In recent SEC filings, TKO Group and its parent company Endeavor have acknowledged the potential risk associated with Vince McMahon's role in the new WWE/UFC umbrella corporation. Lawsuits filed against McMahon and other WWE principals by an Ohio pension fund and an individual investor have raised concerns for Endeavor directors and accountants, prompting a closer examination of the implications as they complete paperwork for investors and the government.

The Hollywood Reporter first shed light on one of these lawsuits on November 27th. The legal action alleges that McMahon and other members of WWE's board manipulated negotiations regarding the sale of the company, favoring Endeavor and pushing for a speedy transaction with McMahon's long-time ally, Ari Emanuel, who leads Endeavor. The suit contends that this "sham sales process" was orchestrated to ensure McMahon's continued position as TKO's Executive Chairman, while excluding other potential buyers who might have sought to remove him due to recent sexual misconduct and hush money scandals.

According to the lawsuit, McMahon and his allies on the WWE Board disregarded superior offers, including at least two all-cash proposals with more favorable terms, in favor of the agreement with Emanuel, whom they knew would enable McMahon to retain control over the merged UFC/WWE entity.

The legal action also names top WWE executives Nick Khan, Paul "Triple" Levesque, George Barrios, and Michelle Wilson, alleging that McMahon not only secured his own future at the post-merger WWE but also ensured financial gains for himself and his loyalists before finalizing the deal. The suit points to significant cash bonuses received by Khan, Levesque, and Frank A. Riddick upon the completion of the Endeavor merger as further evidence.

Overall, the lawsuit argues that the $9 billion sale to Endeavor was significantly undervalued, claiming that McMahon and his team failed to negotiate in good faith and ignored more favorable offers that should have been considered.

Bloomberg Law has also reported on a similar lawsuit filed by Dennis Palkon, a WWE shareholder who previously sued the company over McMahon's forced return to facilitate the sale at the center of his current legal action.

As of now, TKO and WWE have yet to respond to requests for comment on the lawsuits, leaving many unanswered questions regarding the potential consequences and required defenses against these legal challenges.

While it remains uncertain whether these lawsuits pose an existential threat to TKO, the ongoing federal government investigation into McMahon and his business dealings suggests that the issue is far from resolved, potentially impacting the stability of the merged entity. Endeavor and TKO Group now face the difficult task of navigating these legal battles while striving to ensure the success of their newly formed collaboration.