WWE Announces Preliminary Court Approval Of Proposed Settlement

WWE has announced the preliminary court approval of a proposed settlement on the ‘investors’ section of its corporate website.

WWE writes:

STAMFORD, Conn.–(BUSINESS WIRE)– World Wrestling Entertainment, Inc. (NYSE: WWE) The proposed settlement of certain shareholder derivative and other actions, previously disclosed by the Company’s Current Report on Form 8-K, filed August 17, 2021, has received preliminary court approval. The proposed settlement includes no financial obligation on the part of the Company. The attached summary notice constitutes a required notice of the proposed settlement.

The initial Form 8-K in question stated:

On August 16, 2021, World Wrestling Entertainment, Inc. (the “Company”) reached an agreement in principle and signed a term sheet to settle the previously disclosed shareholder derivative actions titled (i) Merholz et al. v. McMahon et al., No. 3:20-cv-00557-VAB; (ii) Kooi v. McMahon et al., No. 3:20-cv-00743-VAB; (iii) Nordstrom v. McMahon et al., No. 3:20-cv-00904-VAB; (iv) Merholz/Jimenez v. McMahon et al., No. 3:21-cv-00789-VAB; (v) Rezendes v. McMahon et al., No. 3:21-cv-00793-VAB; and (vi) City of Pontiac Police and Fire Retirement System v. McMahon et al., No. 3:21-cv-00930-VAB, currently pending in the United States District Court for the District of Connecticut (collectively, the “Derivative Actions”), as well as related lawsuits filed in the Court of Chancery of the State of Delaware titled (i) Leavy v. World Wrestling Entertainment, Inc., No. 2020-0907-KSJM; (ii) Dastgir v. McMahon et al., No. 2021-0513-LWW; and (iii) Lowinger v. McMahon et al., No. 2021-0656-LWW (together with the Derivative Actions, the “Actions”). Among other things, the plaintiffs in the Actions have alleged violations by certain current and former Company directors and officers related to disclosures concerning the Company’s business relationship in and with the Kingdom of Saudi Arabia and that certain of these defendants engaged in improper stock trading.

The proposed settlement would include, among other things, a full release of all defendants in connection with all allegations made in the Actions, and it would not contain any admission of liability or admission as to the validity or truth of any or all allegations or claims by the Company or any of the other defendants. The proposed settlement also would provide that the Company will implement and maintain certain corporate governance measures. As part of the settlement, the plaintiffs have indicated an intent to seek payment of their attorneys’ fees, reimbursement of expenses, and case contribution awards, which the proposed settlement provides would be paid by the Company’s insurance carriers. The proposed settlement remains subject to shareholder notice, court approval and other customary conditions. In the event that the parties are not able to cause all of these conditions to be satisfied, the Company and the other defendants intend to continue to vigorously defend against the claims asserted in the Actions.

Although the Company and the other defendants have denied, and continue to deny, all claims asserted by the plaintiffs in the Actions, the Company believes that resolving the Actions in accordance with the terms of the proposed settlement is the proper business decision and that it is prudent to end the protracted and uncertain derivative litigation process on the terms of the proposed settlement.

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