Originally published at Legal expert Jason Cruz weighs in on WWE/MLW settlement and Le v Zuffa
It’s been a year of newsworthy legal filings for the leader in professional wrestling. The same year that WWE made the high-profile move to merge with UFC and form publicly traded company TKO Group Holdings, the wrestling promotion also maneuvered its way out of three different high-profile lawsuits.
Just earlier this week, a filing in the United States Southern District Court of California revealed that WWE had reached a settlement with MLW, who just over a year ago began pursuing an antitrust lawsuit.
This news came just months after WWE found its way out of two other legal predicaments. In November, WWE reached a settlement with trading card company Panini, with both parties asking the court to dismiss the action with prejudice. This lawsuit started after Panini alleged that WWE attempted to leave its deal with the merchandising company to start a partnership with Fanatics.
And just three months before then, a lawsuit against WWE filed by former writer Britney Abrahams — who alleged racial discrimination and wrongful termination — was voluntarily dismissed. It isn’t known if a settlement was reached in this instance.
When practicing lawyer and combat sports legal analyst Jason Cruz joined Pollock & Thurston this week, he described the settlement as a major win for MLW, as it allows them to avoid fighting what he saw as an uphill legal battle.
“I definitely think it’s a great result for MLW, simply because in my opinion I don’t think that they had a great case going into this lawsuit,” said Cruz, who is the writer of MMAPayout.com. “If you recall, the judge allowed MLW to amend its complaints to add more context to the lawsuit, which basically means ‘We’re going to dismiss this thing unless you add more meat to this lawsuit.’”
Cruz said that while he didn’t believe MLW had a strong antitrust claim in their lawsuit, their allegation of Intentional Interference with Prospective Business had some strong standing. In the lawsuit, MLW argued that business dealings by WWE hurt business dealings with Tubi, Vice, and FITE. They also argue that an exclusivity deal that NBC’s Peacock network had with WWE for wrestling programming stopped them from airing on Reelz, who made a broadcast deal with them in early 2023. While these were solid claims, Cruz argued that they weren’t enough for an antitrust.
“I don’t know if any of those things would give rise to being anti-competitive. Now definitely [WWE] can have a monopoly and have a strong market share. But, MLW would have to prove more than what they had brought as far as [showing] they did this to everybody.”
If a settlement wasn’t offered or reached, MLW might have been in for a lengthy lawsuit. A lawsuit that would likely take years and loads of money. Cruz mentioned it’s possible that a discussion of settlement was on the table for them from the start.
“As far as the legal representation, you want to ask your client: ‘Hey, how far do you want to go with this? Moreover, do you have the capital to fund this lawsuit through trial?’ Cruz said. “I don’t know how much of a legal budget [MLW] have, but a year and a half in, you worry about how much you’re spending on all these legal bills, and what are you going to gain out of that?”
While WWE is out of the way from any antitrust lawsuits, for now, the merged TKO company still has another to worry about. The Le v Zuffa lawsuit, which argues that UFC kept the wages low of fighters by using anti-competitive tactics, received class action certification this summer. And last month, an appeal by Zuffa for the lawsuit was denied, setting it up for a trial in April.
The class action suit, which seeks more than a billion dollars and represents roughly 1,200 fighters from the years 2010 to 2018, still has the possibility of settling. Despite this, Cruz sees the possibility of the trial beginning likely: “I am very positive that this will at least go to the start of a trial … Unless this thing gets kicked, or dismissed, or whatnot, Zuffa is willing to go to trial.”
Recent details from the discovery portion of the lawsuit have put UFC’s business practices under scrutiny. An investigation by Bloody Elbow showed communications between owners Dana White and Lorenzo Fertitta celebrating “cut throat nasty business” moves by the promotion.
Cruz pointed out that while this information is publicly known, people should remain aware that it has not been used in trial yet.
“There’s a lot of salacious emails and texts that have come out,” he said. “The question is, will any of this see the light of day in court? Because a lot of this information that will be submitted will be objected to by Zuffa as far as what evidentiary rule will allow.”
Despite Zuffa likely heading to trial soon, the stock of TKO has not taken much of a hit. This is not to say it has declined: it is currently down more than 25 percent compared to where it was in September, although many point to Vince McMahon’s sale of shares and the new five-year rights deal for Smackdown — which begins next fall — as reasons why there was a decline.
When discussing the stock, Cruz thinks a much larger development in the trial would be needed for the stock to take a hit because of it.
“Obviously, if the jury comes out with a huge verdict, I’m sure it will affect the stock price momentarily. But Zuffa seems to be confident either way that they will push this to an appeal and get the result that they want. Now obviously that might not happen, it might lead to a settlement, but at this point, I don’t think that the stock is going to be affected at any time.”