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THQ Named In WWE 'Bribery And Racketeering' Lawsuit

THQ Named In WWE 'Bribery And Racketeering' Lawsuit

October 20, 2004 | By David Jenkins

October 20, 2004 | By David Jenkins
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More: Console/PC

Officials from World Wrestling Entertainment (WWE) have filed a fourteen count complaint against toy maker Jakks Pacific, two foreign subsidiaries of Jakks, THQ, a joint venture between Jakks and THQ, licensors consultants Stanley Shenker & Associates and Bell Licensing.

The suit alleges numerous violations of the Racketeer Influenced and Corrupt Organization Act; of the anti-bribery provisions of the Robinson-Patman Act; and various other claims arising under New York state law. The WWE is seeking treble, punitive and other damages, as well as the voiding of licenses to both Jakks and THQ.

The suit has its origins in 1998, when Shenker & Associates were acting as WWE’s licensing agent and James Bell was the company’s Senior Vice President of Licensing and Merchandising. WWE alleges it has found evidence that Shenker & Associates split its commissions with Bell on various licenses that were later recommend to WWE management by him.

It is also alleged that certain licensees had paid monies into a foreign bank account controlled by Shenker, while he was WWE’s licensing agent. Shenker has already been found guilty of committing serial perjury in order to cover up the alleged payments to Bell, and WWE has been granted a default judgment in their favor.

Further allegations have been made that a series of payments to Shenker’s foreign bank account by two foreign subsidiaries of Jakks related to the granting of licenses to create video games based on WWE properties " which were ultimately granted to a joint venture between Jakks and THQ. WWE allege that Bell ignored higher offers from Activision and THQ " forcing the latter into its partnership with Jakks.

THQ has commented on the lawsuit, saying that the company "believes the WWE is pleased with the manner in which THQ has managed their brand in the video game category." The company points out that it is not directly accused of any wrongdoing and that the lawsuit will have no effect on games currently scheduled for release, including the imminent WWE SmackDown! vs. Raw.

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