XFL founder and
World Wrestling Entertainment Inc. CEO Vince McMahon on Tuesday fired back in a breach of contract suit brought by the league's ousted commissioner, arguing that McMahon fired him because he "effectively abandoned his responsibilities" during the COVID-19 pandemic.
Former XFL Commissioner Oliver Luck hit McMahon with the suit in Connecticut federal court last month, claiming he was wrongfully terminated and
is still owed $23.8 million from his contract. In his complaint, Luck disputes McMahon's reasons for his termination, which happened before the league
filed for bankruptcy.
Luck has also requested a prejudgment remedy to secure the money he seeks from McMahon. He also asked the court to require McMahon to disclose assets "sufficient to satisfy said prejudgment remedy."
McMahon on Tuesday tore into that request, saying Luck can't establish probable cause that a judgment will even be entered in his favor. McMahon said he is not obligated to pay Luck under the guarantee because the firing was justified, adding that in March, Luck deserted his responsibilities as the CEO and commissioner "at a time when the league faced its most significant crisis — the threat to its business caused by the COVID-19 pandemic."
"During this critical time for the XFL, Luck decided to leave Connecticut and did not devote substantially all of his business time to his XFL duties as required by the contract," McMahon said.
And Luck failed to follow multiple XFL policies and directives, including the player personnel policy and policies prohibiting the use of league electronics for personal use, McMahon said. He pointed to Luck's signing of Antonio Callaway, a move that was a violation of the XFL's policy and McMahon's directive "not to hire players with questionable or problematic backgrounds."
Callaway, a former
Cleveland Browns quarterback, was suspended by the NFL in 2019 for violating its substance abuse policy. He was later released by the Browns for purportedly arriving late to team meetings and practices.
McMahon called Luck's prejudgment remedy bid "a wholly unnecessary and baseless attempt to obtain a prejudgment remedy against McMahon on an expedited basis in the middle of a pandemic that has curtailed this court's operations."
McMahon "indisputably has the ability to pay any possible judgment," making the application unneeded. Specifically, he said he has over $1.2 billion in publicly disclosed assets, all of which is known to Luck and Luck's counsel.
"Indeed, a prejudgment attachment of McMahon's assets under the circumstances of this case would be a deprivation of McMahon's property rights for no reason at all in violation of his constitutional right of due process," McMahon said.
Paul Dobrowski of
Dobrowski Larkin & Stafford LLP, counsel for Luck, told Law360 on Wednesday that McMahon's statements on his client's termination are "meritless and weak."
"They're just downright wrong," he said.
McMahon guaranteed Luck's salary and bonus, which totals a little less than $24 million, Dobrowski said. McMahon waived his defenses to any action looking to enforce the guarantee but still refuses to pay, he said.
"This is a pretty straightforward case," Dobrowski said.
Meanwhile, Jerry McDevitt of
K&L Gates LLP, counsel for McMahon, called Dobrowski's comments "almost humorous."
"If the allegations were weak and meritless, and the case so straightforward, Luck would not need six different lawyers to show that, and they are still adding to their legal team, as they did following the hearing today," McDevitt told Law360.
"If the allegations were weak and meritless, and the case so straightforward, Luck would not need six different lawyers to show that," McDevitt told Law360, adding that Luck had added the sixth attorney to his team Wednesday.
According to the case docket, Luck moved to have Jared McHazlett of Dobrowski Larkin admitted pro hac vice on Wednesday.
McMahon
announced his relaunch of the ill-fated XFL in 2018. The league had initially folded after one season in 2001.
Luck is a former NFL quarterback who joined the XFL as commissioner in May 2018. He'd previously worked as an executive with the
NCAA and athletic director at West Virginia University. He helped launch the XFL, which aimed to be a spring alternative to the NFL.
The league kicked off
in February to some success, but its inaugural season was cut short by the coronavirus pandemic. The league reportedly shut down operations and laid off its staff before its corporate entity, Alpha Entertainment LLC, filed for Chapter 11 bankruptcy on April 13.
However, Luck isn't going after Alpha, which was founded by McMahon in 2017.
The league's format involves a 10-week regular season with a three-game postseason. According to Alpha, canceling the league's final five weeks of play in March cost it an estimated $27 million in ticket sales and game-day revenue. Alpha's revenue in 2020 was about $14 million, and its net losses were $44 million, according to bankruptcy filings.
McMahon is set to provide up to $3.5 million in debtor-in-possession financing so Alpha can pursue a Chapter 11 sale, per the filings.
Luck is represented by Paul Dobrowski, Vanessa L. Pierce and Jared A. McHazlett of Dobrowski Larkin & Stafford LLP and Andrew M. Zeitlin, Sarah E. Gleason and Joette Katz of
Shipman & Goodwin LLP.
McMahon is represented by Jerry S. McDevitt and Curtis B. Krasik of K&L Gates LLP and Jeffrey P. Mueller of
Day Pitney LLP.
The case is Oliver Luck v. Vincent K. McMahon, case number
3:20-cv-00516, in the
U.S. District Court for the District of Connecticut.
--Additional reporting by Zachary Zagger, Dave Simpson and Mike Curley. Editing by Orlando Lorenzo.
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