On June 15, the Wall Street Journal reported the WWE board was investigating a secret $3 million settlement that Vince McMahon reportedly agreed to pay to a departing employee with whom he allegedly had an affair, according to documents and people familiar with the board inquiry.
On July 8, the Wall Street Journal published another report stating McMahon "agreed to pay more than $12 million over the past 16 years to suppress allegations of sexual misconduct and infidelity." The payouts reportedly went to four women who were previously associated with WWE. The women reportedly "signed agreements that prohibit them from discussing potential legal claims against or their relationships."
WSJ reporters Joe Palazzolo And Ted Mann joined Busted Open Radio to discuss their reporting on the story.
When asked when they learned of the story, Palazzolo said, "Sources told us, it was in April, that WWE's board was investigating this $3 million agreement with a woman who worked with McMahon. It basically took from April until we published our story, to firm that up, get additional sources, and understand what it was that the board was doing."
Asked why they reported on the story, Palazzolo commented, "A couple of reasons. First of all, Wall Street Journal covers public companies. WWE is a public company, this is clearly a governance issue. We write for investors and when your board of directors is investigating something like this, it's pretty interesting. The board, it's a 12-member board, four of those members are insiders, meaning they work for the company, and eight are independent. When it comes down to it, Vince controls the company. There is a governance issue. It's important for our readers to understand what's going on. We knew these allegations, while the company is saying this is a consensual relationship with this woman, we started hearing about other issues that were not consensual. We feel those are things that need to be reported as well."
Mann added, "It's a public company and we're operating in an environment where there is very little tolerance for any sort of relationship of this type between a CEO or an executive and someone who is a subordinate, even if it is consensual because the power dynamic that exists is something that is proved to be dangerous. That's one of the ways in which all public companies have been representing that they are not really going to allow things like this to be swept under the rug anymore, and in this case, when it was something that was a total secret from the board, at least some members, we find it interesting and we want to dig and find out more."
Palazzolo continued the discussion of why the story needed to come out by saying, "These are situations, even if the company is saying it's consensual, talking about the first story, this person's livelihood is depending on remaining in the good graces of her boss. The risk that you run with this power imbalance is that maybe someone is doing something that they don't want to do, but they want to keep their job. On top of that, it's happening at the top of the company. It's happening with your chief executive and the relationship is well known within the company and they see that going on and you're always talking about 'tone from the top,' but it's a real thing. If you're seeing your chief executive is permitting this kind of conduct, but engaging and leading the way in it, that's a problem all the way down."
In the second report, it was revealed that "a $7.5 million pact with a former wrestler who alleged that Mr. McMahon coerced her into giving him oral sex and then demoted her and, ultimately, declined to renew her contract in 2005 after she resisted further sexual encounters." The wrestler and her attorney reportedly approached Mr. McMahon in 2018 and negotiated the payment in return for her silence.
The $7.5 million pact shocked both reporters.
"As we were reporting out which settlement agreements were existent. The fact that there was one for $7 and a half million was eye-popping. That's a figure that, in the murky world of NDAs, clearly suggests a big secret being kept. That was one of the red flags that signaled to us that we had to get to the bottom of what that was and what it was for. The actions behind it are pretty horrifying. To coerce a sex act and basically drive someone out of the company because they refused further advances, as this woman has alleged, that's all terrible behavior," said Mann.
When asked when they learned of the second set of documents, neither gave an exact date, but Palazzolo said, "While we were reporting on the first story, we heard allusions to other agreements that had happened, so there were women who were on our radar as potentially having been in these agreements and we continued to report that out. We had a call list of 100 people who we bothered and we learned of the agreement from a source last month and we continued to report it out."
Many fans commented that they were not surprised by the story given the Vince McMahon character on television. The initial story was picked up by most major outlets, but the second story didn't receive quite the same attention.
When asked about the response and some fans dismissing the story, Mann said, "I think it's a link to something we saw a lot on Twitter after the initial story, there was a lot of reactions saying, 'Oh, what do you expect?' or 'Look at the character he plays. It's essentially the same guy that this report depicts behind the scenes.' There was this sense of, not everybody, but some people, 'this shouldn't be a surprise. That's the whole brand.' I think it's a good question as to why this maybe hasn't broken through as much as it would if we were writing about an NFL owner."
Both men cited Dan Snyder as a recent example of an NFL owner facing allegations and the attention that story received.
McMahon has appeared on television multiple times since the first story, but has not been on television since the second story.
Asked about McMahon's appearances, Palazzolo said, "He's going to do what he's going to do. It's not going to affect what we're doing in any way, shape, or form. What I'm more interested in is, how does the talent feel? How do his employees feel about him doing that? There is probably a range of opinions, but I imagine it doesn't go over very well with them."
Fightful Select has more details regarding the backstage reaction to McMahon's television appearances.
Mann noted that he believes business partners are paying attention and Palazzolo said, "This cannot be something that they're not paying attention to. Anyone doing business with the company is paying attention."
It was reported by Denise Salcedo of Instinct Culture that Netflix had pulled the Vince McMahon docuseries off its slate.
Finally, when asked if they believe the story is done, Palazzolo said, "I think it's probably not done. We're continuing to report."
Asked if there was something bigger than a $7.5 million payout, Palazzolo said, "No, you're asking if there's something bigger than a $7.5, that's not something we have in our back pocket. We left it all out on the field on a story. There are a couple of things we are still reporting on."
Mann added, "Sometimes, this has happened in similar scandals elsewhere, there are people who have something to share who become a little more emboldened to talk about it once some of the first coverage has happened and we're still working to figure out if there are such people out there."
Fightful will continue to report on the allegations against Vince McMahon and the investigation as more is known.
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