him due to his recent sexual misconduct & hush money scandals.

Per the suit, McMahon & his allies on the WWE Board ignored better deals — including at least two all-cash offers with better terms — in favor of one with Emanuel who they “knew would allow him [Vince] to remain at the helm” of the merged UFC/WWE.

In naming WWE executives Nick Khan, Paul “Triple” Levesque, George Barrios and Michelle Wilson, the suit alleges that “not only did he secure a future for himself at post-merger WWE, McMahon also stuffed his pockets and those of his loyalists before agreeing to a deal.” The large cash bonuses Khan, Levesque & Frank A. Riddick received upon the closing of the Endeavor deal were also cited in the suit.

Overall, it claims the roughly $9 billion sale to Endeavor was “far below the offers” that should have been considered had McMahon & his team “made any effort to negotiate in good faith.”

Bloomberg Law also reported on a similar suit from Dennis Palkon, a WWE shareholder who sued the company earlier this year over the way Vince forced his return in order to facilitate the sale at the center of his new suit.

TKO & WWE have not responded to requests for comment on the suits.

While there is certainly cost involved in mounting defenses against these and other cases — and possibly to settle them — it’s not clear there’s any existential risk to TKO. A wave of suits filed around the allegations about McMahon’s personal and professional conduct last year didn’t stop his return or the Endeavor deal.

But there is also an ongoing investigation by the federal government into Vince and his dealings, so it’s not a problem that’s completely going away either.

Sign up for the newsletter Sign up for the Cageside Seats Daily Roundup newsletter!

A daily roundup of all your pro wrestling news from Cageside Seats