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WWE Network News is reporting that the WWE Network will begin adding episodes of Sunday Night Heat to the VOD section of the streaming service on Monday 5/7, likely meaning that the plan to add the remainder of Mid-Atlantic TV episodes has been postponed. Heat was originally earmarked to debut on the Network at the end of 2017, but was pulled from WWE's plans due to the lawsuit filed by Buff Bagwell and Scott "Raven" Levy regarding the company not paying royalties on WWE Network material for content that talents would receive royalties for if it was released via physical media, such as DVDs.
Bagwell and Raven had alleged that WWE had breached their contracts of both Bagwell and Levy by failing to pay direct sales royalties to material that was included on the WWE Network's streaming service. WWE's contracts define material they provide royalties for as content that fall under direct sales, defined as "...including without limitation, at the arena, via mail order sales or directly on television, or via the Internet...." Levy and Raven argued that WWE Network subscriptions would fall under that description, while WWE argued that unlike a DVD, which they do provide royalties for, there is no sale of physical media with a WWE Network subscription, just a license that a subscriber rents, allowing them to view the content offered.
Levy had argued that talent should be paid for the WWE Network under the same royalty rate that they would receive contractually, from PPV and video sales. He also argued that once WWE purchased the WCW and ECW video libraries, those libraries would now fall under the promised royalty rate that he was promised contractually from WWE for direct sale of WWE events and that when he was released by WWE in 2013, the agreement to release him noted WWE had completely bought Levy out of any claims against them or any money owed "other than the obligation to pay Levy the royalties due to him pursuant to, and as determined by, the Contract."
Bagwell made similar claims in the lawsuit, alleging WWE failed to pay royalties on material on WCW and WWE content featuring Bagwell that was available on the WWE Network. Bagwell had also alleged that WWE, by selling WCW content, without paying him his royalties, had breached an agreement the parties signed when Bagwell released by WWE in 2001 after a short, uneventful run. Bagwell had also alleged that WWE had failed to pay him royalties within 90 days, was late in paying royalties and has not paid any royalties since February 2014 when the WWE Network launched. The non-payment of royalties was another alleged breach of Bagwell's contract,
The lawsuit also alleged that WWE breached its fiduciary duty to Levy and Bagwell because WWE was in a superior position when it came to knowledge of finances and money owed to the talents. Bagwell had claimed that his WWE contract allowed him to have his own independent certified accountant audit WWE-WCW's books, citing, "for the purpose of verifying the accuracy thereof, during WCW’s normal business hours and upon reasonable notice. Such audit shall be conducted in a manner that will not unreasonably interfere with WCW’s normal business operations. Wrestler shall not audit WCW’s books and records more than twice during any calendar year and no such audit shall be conducted later than one (1) year after the last statement of royalties is given, delivered or sent to Wrestler. Each audit is limited to seven (7) days in duration. Statements of royalties may be changed from time to time to reflect year-end adjustments, to correct clerical errors and for similar purposes."
Bagwell alleged that he had attempted to do exactly that in June 2016 and was initially told an audit could be done in late July or early August 2016, only to later be informed by WWE's counsel, K&L Gates, that there would be no audit, as Bagwell's accountant, "asserted a pretextual and invalid audit request to attempt to stealthily obtain that information (WWE network royalty audit)" and that since Bagwell is not paid WWE Network royalties, "there is nothing to audit." Since WWE blocked Bagwell's attempts to audit the records as he was contractually allowed to do, he claimed that the company had forfeited any claim that Bagwell did not satisfy any of WWE's prerequisite actions contractually before he filed his lawsuit.
The Bagwell/Levy lawsuit led to WWE pulling WCW Thunder (as both appeared all over the series) and Heat, which regularly featured Levy in episodes from the year 2000 on. WWE actually had internal research done to determine if it was worth removing all signs of Levy and Bagwell from the Network's VOD component, despite the amount of manpower and money it would require before opting to wait and see how the legal case resolved it.
As it turned out, WWE was smart to do so. In December 2017, the United States District Court of Connecticut officially dismissed the lawsuit with prejudice after Levy and Bagwell agreed to drop the case shortly after being deposed by WWE attorney. That's a sign that something about their claims didn't hold up scrutiny under questioning. Neither party will be allowed to bring claims against WWE again, either, which was part of the agreement that Bagwell and Levy agreed to when they withdrew the case. There was no financial settlement in the case.
Thunder was added to the Network earlier this year and as of this Monday, with legal obstacles out of the way, WWE will begin adding Heat as well.
Sunday Night Heat debuted in August 1998 on the USA Network, featuring Shane McMahon as one of the original announcers. On PPV days, it would feature live episodes designed to build interest in selling the PPV events with undercard matches, similar to what is now the WWE PPV Kickoff Show on the WWE Network. When WWE moved from USA to Viacom in 2000, Heat was re-tooled on MTV as a live broadcast from the WWF New York restaurant in Times Square. The series eventually transitioned over to SpikeTV and when WWE returned to the USA Network, it was turned into a WWE website series. The series officially ended in 2008.
WWE's original plans for the Vault section additions of the Network's VOD area was to add 104 episodes of Mid-Atlantic TV this month, finishing out all the Mid-Atlantic TV in the WWE library, add another 76 episodes of Mid-South in June and then another 50 episodes of WCW Saturday Night in July. There's no confirmation on how Heat's additions will impact these plans. We can also confirm there are plans to add additional WWF Coliseum Home Video titles later this year to the Vault as well.
Thanks to Paul Jordan.
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