Stockholders sue WWE over Saudi Arabia ties
Robbins Geller Rudman & Dowd LLP announced a class action suit against WWE over its relationship with Saudi Arabia and recent moves at the top that caused the stock to plummet, according to Business Wire.
The complaint alleges WWE, “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.”
The lawsuit also claims due to a series of events the WWE stock plummeted from $100 per share to $40.24 in early February.
Back in November, there were major flight delays out of Saudi Arabia that forced WWE to re-write the following SmackDown due to talent not making it back in time. Initial reports said Saudi Arabia owed WWE money, which caused Vince McMahon to cut the live feed until the two sides apparently worked things out. WWE “swiftly denied” these allegations when asked about it in November.
Due to all of this, the rumor was Saudi Arabia then delayed the flight in retaliation for what WWE did. WWE maintained that the delays were due to mechanical failures. The lawsuit mentioned much of this in the Business Wire report.
The abrupt exit of WWE Co-Presidents George Barrios and Michelle Wilson in late January, followed by poor financial performance report (causing the stock to drop mightily) in early February was also documented in the lawsuit.
As noted, in a separate lawsuit filed by the Oklahoma firefighters pension fund in December, claimed there is “a credible basis to believe” Vince McMahon and other WWE senior officials are not keeping up with their WWE duties as they focus resources towards the XFL, which is run under McMahon’s Alpha Entertainment, LLC.