Since we have had a number of reader ask over the last several days about Vince McMahon and John Laurinaitis, a few points:
Vince McMahon is not involved with the company in any official capacity beyond his ownership of the majority of the company's stock. We are told that has not been to WWE Headquarters since his retirement/resignation. He has not been involved in any meetings or any company communication. As we noted last week, he's been removed from the internal list of performers and has also been removed from the entirety of the company's corporate structure. One ongoing question a lot of those who work for the company have passed around among each other is whether McMahon still has access to the gym in Titan Tower, but no one has heard of him physically going there.
Now, In regard to the idea that McMahon is running things behind the scenes, that's just not the case. For one, it would be illegal for a publicly traded company to do such a thing and if that was outed, all hell would break loose on a criminal level. One source noted that they could understand why someone could believe that such a thing could be possible with McMahon family members involved but the way the corporate structure of the company is laid out with Nick Khan, the Board of Directors, etc. there are lots of checks and balances to prevent such a thing from happening.
As of today, John Laurinaitis is still officially with the company, but internally that is believed to only be a by-product of the internal investigation. Laurinaitis' email and company cell phone are said to be disconnected, which is what the company did to furloughed employees at the height of the COVID-19 pandemic. The expectation is he will be gone when the Board of Directors investigation is officially completed.
WWE filed a notice with the SEC today, informing them the following:
On June 17, 2022, World Wrestling Entertainment, Inc. (the “Company”) and its Board of Directors announced that a special committee of independent members of the Board of Directors (the “Special Committee”) was conducting an investigation into alleged misconduct by the Company’s former Chairman and Chief Executive Officer, Vincent K. McMahon, who resigned from all positions held with the Company on July 22, 2022 but remains a stockholder with a controlling interest, and another executive, who is also no longer with the Company.
On July 25, 2022, the Company announced that it has made a preliminary determination that certain payments that Vince McMahon agreed to make during the period from 2006 through 2022 (including amounts paid and payable in the future totaling $14.6 million) were not appropriately recorded as expenses in the Company’s consolidated financial statements.
Since that time, the Company has determined that two additional payments totaling $5.0 million, unrelated to the allegations that led to the Special Committee investigation, that Mr. McMahon made in 2007 and 2009 should have been recorded in the Company’s consolidated financial statements. Together, these unrecorded expenses total $19.6 million (the “Unrecorded Expenses”). The Company has evaluated the Unrecorded Expenses and has determined that such amounts should have been recorded as expenses in each of the periods in which they became probable and estimable. All payments underlying the Unrecorded Expenses were or will be paid by Mr. McMahon personally. The Special Committee investigation remains ongoing.
Although the Company continues to evaluate the impact of the Unrecorded Expenses on previously issued financial statements, the Company has preliminarily determined that the amount of Unrecorded Expenses was not material in any individual period in which the Unrecorded Expenses arose, but that the aggregate amount of Unrecorded Expenses would be material if recorded entirely in the second quarter of 2022.
Accordingly, the Company currently anticipates that it will revise its previously issued financial statements to record the Unrecorded Expenses in the applicable periods for the years ended December 31, 2019, 2020 and 2021, as well as the first quarter of 2022, when it issues its financial statements for the second quarter of 2022.
In light of the Unrecorded Expenses and related facts thereto, the Company also expects to conclude that its disclosure controls and procedures and internal control over financial reporting were not effective as a result of one or more material weaknesses. The Company continues to evaluate the appropriate accounting treatment for the Unrecorded Expenses, as well as its disclosure controls and procedures and internal control over financial reporting, and its ultimate conclusions on these topics may differ from what the Company currently anticipates.
The Company has also received, and may receive in the future, regulatory, investigative and enforcement inquiries, subpoenas or demands arising from, related to, or in connection with these matters.
As a result of the circumstances described above, the Company is unable to file, without unreasonable effort and expense, its Form 10-Q for the quarterly period ended June 30, 2022 (the “Report”). The Company currently anticipates that it will file the Report within the five day extension period provided under Rule 12b-25 of the Securities Exchange Act of 1934, as amended, but there can be no assurance that it will be able to do so. The Company provided preliminary estimates of certain financial results that it expects to report for the quarter ended June 30, 2022 in a Current Report on Form 8-K filed on July 25, 2022 (SEC File No. 001-16131).
I'm sorry but once WWE fully concludes their investigation of Vince's business transactions he should be forced to forfeit all of his stocks and have no stake or association with the company. Now the feds are investigating him as well? Dude is nothing but a BIG liability to WWE now.
“The additional $5.0 million WWE found in payments made by Vince McMahon in 2007 and 2009, and which should’ve counted as company expenses, match the amount and years of payments WWE made to the Trump Foundation...”
“...WWE was by far the biggest contributor to the Trump Foundation in 2007 and 2009, giving the organization $4 million and $1 million in those years, respectively, and in round numbers — which adds up to match the $5.0 million mentioned in the new WWE filing. Those were also years when the future U.S. president made rare appearances on WWE television programs.”
“Despite the IRS filings listing WWE as the contributors to the Foundation in those years, a WWE spokesperson in October 2012 said the money came directly from Vince McMahon, as opposed to the company, or both Vince and Linda...Later, in 2016, a WWE spokesperson denied the Foundation contributions served as Trump’s appearance fees and that ‘WWE paid Donald Trump appearance fees separately.’ But this time WWE said both McMahons personally made the contributions to the Foundation.”