WWE Loses Licensing Rights Case
World Wrestling Entertainment recently found itself on the losing end of a state court lawsuit the Stamford-based company brought against toy and video game makers after a judge ruled, in part, that the company waited too long to bring their claims.
In a 27-page decision issued in late August, Stamford/Norwalk Superior Court Judge Taggart D. Adams granted the defendants’ motions for summary judgment in the antitrust case heard on the Complex Litigation docket.
The case involved Stanley Shenker & Associates Inc., which served as a licensing agent for WWE from 1995 to 2000; Jakks Pacific Inc., a seller of action figures and toys; and THQ, a marketer and seller of video games.
A federal suit by the WWE had alleged that Jakks and Shenker entered into a secret agreement that led to Shenker taking bribes from Jakks in exchange for toy and video game licenses from the WWE. THQ allegedly entered into a joint venture with Jakks to obtain a video game license in 1998.
There were also allegations that the defendants blocked communications and bids from other competitors who sought the video game license from reaching WWE management. This blocking was allegedly achieved with the help of a former WWE employee who was in charge of licensing and merchandising.
The federal suit was dismissed in 2006 for WWE’s failure to prove it suffered an antitrust injury. The Connecticut Antitrust Act requires proof of the same type of antitrust injury as does federal law, and Judge Adams dismissed WWE’s claims in the state court case. He also ruled that the four-year statute of limitations period expired before the antitrust claim was brought.
The defendants’ legal team was led by Jonathan J. Lerner of Skadden, Arps, Slate, Meagher & Flom in Manhattan, assisted in part by Connecticut attorneys from Pullman & Comley; Zeldes, Needle & Cooper; and Levett Rockwood.
-Douglas S. Malan
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