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In one of their SEC document filings are part of their quarterly earnings release, TKO noted the following WWE legal proceeding updates:
As announced in June 2022, a Special Committee of independent members of WWE’s board of directors (the “Special Committee”) was formed to investigate alleged misconduct by WWE’s then-Chief Executive Officer, Vincent K. McMahon (the “Special Committee investigation”). The Special Committee investigation is complete and, in January 2024, Mr. McMahon resigned from his position as Executive Chair and member of the Company's board of directors, as well as other positions, employment and otherwise, at TKO and its subsidiaries. No charges have been brought against the Company.
On January 25, 2024, a former WWE employee filed a lawsuit against WWE, Mr. McMahon and another former WWE executive, John Laurinaitis, in the United States District Court for the District of Connecticut alleging, among other things, that she was sexually assaulted by Mr. McMahon and Mr. Laurinaitis and asserting claims under the Trafficking Victims Protection Act. On May 30, 2025, Mr. Laurinaitis was dismissed from the matter with prejudice pursuant to a stipulation of dismissal. WWE moved to compel the matter to arbitration, and the remaining parties subsequently executed an agreement to submit their dispute to arbitration. On July 24, 2026, pursuant to that agreement, the former employee filed a stipulation of voluntary dismissal with prejudice of her federal lawsuit.
On October 23, 2024, five unnamed plaintiffs filed a lawsuit against Mr. McMahon, Linda McMahon, WWE, and TKO in Maryland court, alleging sexual abuse by a former World Wrestling Federation ring announcer during the 1980s. On April 28, 2025, plaintiffs filed an amended complaint adding three unnamed plaintiffs, but no new defendants. On December 10, 2025, the court dismissed the claims asserted by one of the unnamed plaintiffs (and certain other claims asserted against Ms. McMahon) but otherwise denied defendants’ motions to dismiss. In April 2026, the court ordered briefing on defendants’ constitutional challenges to the state law on which the plaintiffs’ claims are premised. On October 19, 2026, the court denied Defendants’ motion for judgment on the pleadings based on those constitutional challenges.
On November 17, 2023, a purported former stockholder of WWE, Laborers’ District Council and Contractors’ Pension Fund of Ohio, filed a verified class action complaint on behalf of former WWE stockholders in the Court of Chancery of the State of Delaware (“Delaware Court”). On November 20, 2023, another purported former WWE stockholder, Dennis Palkon, filed a substantially similar verified class action complaint. Both complaints allege breach of fiduciary duty claims against former WWE directors Mr. McMahon, Nick Khan, Paul Levesque, George A. Barrios, Steve Koonin, Michelle D. Wilson, and Frank A. Riddick III (collectively, the “Individual Defendants”), arising out of the TKO Transactions.
On April 24, 2024, the City of Pontiac Reestablished General Employees’ Retirement System, a third purported former WWE stockholder, filed another verified class action complaint, which similarly alleges breach of fiduciary duty claims against the Individual Defendants and added claims against WWE and TKO for denying stockholders their appraisal rights under DGCL § 262, as well as claims against EGH for aiding and abetting the alleged breaches of fiduciary duties and for civil conspiracy to violate DGCL § 262. On May 2, 2024, the Court entered an order consolidating all actions under the caption In re World Wrestling Entertainment, Inc. Merger Litigation, C.A. No. 2023- 1166-JTL (“Consolidated Action”). Lead plaintiffs subsequently designated the Palkon complaint as operative. As a result, WWE, TKO and EGH are no longer defendants. On October 24, 2024, the Delaware Court entered a stipulation dismissing all claims against Messrs. Koonin and Riddick, who, therefore, are no longer defendants. The remaining Individual Defendants filed answers to the complaint on October 28, 2024. Fact discovery closed on December 19, 2025, and expert discovery closed on April 10, 2026.
In early June 2026, the parties reached an agreement in principle to resolve all claims against all defendants. On August 25, 2026, the parties filed a stipulation and agreement of settlement, compromise, and release, subject to the Delaware Court’s approval. On September 2, 2026, the Delaware Court entered an order scheduling a hearing on the proposed settlement for November 30, 2026. The overall settlement amount was primarily funded by insurance recoveries, with WWE funding a portion as a result of pre-existing indemnification obligations owed by WWE to the directors. WWE’s portion of the overall settlement amount was $105.0 million, which was funded by insurance recoveries of $72.6 million, resulting in a loss of $32.4 million. The net estimated loss is included within selling, general and administrative expenses in the consolidated statements of operations for the nine months ended September 30, 2026.
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