Things have gotten turned up a notch in regards to the pressure on Vince McMahon and the WWE as it’s been reported that five law firms have issued press releases saying they’re investigating the WWE for violation of the securities laws on behalf of WWE Investors.
They Wall Street Journal report last week that exposed the WWE’s board investigating Vince McMahon following news he paid a former employee $3 million to remain quiet after she left the company.
The report stated the former employee, who has not been named, signed a non-disclosure agreement in exchange for the money. The investigation reportedly unearthed similar NDAs over the years as
The investigation includes Head of Talent Relations John Laurinaitis for misconduct, and since then McMahon has temporarily stepped aside from CEO and Chairman with Stephanie McMahon taking over, and Laurinaitis was placed on administrative leave with Bruce Prichard taking over on an interim basis as well.
Actually there are 5 firms with press releases on Business Wire now.
Scott+Scott: https://t.co/y7vwUFWCxq
Rosen Law Firm: https://t.co/qC0Qa7JbXl
Schall Law Firm: https://t.co/CfqmmtEhSu
Brager Eagel & Squire:https://t.co/ivVH2M0Joh
Labaton Sucharow:https://t.co/ejK1JZ9ckU
— Brandon Thurston (@BrandonThurston) June 21, 2022
Possible class action lawsuit and outcome
The five law firms that have joined the investigation are Scott+Scott, Rosen Law Firm, Schall Law Firm, Brager Eagel & Squire, and Labaton Sucharow.
All five firms are reportedly looking for WWE shareholders that have suffered a loss for them to participate in a class action lawsuit.
Since WWE stock has been down overall since the news broke, there are undoubtedly shareholders that aren’t happy at the loss they’re dealing with thanks to the allegations and alleged actions by McMahon and Laurinaitis.
It’s one of the pitfalls of having a publicly traded company as the CEO is at the mercy of the board and shareholders, but McMahon reportedly owns roughly 28.7 million shares of WWE stock (37.6% of total stock), which equates to an 83% voting power for internal matters.
In short, it’ll take a massive push to get him out and keep him out and that would include the SEC getting involved if there’s evidence the shareholders are being criminally abused.
It’s possible, but we’ll have to wait and see how all of the evidence is considered and what else happened with the NDAs.
One thing for sure is this is 2022 and it’s harder for things like this to be buried.
McMahon has never been one to back down from a fight, and his appearance on Smackdown (June 17) briefly to tout the WWE’s opening monologue, emphasizing the “Together” portion and on Raw (June 20) to tout John Cena returning to Raw next week despite it being promoted everywhere.
Time will tell how everything will settle down, and we’ll keep you updated as we learn more.
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