WWE have made the latest move in their case with MLW.
On March 6, MLW filed an amended lawsuit against WWE alleging that WWE has violated Sherman Antitrust act as the U.S. market for pro wrestling media content. This was a change from the original statement, which was against pro wrestling in general.
On April 7, WWE moved to dismiss the amended lawsuit, arguing that MLW still “failed to allege antitrust claims for monopolization or attempted monopolization,” under the conditions defined by the law.
WWE filed an accompanying statement with regard to the amended lawsuit.
First, MLW’s proposed market definition remains fatally flawed. MLW alleges a relevant product market around “the sale or licensing of media rights for professional wrestling programming.”
In layman’s terms, MLW asserts that networks and streaming services do not consider television content featuring professional wrestling to be reasonably interchangeable with other forms of television content. However, MLW again fails to allege any facts suggesting that media companies view wrestling shows any differently from courtroom dramas, zombie shows, scripted reality shows, or other kinds of fictional programming. This Court dismissed MLW’s first complaint because it failed to plead “allegations addressing why other ‘sports entertainment’ or media’ content for which broadcast rights might be sold to distribution channels are not appropriate substitutes.” That same deficiency remains and the Court should, once again, dismiss MLW’s antitrust claims for this reason alone.
Second, MLW’s assertion that WWE possesses or has a dangerous probability of obtaining monopoly power remains equally flawed. The Court found that MLW included only “bare” allegations of high market shares and failed to sufficiently allege direct evidence of monopoly power.
Even if the Court accepts MLW’s botched attempt at defining a narrow market around professional wrestling shows, the FAC continues to lack any non-conclusory allegations that WWE wields market or monopoly power over the hundreds of networks and streaming services with which it has no commercial relationships.
Third, MLW has not alleged any anticompetitive conduct. MLW now asserts two theories of such conduct: (1) WWE foreclosed MLW from the “key” or “favored” networks and streaming services, which are the direct customers for wrestling media rights; and (2) WWE foreclosed MLW from vital input markets – wrestlers and arenas – that it needs to produce the television content that it sells to networks and streaming services. Neither theory passes muster.
• No matter how much MLW attempts to narrow the pool of potential purchasers through conclusory labels such as “key” or “favored,” MLW can never plausibly allege that WWE’s purportedly exclusive contracts with just FOX and NBCUniversal prevent it from selling to the numerous alternative purchasers of media rights (including channels and platforms owned by Disney, Netflix, WarnerBros/Discovery, CBS, and Amazon) with which WWE has no alleged commercial relationships.
Indeed, MLW could never plausibly allege this because, based on the FAC, MLW never attempted to sell its media rights to any of these companies. Furthermore, MLW refutes its own allegations when it admits that it successfully sold its linear television media rights to a cable network.
• MLW’s attempt to allege input foreclosure trips at the starting line. MLW does not even attempt to define relevant markets for wrestlers or arenas, thus providing no possible basis to measure foreclosure from either input. Furthermore, MLW does not attempt to plead even one instance of WWE unlawfully interfering with MLW’s contracts with professional wrestlers or venues. Indeed, MLW does not allege that WWE ever prevented it from securing a single venue.
Fourth, MLW continues not to allege any harm to “competition at large.” As the Court is well aware, the antitrust laws protect competition, not competitors, yet the FAC still fails to allege any plausible facts demonstrating harm to the competitive process. Indeed, MLW has now pled that the competition to sell media rights has intensified since MLW first filed its complaint last year, with MLW and WWE’s other alleged competitors securing new, material media rights agreements.
Separate from the antitrust claims, MLW raises California state law claims for intentional interference with contractual relations, intentional interference with prospective economic relations, and a violation of the UCL. As before, this Court should dismiss those claims for lack of subject matter jurisdiction. As the allegations in the FAC are otherwise unchanged from the original complaint, WWE refers the Court to its arguments in its prior Motion to Dismiss and incorporates those arguments by reference herein.
WWE
We will have to wait and see what comes next for WWE’s lawsuit with MLW.
Follow Corey at @CoreyBrennanBS on Twitter
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