The settlement dismissing the WWE merger lawsuit still isn’t finalized, more than two months after the trial was cancelled on the last business day before it was set to begin.
WWE parent TKO Group Holdings, Inc. disclosed in its quarterly filing on Monday that “WWE’s portion” of the settlement amount will be $105 million. But, amid a series of letters filed with the court on Thursday night, attorneys for the shareholder plaintiffs say the full settlement amount is $147.5 million. That money will presumably be distributed to those who held WWE shares during a relevant time period that the court approves.
An attorney for the plaintiffs complained to the court that because of TKO’s “partial disclosures” and delays in finalizing the settlement, “the press has now circulated an incomplete picture of the full settlement.”
The merger lawsuit involves two sets of defendants. On one hand is Vince McMahon, who has his own group of lawyers. On the other are the remaining defendants—WWE President Nick Khan, Chief Content Officer Paul Levesque, and former board members George Barrios and Michelle Wilson—whose defense is likely being provided by WWE.
The plaintiffs alleged that McMahon predetermined the merger sale process that eventually created TKO in 2023 and that the other defendants cooperated with him and violated their fiduciary duties. The suit claims this deprived WWE shareholders of a higher, fairer sale price. All of the defendants have denied the key allegations of the suit.
The hold-up is a disagreement between these two defendant groups—at least according to the non-Vince McMahon WWE side. The disagreement involves insurance and indemnification issues, which will bear on who pays how much of the settlement and to what extent the settlement is covered by insurance. The earlier TKO filing already said WWE expects most of its contribution—$75 million of it—will be covered by insurance.
The WWE defendants describe the disagreement as a “narrow” one, though the parties haven’t provided much further detail.
Issues delaying the settlement came to light on July 30, when an attorney for the plaintiffs, Kim Evans of Block & Leviton LLP, filed a letter addressed to presiding judge Vice Chancellor J. Travis Laster.
Discussing the drawn-out settlement process, Evans wrote that the process “has been unnecessarily arduous.” As of the day prior, she noted, attorneys for McMahon confirmed that he was ready to sign off on the settlement. But the WWE defendants “refuse to authorize filing,” even though their lawyers had been participating in editing the written agreement.
Vice Chancellor Laster set a deadline of Thursday, August 6, for the defendants to explain the obstacles preventing the settlement from being finished.
WWE defendants say delay is because of a “narrow disagreement”
An attorney for the Khan and Levesque side submitted a letter on that deadline, assuring that the settlement in principle was still in place.
“The only obstacle to [finalizing the settlement agreement] is a narrow disagreement between Defendants [Khan, Levesque, Barrios, and Wilson] and Mr. McMahon over the scope of releases tied to certain indemnification and contribution obligations between themselves and their insurance carriers,” attorney Ryan Stottmann of Morris Nichols Arsht & Tunnell LLP wrote.
An attorney for McMahon filed a letter about 30 minutes later, confirming that he has agreed to the settlement stipulation the parties have prepared.
“Mr. McMahon sees no reason why any intra-Defendant release should further delay the settlement, and he is prepared to sign the stipulation without any such release between Defendants,” attorney T. Brad Davey of Potter Anderson & Corroon LLP wrote on behalf of the former WWE chairman and chief executive.
The word “release” here might refer to a legal promise that the sets of defendants won’t sue each other over the costs of the settlement.
Davey added that there are no remaining obstacles to completing the settlement, seeming to suggest the issues are on the WWE side.
The letters don’t offer a further explanation of the disagreement. McMahon is alleged to have intentionally made a deal that put preservation of his role in WWE above wider shareholder interests. Stottmann’s statement to the court suggests the issue between McMahon and WWE may be over who pays how much, to what extent insurance covers whom, and to what extent McMahon will be indemnified.
Directors on the board of a company like WWE are often legally protected, or indemnified, against lawsuits. The company promises to provide attorneys to defend the directors if they’re sued, and agrees to pay for any settlements or damages if the directors are found civilly liable. The degree to which McMahon may have been indemnified concerning this lawsuit has long been an unanswered question.
As stated in TKO’s Securities and Exchange Commission filing disclosing what the company says is WWE’s portion of the settlement amount, insurance often pays for the bulk of settlements like these.
Representatives for McMahon did not immediately respond to questions from POST Wrestling asking to what extent McMahon is indemnified by WWE or TKO in this matter or whether McMahon has his own insurance carrier apart from WWE’s insurer.
WWE media representatives also did not immediately respond to a request to provide comments for this report.
Plaintiffs: “Respectfully, this is not our problem”
A few hours after the letter from McMahon’s counsel on Thursday, the plaintiffs came back with another letter, asking the judge to require the parties to sign the settlement agreement by a certain date. The WWE defendants in their letter had volunteered August 28 as a date by which the settlement would either be finalized, or they would update the court about why it’s not done yet.
The plaintiffs’ letter, again written by Evans, states that the defendants’ letters show that there isn’t any disagreement about the language of the settlement itself, only a disagreement between the defendants.
“Respectfully, this is not our problem,” Evans wrote on behalf of shareholders. “Defendants’ allocation and indemnification issues are not a contingency to the agreed-upon settlement that Plaintiffs accepted on the last business day before trial,” referring to the settlement in principle the parties came to on Friday, June 5, just before the trial was scheduled to begin the following Monday.
“Separately, TKO issued a Form 10-Q on August 4, 2026, disclosing WWE’s contribution to the settlement—$105 million,” Evans’ letter continued. “That disclosure failed to disclose the full $147.5 million settlement amount and the remaining contribution allocated to McMahon and/or insurers on his behalf.”
The TKO filing is misleading the public, the plaintiffs say.
Before the settlement in principle was reached, the plaintiffs’ expert witnesses had calculated damages ranging between $466 million and nearly $1 billion.
“As a result of Defendants’ partial disclosures and attendant delays in papering the settlement, the press has now circulated an incomplete picture of the full settlement,” Evans stated. “Suffice to say, Defendants’ continued refusal to execute the settlement stipulation is creating larger problems.”
The judge has not yet responded to the letters the parties filed on Thursday night.
Disclosure: This reporter is currently engaged in his third challenge process in this case, seeking public access to filings and exhibits related to the lawsuit.
