WWE announced that they’ve settled a lawsuit against them that was filed by the City of Warren (Michigan) Police and Fire Retirement System. The shareholders claimed that WWE lied about their business dealings in Saudi Arabia, causing their stock prices to drop. According to the suit, WWE did not alert the shareholders of their failed negations with Saudi Arabia regarding a new broadcasting deal.
Earlier this month, Law360 reported that a Connecticut federal judge threw out three shareholder derivative suits regarding Saudi Arabia.
The following is from the SEC filing:
On November 18, 2020, World Wrestling Entertainment, Inc. (the “Company”) entered into a term sheet (the “Term Sheet”) to settle the previously disclosed action titled City of Warren Police and Fire Retirement System, individually and on behalf of all others similarly situated, v. World Wrestling Entertainment, Inc., Vincent K. McMahon, George A. Barrios, and Michelle D. Wilson, No. 1:20-cv-02031-JSR, currently pending in the United States District Court for the Southern District of New York (the “Court”). Plaintiffs in the lawsuit alleged securities law violations by the Company, its current Chief Executive Officer and its former Co-Presidents, related to certain disclosures concerning the Company’s business relationship in and with the Kingdom of Saudi Arabia. The Term Sheet was reached in connection with a voluntary mediation which involved the Plaintiffs and their counsel, the Company and its counsel, and the Company’s insurance carriers. Aside from the Term Sheet, there will be other standard and customary terms of class action settlements in the stipulation of settlement. The settlement is subject to notice to the class and preliminary and final approval by the Court.
The settlement will include a full release of all Defendants in connection with the allegations made in the lawsuit, and will not contain any admission of liability or admission as to the validity or truth of any or all allegations or claims by any of the Defendants.
The Term Sheet provides for a settlement payment, subject to Court approval, of $39 million (inclusive of all Plaintiffs’ attorneys fees and expenses and settlement costs), all of which the Company expects will be paid by the Company’s insurance carriers.
The Company believes that resolving the matter is the right business decision and that it is prudent to end the protracted and uncertain class action process.
WWE has also made some changes in various departments in their company. Karen Mullane is the new Controller and Principal Accounting Officer and she’s replacing Mark Kowal who was in the position for 19 years. Brian Nurse, Senior VP, General Counsel & Secretary along with John Brody, Executive Vice President, Global Head of Sales and Partnership and Head of International were let go from WWE.