World Wrestling Entertainment chairman Vince McMahon is no stranger to public scandals, but in a new report by The Wall Street Journal, the latest controversy now has the Chairman under investigation by his own board of directors.
According to WSJ, the board of World Wrestling Entertainment Inc. is investigating a secret $3 million dollar settlement that longtime chief executive Vince McMahon agreed to pay to a departing employee with whom he had an affair, according to documents and people familiar with the board inquiry.
The former employee, who was hired as a paralegal in 2019, was barred by the January 2022 separation agreement from talking about the details of her relationship with Vince. However, the investigation has gone deeper into other matters.
The investigation, which started in April, revealed other nondisclosure agreements between female ex-employees of the company alleging misconduct by McMahon and John Laurinaitis. John heads the talent relations at WWE. While it’s unconfirmed how many NDAs there are in total, the board’s outside counsel claims that settlements have been handed out in millions of dollars.
The board’s eight independent directors have retained New York-based law firm Simpson Thacher & Bartlett LLP to conduct the investigation. The board’s preliminary findings are that Mr. McMahon used personal funds to pay the former female employees who signed the agreements, including the one involving allegations against Mr. Laurinaitis.
The law firm also is assessing WWE’s compliance and human resources programs and company culture.
Board members learned of the $3 million dollar agreement in a series of anonymous emails they received from someone who said the former WWE paralegal was a friend. Mr. McMahon’s attorney, Jerry McDevitt, said that the former paralegal hadn’t made any claims of harassment against Mr. McMahon, and that “WWE did not pay any monies” to the ex-employee “on her departure.”
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A source close to the situation is expecting a “s***storm” over the course of the next few weeks as more details become public with this ongoing situation. WWE became a publicly-traded company in 1999, and allegations of financial misconduct by the chairman could have a negative impact on the company’s stock price and distrust from shareholders. WWE’s stock price sits at $67.18 as of this writing.
Last month, WWE’s Chief Brand Officer Stephanie McMahon, the daughter of Vince, revealed she is taking a “leave of absence” from the majority of her roles within the company.
Stephanie announced on Twitter “As of tomorrow, I am taking a leave of absence from the majority of my responsibilities at WWE. WWE is a lifelong legacy for me and I look forward to returning to the company that I love after taking this time to focus on my family.”
Stephanie stated that her hiatus would only be temporary as she looks forward to resuming her role with the promotion. Her husband Paul Levesque, aka “Triple H” retired from in-ring competition at the age of 52 this year after suffering a massive heart attack last summer, which left him with a defibrillator fitted to his chest.
Levesque remains the Executive Vice President for Global Talent Strategy & Development of WWE.
This is not Vince’s first rodeo with a major public scandal. McMahon was acquitted in 1994 after being accused of distributing steroids to his wrestlers, and his company was under fire in 2007 following the double murder-suicide of famed wrestler Chris Benoit.
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Despite the investigation, Vince McMahon controls about 80% of WWE’s voting power, despite owning just 37% of the company. Brandon Thurston of Wrestlenomics cites that shares held by Vince, Linda McMahon, and Stephanie McMahon are class B, which give each of their shares 10x voting power over class A shares held by all others.
What are your thoughts on the latest scandal surrounding the pro wrestling titan?