The City of Warren Police and Fire Retirement System has filed a lawsuit against the WWE.
The group, which owns Class A WWE stock is being defended by Robbins Geller Rudman & Dowd LLP.
This is the second lawsuit in the last 3 months filed against the WWE by a stockholder.
In December, Oklahoma Firefighters Pension and Retirement System filed a lawsuit against WWE claiming a conflict of interest between the company and XFL.
The legal counsel has issued the following press release.
ROBBINS GELLER RUDMAN & DOWD LLP FILES CLASS ACTION SUIT AGAINST WORLD WRESTLING ENTERTAINMENT, INC.
New York – March 6, 2020 – Robbins Geller Rudman & Dowd LLP today announced that it filed a class action on behalf of an institutional investor seeking to represent purchasers of World Wrestling Entertainment, Inc. (“WWE”) (NYSE:WWE) Class A common stock during the period between February 7, 2019 and February 5, 2020 (the “Class Period”). This action was filed in the Southern District of New York and is captioned City of Warren Police and Fire Ret. Sys. v. World Wrestling Entm’t, Inc., et al., No. 20-cv-02031.
The Private Securities Litigation Reform Act of 1995 permits any investor who purchased WWE Class A common stock during the Class Period to seek appointment as lead plaintiff in the World Wrestling Entm’t securities class action lawsuit. A lead plaintiff acts on behalf of all other class members in directing the World Wrestling Entm’t securities class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the World Wrestling Entm’t securities class action lawsuit. An investor’s ability to share in any potential future recovery of the World Wrestling Entm’t securities class action lawsuit is not dependent upon serving as lead plaintiff. If you wish to serve as lead plaintiff in the World Wrestling Entm’t securities class action lawsuit, you must move the Court no later than 60 days from today. If you wish to discuss the World Wrestling Entm’t securities class action lawsuit or have any questions concerning this notice or your rights or interests, please contact plaintiff’s counsel, Brian E. Cochran of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at [email protected]
The World Wrestling Entm’t securities class action lawsuit charges WWE and certain of its senior executives with violations of the Securities Exchange Act of 1934. WWE is an integrated media and entertainment company primarily known for its scripted professional wrestling shows. In recent years, WWE has entered into important strategic relationships with the Kingdom of Saudi Arabia, including a multi-year television distribution rights agreement with the Orbit Showcase Network (“OSN”), a Saudi-controlled direct broadcast satellite provider, and a 10-year partnership with the Saudi General Sports Authority to host live events in Saudi Arabia.
The complaint alleges that during the Class Period, defendants made false and misleading statements and/or failed to disclose adverse information regarding WWE’s business and operations. Specifically, defendants failed to disclose that WWE was experiencing rising tension with the Saudi government and a breakdown in negotiations over a renewed broadcasting distribution deal; that the Saudi government and its affiliates had failed to make millions of dollars in payments owed to WWE pursuant to existing contractual commitments between the parties; that OSN had terminated the broadcast of WWE programming in the first quarter of 2019, despite a contractual obligation to continue such broadcasts, and that this cancellation was symptomatic of a deterioration in the business relationship between the parties; that OSN had rebuffed efforts to renew a distribution rights agreement on terms acceptable to WWE; and that WWE did not have the ability to expand its operations in the Middle East or within Saudi Arabia as had been represented to investors.
The problems with WWE’s relationship with the Saudis began to be revealed in a series of partial disclosures. On April 25, 2019, the Company disclosed disappointing financial results and fiscal guidance, which several analysts connected to potential hiccups in the Company’s dealings with the Saudis. On October 31, 2019, in connection with the release of the Company’s third quarter 2019 financial results, WWE revealed significant underperformance across key metrics and revealed that the media rights deal had been indefinitely delayed. Around this same time, it was reported that the Saudi government had withheld tens of millions of dollars in payments owed to WWE. The dispute continued to escalate, culminating in a decision by WWE to cut a broadcasting feed of a live event held in the country. In retaliation, the Saudi government temporarily refused to allow several WWE wrestlers to leave the country in what was later described as akin to a “hostage situation” under the pretense of mechanical airplane issues.
Then, on January 30, 2020, WWE revealed that two of its longest serving senior executives – defendants George A. Barrios and Michelle D. Wilson – had been ousted. Shortly thereafter, on February 6, 2020, WWE again disclosed disappointing financial performance due to its failure to secure a favorable broadcasting deal with the Saudis and revealed that the Saudi media rights deal would not be included in the Company’s financial forecasting. As a result of these disclosures, the price of WWE Class A common stock plummeted from a Class Period high of more than $100 per share to as low as $40.24 per share on February 6, 2020, representing a 60% share price decline.
The plaintiff is represented by Robbins Geller, which has extensive experience in prosecuting investor class actions including actions involving financial fraud.
The entire legal filing can be viewed below.