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MLW has amended its lawsuit against WWE

MLW has amended its lawsuit against WWE.

MLW alleges that WWE’s agreement with Peacock, which reportedly keeps non-WWE pro wrestling content off of the NBCUniversal streaming platform, contributes to its antitrust case against WWE, according to MLW’s amended complaint filed yesterday.

MLW’s new broadcaster, Reelz recently made a deal that will allow the channel to be streamed live on Peacock, except for when MLW Underground airs on Tuesdays at 10 pm.

Not explicitly mentioned by MLW, Variety reported last week that MLW’s run on Reelz is only to last ten weeks. Reelz later made a statement, saying the network hadn’t yet made a decision about MLW programming. The comment notably didn’t clarify how long MLW would air on Reelz.

The original complaint, which was filed more than a year ago in January 2022, was dismissed last month by the judge in the case but allowed MLW to amend its claims. Judge Edward J. Davila wrote that “MLW has not included sufficient facts to plausibly allege a relevant antitrust product market.”

WWE last year responded to the initial claims, arguing that MLW was trying to improperly blame WWE for its business failures.

The rewritten filing more narrowly defines the market relevant to claims that WWE is violating the Sherman Antitrust act as the U.S. market for pro wrestling media content, rather than the U.S. pro wrestling market more broadly.

MLW argues exclusivity agreements like those WWE reportedly made with Peacock, which prevents the platform from distributing wrestling content that doesn’t belong to WWE, isn’t the norm in the media industry.

New to MLW’s narrative is a description of wrestling business history in which WWE has been the dominant force since WCW went out of business in 2001 and was acquired by WWE. The 1990s are described as a high point for the wrestling industry with strong television viewership amid competition from WCW and ECW. MLW further claims that WWE moving its program Raw to TNN in 2000 led to the cancellation of ECW from the same network, which later resulted in ECW’s assets being bought as well by WWE.

MLW raises more specific claims than in its prior complaint, which also alleged unfair practices related to venues and talent.

The suit alleges WWE executive “Triple H” Paul Levesque called Madison Square Garden in 2018 to urge the venue to cancel its scheduled event to be held by Ring of Honor and New Japan, the eventual G1 Supercard that took place on Wrestlemania weekend in April 2019. MSG did cancel the show, but rescheduled it only after Sinclair Broadcasting, ROH’s then-parent company, threatened legal action, MLW claims.

According to MLW, WWE blocked AEW from running at Heritage Bank Center in Cincinnati in 2019 and early 2020.

When it comes to interfering with talent, MLW says WWE hired away then-current MLW champion Stephon Strickland (current AEW wrestler Swerve Strickland, known as Isaiah “Swerve” Scott in WWE). WWE’s talent executive at the time, Canyon Ceman is alleged to have encouraged Strickland to opt out of his MLW contract. In July 2021, WWE allegedly hired Davey Boy Smith Jr. away from MLW. Smith subsequently only appeared in one dark match for WWE, which “made clear [WWE’s] intent to impair MLW’s ability to build its brand and viewership by removing one of its successful wrestlers.”

MLW says AEW demanded WWE stop contacting many AEW wrestlers who WWE was trying to hire away. The claim seems related to AEW CEO Tony Khan’s assertion that AEW wrestlers have told him WWE has approached those wrestlers and tried to get them to break their contracts with AEW.

MLW points out WWE ran two premium live events on Labor Day weekend, one the day before AEW’s All Out pay-per-view and another earlier on the same day, which the plaintiff alleges was intended to prevent the success of the AEW event.

To illustrate how hard it is to compete with WWE, MLW claims AEW “has yet to be profitable since launching in 2019.”

In an attempt to strengthen its argument that other content can’t be substituted for pro wrestling content — a counter WWE has raised — MLW argued wrestling programming provides a unique audience.

MLW claims wrestling content reaches the valuable 18 to 49 age demographic and that its audience is different from that of other programs because it skews male and with viewers aged 35 to 44. Pro wrestling is a unique combination of sports and entertainment, a claim purportedly supported by public comments from Stephanie McMahon and former WCW executive Eric Bischoff. MMA, boxing, and other sports are not substitutes, MLW says, because they’re not predetermined and the drama can’t be controlled like in pro wrestling. Additionally, pro wrestling is aired year-round, unlike other sports.

WWE’s conduct is a detriment to wrestling fans, MLW claims, writing WWE “has harmed wrestling fans by reducing their choices and quality of professional wrestling programming and increasing their costs of consuming that content.”

Further public comments from Jim Ross and from a Wrestlenomics article are referenced as MLW argues media distribution is necessary to compete in the market.

As in the original complaint, MLW maintains that WWE interfered with MLW’s media deals with Tubi, Vice, and FITE.

MLW presents an analysis of the U.S. pro wrestling media rights market, arguing WWE currently controls 92% of the revenue from that market, with its deals for Raw and Smackdown, worth a combined $470 million per year. AEW, with its deal worth $43.8 million per year makes up 6% of the market, MLW says. That leaves less than 2% of the remaining market going to other wrestling companies in the U.S., including MLW, Impact Wrestling, New Japan Pro Wrestling, Women of Wrestling, Ring of Honor, and the National Wrestling Alliance.

MLW makes a calculation that it admits is likely an overestimate, based on the value per viewer of AEW’s media deal. The rest of the market MLW estimates a total of $11.5 million per year. Based on MLW’s own formula, New Japan makes an estimated $1.57 million per year and WOW an estimated $8.45 million per year. MLW estimates Impact, Ring of Honor, and the NWA generate no revenue from media rights fees. Details about revenue MLW generates appear to be redacted in the filing, but MLW’s estimate seems to imply the company has the potential to generate about $1.5 million per year between Reelz and Pro Wrestling TV, given if you subtract $8.45 million and $1.57 million from $11.5 million, the value left is about $1.5 million.

We should note that the above revenue values are only MLW’s estimates and are meant to demonstrate the highest possible value other wrestling companies may be generating from media rights fees. MLW is trying to emphasize how little revenue other wrestling companies generate in comparison to WWE. Before the above estimate is presumed as a reliable analysis of wrestling media revenue, it should also be noted that MLW didn’t try to estimate revenue Impact, Ring of Honor, and NWA may be generating from pay-per-view, streaming subscription services, or ad-supported platforms like YouTube. The actual revenue those companies generate from media distribution isn’t publicly known and may be far different.

MLW continues to be represented by lawyers from the well-known law firm Kasowitz Benson Torres LLP. The amended complaint is submitted by Christine Montenegro, whereas the original complaint was submitted by Jason Takenouchi.

We contacted MLW and WWE and have yet to hear back. This article will be updated if either provides a comment.

Source: Wrestlenomics

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