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McMahon fires back in Luck’s wrongful dismissal lawsuit

World Wrestling Entertainment chairman Vince McMahon (Credit: XFL)

XFL owner Vince McMahon has responded to former commissioner’s Oliver Luck’s wrongful dismissal lawsuit against him, claiming Luck was fired from the American spring football league “for cause” following the violation of multiple XFL policies and directives.

In a response to Luck’s suit, filed last month in Connecticut federal court, McMahon in particular outlined three examples where Luck was alleged to have not complied with league policies. The first was listed as “gross neglect” of the job, and McMahon said Luck “effectively abandoned his responsibilities” by moving from Connecticut, where XFL headquarters are located, to his Indiana home in March when the ongoing Covid-19 pandemic began to grow substantially in scope in the US. 

“At the very moment when his leadership as CEO was needed most, Luck did not devote substantially all of his business time to the XFL, as required by his contract,” said McMahon’s attorneys, Jerry McDevitt and Curtis Krasik of K&L Gates and Jeffrey Mueller of Day Pitney, in the response filing

The second factor McMahon cited was Luck’s approval of the XFL signing receiver Antonio Callaway after McMahon had said he did not want players in the league with troubled backgrounds. Callaway was suspended by the National Football League for violating that league’s substance-abuse policy. The receiver was later injured prior to the start of the XFL season, and McMahon claims after Callaway’s salary and medical costs were borne by the league, “the cost to the XFL of this episode of gross negligence was in excess of six figures.”

The third example McMahon, also the chairman of World Wrestling Entertainment, cited to justify Luck’s termination was personal use of an XFL-issued iPhone. 

“The XFL had more than ample reasons to terminate Luck for cause under his employment contract,” McMahon’s attorneys wrote. “Luck now seeks a windfall in this action by submitting an affidavit that is false and deliberately misleading in material respects.”

Luck’s five-year contract with the XFL called for a $5m annual base salary and a $2m guaranteed annual bonus, and he is now looking to recover $23.8m in salary and bonuses in his lawsuit. The former commissioner also says the XFL did not employ a 30-day cure period to address claims before termination on April 9. He is also seeking a prejudgment remedy to secure the sought-after money, something McMahon is also challenging.

“The current value of McMahon’s stock holdings is approximately $1.3bn – over 50 times the $23.8m prejudgment remedy that Luck seeks in his application,” McMahon’s attorneys wrote. “After receiving [McMahon’s stock disclosures] Luck’s counsel was still unable to articulate any reason for burdening the Court or harassing McMahon with this wholly unnecessary application other than claiming he was ‘protecting his client’s interest.’ The inescapable conclusion is that Luck is not seeking a prejudgment remedy because any good faith belief that he needs security for any judgment that may be entered in this action but rather to harass McMahon because he was terminated for cause.”

Luck, who had an extensive industry background with prior stops with the NFL, NCAA and West Virginia University, was the public executive face of the XFL and was meant to provide credibility to the revived entity. But as the league’s fortunes quickly crumbled and the XFL filed for Chapter 11 bankruptcy protection last month, the dispute between Luck and McMahon has quickly grown bitter.

“All of the evidence supports Mr. Luck’s claim that he was very much engaged in the XFL operations…and continued to devote substantially of his business time to XFL duties,” Luck’s group of attorneys said in their own filing. “Despite the fact that supposed deficiencies in performance described in the termination letter, if accurate, would have been susceptible to cure, neither [XFL business entity] Alpha nor McMahon provided Mr. Luck with the required 30-day written notice to effect the cure.”

XFL assets, primarily intellectual property, are now for sale as the bankruptcy proceedings continue.