Vince McMahon & Nick Khan Sanctioned By Judge

Vince McMahon and Nick Khan have been sanctioned for destroying evidence by the judge overseeing the shareholder lawsuit related to WWE's merger with UFC under TKO that was completed in September 2023.

Within a 41-page opinion obtained by POST Wrestling, Vice Chancellor J. Travis Laster of the Delaware Court of Chancery found that Vince McMahon, Nick Khan, Triple H, Stephanie McMahon and Brad Blum used Signal, an encrypted messaging app, and the platform's auto-delete function to dispose of messages they had a legal duty to preserve. This was despite WWE's legal department issuing formal hold notices for executives to preserve their communications due to possible future litigation. As a result of the decision, the court will consider five facts to be presumptively true when the shareholder lawsuit goes to trial from June 8 to June 12.

Those five facts are as follows:

• Emanuel's promise to provide Vince with a continued role at any post-merger company after a transaction influenced Vince’s decision-making with respect to the merger.
• Emanuel’s offer of indemnification and other legal support related to pending federal investigations of Vince’s alleged misconduct influenced Vince’s decision-making with respect to the merger.
• Vince decided to pursue a transaction with Endeavor in 2022, before the Company initiated the strategic review process.
• Khan communicated with Emanuel between August and December 2022 to facilitate a transaction between WWE and Endeavor.
• Vince and Khan worked with Raine to steer the process toward a deal with Endeavor and away from other potential bidders.

The ruling ultimately means the case will be more difficult for the defendants as the burden is now on them to disprove the five facts, as opposed to the plaintiffs having to prove their allegations. "Clear and convincing evidence" must be used to disprove the five presumptive facts, which is a higher standard than the usual "preponderance of the evidence" for civil lawsuits. 

The lawsuit filed by WWE shareholders in November 2023 against Vince McMahon, Nick Khan, Paul "Triple H" Levesque, George Barrios, and Michelle Wilson alleges that Vince McMahon preselected Endeavor for a WWE merger as then Endeavor CEO Ari Emanuel (now TKO CEO) assured McMahon's future with the company in the months after McMahon's retirement from WWE due to a sexual misconduct and hush money scandal. It is alleged that this meant competing offers for WWE from Liberty Media and private equity firm KKR were not allowed to develop, preventing a competitive process from emerging over the sale of WWE. This, according to the plaintiffs, resulted in WWE shareholders being shortchanged.

If the plaintiffs win the case, WWE shareholders could be awarded millions of dollars. A judgement is not expected immediately after the trial ends, however, and a written opinion will likely be issued months after the trial.

Within the written opinion from Laster, it was noted that WWE executives turning on the Signal auto-delete function coincided with key events mentioned in the shareholder lawsuit. This included Nick Khan and Brad Blum changing their auto-delete timings with Vince McMahon after federal prosecutors reached out to WWE for information about McMahon's alleged misconduct on August 5, 2022. Then, following a lunch between Vince McMahon, Nick Khan, Stephanie McMahon, and Ari Emanuel to discuss a potential deal between WWE and Endeavor, Stephanie changed the auto-delete settings on her chat with Vince McMahon.

There were further instances of WWE executives changing their auto-delete settings on Signal in chats with Vince McMahon, while McMahon himself changed those same settings in chats with Nick Khan and Triple H one day after a special meeting of the WWE board was held on January 12, 2023 to discuss selling WWE.

It was noted in the judge's written opinion that McMahon's own deposition testimony did not help him as he said: "I was always told about the Signal, and it's good for business because no one can trace you and so forth. It's kind of like Proton. You can't find out much about the call or the text."

What is becoming an infamous text exchange between Nick Khan and Vince McMahon in February 2023 in which Khan appeared to direct McMahon to use Signal was also mentioned by Laster, who noted their testimony on the exchange was "notably strained." The exchange involved Vince McMahon messaging about creative plans for WrestleMania 39 over traditional text message when Khan replied with, "Langis." This prompted McMahon to write back, "What in the blue hell is 'Langis' lol," and Khan then instructed McMahon to read the word backwards.

In Khan's deposition, the WWE president claimed he had "no idea" why he had written "Langis." McMahon in his own deposition, meanwhile, claimed he didn't know what the word meant and that he would require a pencil to figure it out.