SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 19, 2004
World Wrestling Entertainment, Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 000-27639 04-2693383
---------------------------- -------------- -------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1241 East Main Street, Stamford, CT 06902
----------------------------------------------- ----------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (203) 352-8600
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2.):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 8.01. Other Events.
On October 19, 2004, World Wrestling Entertainment, Inc. issued a press
release announcing that the Company had filed an action in the U.S. District
Court for the Southern District of New York against Jakks Pacific, Inc., two
foreign subsidiaries of Jakks, THQ, Inc., a joint venture involving Jakks and
THQ, Stanley Shenker and Associates, Inc. and Bell Licensing, LLC. The suit also
names as defendants certain individuals employed by the corporate defendants,
including three senior executives of Jakks, and Stanley Shenker and James Bell.
The Company's lawsuit alleges violations of the Racketeer Influenced and
Corrupt Organization Act (RICO) and the anti-bribery provisions of the
Robinson-Patman Act, and various claims under state law. The Company is seeking
treble, punitive and other damages and a declaration that the existing videogame
license with the joint venture of Jakks and THQ and a related amendment to the
toy licenses with Jakks are void and unenforceable.
Jakks has been the Company's toy licensee since late 1995 and operates
under current licenses that expire by their terms in 2009. The joint venture of
Jakks and THQ obtained a videogame license from the Company in 1998, which
license is to expire in 2009, subject to a right by the joint venture to extend
the license for an additional five years. During the pendency of this
litigation, the Company intends to continue to fulfill its obligations under the
current licenses and expects Jakks and THQ to do likewise. The current licenses
account for approximately 3.5% of the Company's total annual revenues.
Item 9.01. Financial Statements and Exhibits.
(a) Not applicable.
(b) Not applicable.
(c) Exhibits
99.1 Press Release dated October 19, 2004.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
WORLD WRESTLING ENTERTAINMENT, INC.
By: /s/ Philip B. Livingston
---------------------------------------
Philip B. Livingston
Chief Financial Officer
Dated: October 19, 2004
FOR IMMEDIATE RELEASE CONTACT: GARY DAVIS
--------------------- 203.353.5066
WORLD WRESTLING ENTERTAINMENT, INC. FILES SUIT AGAINST
JAKKS PACIFIC, INC., THQ, INC. AND RELATED DEFENDANTS
WWE CITES RICO VIOLATIONS AND COMMERCIAL BRIBERY SCHEME
IN CONNECTION WITH INTELLECTUAL PROPERTY LICENSES
STAMFORD, Conn., October 19, 2004 --World Wrestling Entertainment, Inc.
("WWE") today filed a fourteen count complaint in the United States District
Court for the Southern District of New York against Jakks Pacific, Inc.
("Jakks"), two foreign subsidiaries of Jakks, THQ, Inc. ("THQ"), a joint venture
involving Jakks and THQ, Stanley Shenker & Associates, Inc. ("SSAI") and Bell
Licensing, LLC. The suit also names as defendants certain individuals employed
by the corporate defendants, including specifically Jack Friedman, Stephen
Berman and Joel Bennett, the three highest-ranking executives of Jakks, and
Stanley Shenker and James Bell.
The suit alleges numerous violations of the Racketeer Influenced and
Corrupt Organization Act (RICO); violations of the anti-bribery provisions of
the Robinson-Patman Act; and various claims arising under state law. By the
action, WWE is seeking treble, punitive and other damages, as well as a
declaration that the videogame license with the joint venture of Jakks and THQ,
and a related amendment to the toy license with Jakks, are void and
unenforceable due to commercial bribery and other violations of state law. The
lawsuit can be viewed at corporate.wwe.com.
The suit arises out of litigation initially commenced by SSAI against WWE
in Connecticut state court for commissions SSAI claimed it had earned while
serving as WWE's licensing agent. During that litigation, WWE discovered certain
irregularities in its licensing program beginning in the 1998 time frame when
SSAI served as WWE's licensing agent and Bell served as WWE's Senior Vice
President of Licensing and Merchandising. Specifically, WWE learned in the
Connecticut state court proceeding that SSAI split its commissions with Bell on
various licenses allegedly procured by SSAI and recommended to WWE management by
Bell. WWE also learned that certain licensees had paid monies into a foreign
bank account controlled by Shenker during the time he was WWE's licensing agent.
In the Connecticut case, the Court found that Stanley Shenker had committed
serial perjury in order to cover up his payments to Bell and his receipt of
monies in a foreign bank account from WWE licensees, including Jakks, and
granted a default judgment in favor of WWE against SSAI on counterclaims
asserted against SSAI. The Court in the Connecticut case has also granted
partial summary judgment against Bell in favor of WWE on claims asserted against
Bell by WWE.
The federal lawsuit filed by WWE against Jakks and the other defendants
relates to a series of payments made in 1998 to Shenker's foreign bank account
by two foreign subsidiaries of Jakks. The Company has discovered that the
payments in question were then split with Bell by Shenker. Two of the payments
in question occurred during the time that WWE was in the process of selecting a
licensee for videogames featuring WWE talent. One of the payments was directed
to be made by Jakks' officers on the same day that SSAI and Bell recommended
that the videogame license be granted to Jakks. The third payment was made after
the videogame license was awarded to a joint venture of Jakks and THQ.
In a statement issued today, Linda McMahon, the Chief Executive Officer of
WWE, stated:
"We very much regret having to take this action today, but
regret even more the facts and circumstances which have
compelled us to do so. WWE's intellectual property is a
valuable asset of the Company, and we believe the actions
taken today are necessary to preserve the integrity of our
licensing process and essential to ensure that WWE receives
appropriate and fair compensation for the grant of a license
to use our intellectual property."
Jakks has been WWE's toy licensee since late 1995 and the current toy
licenses are otherwise set to expire in 2009. The joint venture of Jakks and THQ
obtained the videogame license in 1998, with its term also scheduled to expire
in 2009, subject to a right to renew the license by the joint venture for
another five years on certain conditions.
World Wrestling Entertainment, Inc. is an integrated media and
entertainment company headquartered in Stamford, Conn., with offices in New York
City, Los Angeles, Toronto, and London.
Trademarks: The names of all World Wrestling Entertainment televised and live
programming, talent names, images, likenesses, slogans and wrestling moves and
all World Wrestling Entertainment logos are trademarks which are the exclusive
property of World Wrestling Entertainment, Inc.
Forward-Looking Statements: This news release contains forward-looking
statements pursuant to the safe harbor provisions of the Securities Litigation
Reform Act of 1995, which are subject to various risks and uncertainties. These
risks and uncertainties include general market conditions, which could result in
only a portion or none of the shares being registered to be offered and sold,
the conditions of the markets for live events, broadcast television, cable
television, pay-per-view, Internet, entertainment, professional sports, and
licensed merchandise; acceptance of the Company's brands, media and merchandise
within those markets; uncertainties relating to litigation; risks associated
with producing live events both domestically and internationally; uncertainties
associated with international markets; risks relating to maintaining and
renewing key agreements, including television distribution agreements; and other
risks and factors set forth from time to time in Company filings with the
Securities and Exchange Commission. Actual results could differ materially from
those currently expected or anticipated.