It’s another week. Forget what you have seen on television this week, let’s get to the behind-the-scenes stuff which you may or may not know about.
Getting right to it, WWE is in the midst of a second-run of firings and releases. The first casualty took place on Wednesday, with the release of Ricardo Rodriguez. It will not be limited to the wrestlers, but to staff and production crew. The money put into the WWE Network is not paying off and even the financial investors are crying foul as millions of dollars are being lost.
On Thursday, I received the saddest announcement from a former writer, WWE Magazine and the entire publications department is no more. We are talking about WWE Magazine, a print publication which outlasted numerous other sports magazines which folded due to rising costs and internet accessibility. I was a member of the publications staff, albeit for a short time, but personally I still felt a bit empty inside. It is a sad day when print is delivered yet another loss.
For some odd reason I still am subscribed to the Wall Street Journal’s MarketWatch newsletter, and in the past week I must have received two or three emails about pending Class Action Lawsuits from the firms of Bower Piven, Robbins Arroyo, Levi & Korsinsky, all stemming from an initial investigation from Ademi & O’Reilly, LLP into possible securities fraud committed by WWE.
I don’t even know what I just said. I don’t even know who these people are. I am not a lawyer or a legal expert in the slightest. I know nothing about this financial stuff. So, I got a guy. I talked to my guy, a financial expert, and found some enlightenment.
“WWE may be guilty of breaching fiduciary responsibility.” What this means, is they had a job. To fulfill their financial obligations to the shareholders entrusting their money to the company. It happens in any company, you invest, and you either gain, or lose. Except when you lose big, you question the decisions of those holding your money. It is the responsibility of the WWE Board of Directors to ensure funds are not mismanaged and safeguards are set in place to prevent catastrophic financial loss. This is not limited to WWE at all, this is the responsibility of any publically traded company. When too much money is being lost firms jump at the opportunity to cash in with Class Action Lawsuits.
“The key item to remember, is until the investigations are complete, one cannot accurately determine what prompted the lawsuits.”
Since we are not sure of what exactly took place, I asked what the possible ramifications of these allegations are. “It could force WWE into bankruptcy, or nothing could happen at all, and the only winners are the law firms who collect their fees. These are set up to promote investigations against claims of the mishandling of the shareholder’s investments. If they find there was fraud, it could be a major problem. If it comes down to acceptable losses due to the high-risk nature of the business, a settlement could be reached and business goes back to normal. Worst case scenario, it costs WWE millions upon millions of dollars, and forces them to declare bankruptcy. It does not mean the death of a company, but forces restructuring and reorganization while protecting from creditors and shareholders.” This means WWE may have an uphill battle, or, it may prove that some big risks were taken, and didn’t pay off. Bankruptcy? I never would have thought WWE could be pushed to that limit. It would certainly shake the landscape of future business.
But how did this all start? With all the bad press, the negative deal with USA Network, the underwhelming subscription rate for the WWE Network, what could have prompted such swift action by legal and financial firms?
“Again, there has been no evidence, and no concrete proof of wrongdoing. However, in the past, companies facing similar situations, one could theorize there is likely to have been a whistle-blower, or an organization working on behalf of the shareholders acting as whistle-blower… To investigate possible mishandling of funds, money being pocketed or distributed to non-existing vendors, or possibly fraudulent accounting practices. The bottom line is this: Poor decisions were made, likely from the board of directors and other executives to put more money in their own pockets, and someone rang the bell on them. Match over.”
Thank you Mr. Financial Expert. What we do know, based off public releases and watching the stock, WWE is losing money, fast. The deal with USA went south fast. They lost two pay-per-view carriers in Dish and DirectTV. They expected their beloved “WWE Universe” to drop what they were doing and sign up for the Network because everyone has nothing better to do with their lives and watch wrestling. Personally, I would love to take a few hours a day and watch the wrestling programs I grew up with, but I can’t. Have a job (sort of), have kids, priorities, and quite frankly, there are other shows on television I want to watch.
WWE played a game which on paper seemed like a sure-fire win, but ultimately lost. I have no doubt guys like Batista and Brock Lesnar are taking home huge paychecks. I have no doubt Chris Jericho is getting a nice direct deposit every month. Hey John Cena, you love WWE so much? How about agreeing to a slight reduction in salary. I’m not asking you to cover Zack Ryder’s expenses so he can job at every live event, but if the company “you love” and would “die for” is showing signs of financial problems, suck it up and be a man at your word. How many homes do you need anyway?
If this is not bad enough, TNA Impact Dixie Carter Wrestling may no longer have a home on cable television. I say, may have, because initially TMZ posted SpikeTV was canceling the weekly Thursday night program. However, more recent news indicates they are not canceled yet, but are being given an opportunity to shop around for a new station until their contract is up in October. So come October, Impact is gone from Spike for good. Will the plug be pulled sooner? That call is up to SpikeTV and no one else. Shame, the past few weeks have seen a surge in some good action, and this past week with the Destination X special, was no exception. Solid stars, solid bouts, but no one really stands out anymore in the top-tier. Bobby Roode, Bobby Lashly, Low Ki, Samoa Joe, Austin Aries, and others. They are top quality talents, but something never feels quite right. It does not feel like you are watching a match with main events, but a whole show stacked with an undercard. Ironically, the last WWE event, Battleground was dominated by high quality undercard matches while the main event was lackluster. I suppose from Impact we had expected better, but have become so desensitized to disappointment, no one, and I refer to the viewers live and at home, put their hearts into the show anymore.
I wish I was wrong, but I feel like I am not. This bothers me. Remember when TNA first aired on television? Fans wanted more. The roster was chock full of talent, and their top guys were not guys you would expect, which is what made it even better. Samoa Joe, AJ Styles, Jeff Hardy, Kurt Angle, Christopher Daniels, Low Ki, and Amazing Red. I do not need to rehash the history of TNA becoming the latter years of WCW, but I feel if those years did not happen, Impact Wrestling would not be in the mess it is in now. I have seen blame vary from Jeff Jarrett to Dixie Carter, from Hulk Hogan to Vince Russo. I think the blame may rest on all of them. Jarrett wanted his own company to be “King of the Mountain” of and he got it. Then it went south for him, so he bails. Hogan comes in, and suddenly a surge of old guys from yesteryear show up. I don’t even count guys like Kurt Angle, Team 3D and Christian in there, I refer to Hogan, Flair, Kevin Nash, Scott Hall, X-Pac, and a bunch of other guys who have not actively been engaged in physical activity for close to a decade at the time of their arrival in TNA. Not only did the storylines go south, but television production went south. Scriptwriting took a nosedive into insanity. Sting shows up, and further sheds what dignity he had left.
This is not anger, but frustration. TNA/Impact/Whatever could have been a great promotion, but at this point, they are no longer number two. They just exist, and if someone is bored, said person might flip to SpikeTV, or if said person actually does have the WWE Network, watch NXT instead.