My post on the WWE lawsuit involving three former wrestlers known as Raven, Kanyon and Mike Sanders has drawn extraordinary interest. (Although I used to follow things when I was younger — Jimmy "Superfly" Snuka was among my favorites — I must say I haven’t followed it closely lately.)
But along with the interest, I’ve seen rampant speculation about what the lawsuit is about and what the WWE’s motion means. So here’s a quick guide to some FAQs:
1) WWE Filed a Motion to Dismiss That Sounds Pretty Good. Is It Likely that WWE Will Win?
No. Lawyers file these motions routinely and their job is to be an advocate, not necessarily spell out the other side’s arguments. Wait until the wrestlers file something before making that determination.
In fact, winning a motion to dismiss is pretty tough this early in the case. The courts have a fairly high standard that parties need to reach in order for cases to be dismissed this early. Courts typically like to allow parties to develop the facts about a case, than dismiss it this early.
2) If WWE Loses Its Motion to Dismiss, Does That Mean that the Wrestlers Win?
No. In fact, the issues that the court will decide now won’t really go to the underlying facts; it’ll rest more on what the law is. Again, the standard to defeat a motion to dismiss is pretty low so don’t be surprised to see the WWE’s motion fail. All that means, however, is that the parties will engage in discovery (taking depositions, exchanging documents), etc. Then WWE can file a "motion for summary judgment" that will say there is no dispute on certain facts and based on those facts, we should win. Even if WWE loses that motion, the case will still just proceed to a trial.
3) What Is the Difference Between an Independent Contractor and an Employee? And Why Does This Matter?
There are a variety of tests that courts use to look at the issue, but the IRS has set forth a variety of factors to look at to make that determination. But it’s pretty much fact specific (which tends to mean that courts frown upon motions to dismiss). The IRS’ general rule is that "an individual is an independent contractor if you, the person for whom the services are performed, have the right to control or direct only the result of the work and not the means and methods of accomplishing the result." (You can read all of the factors here.)
It matters because employees are typically entitled to certain terms and conditions of employment, such as benefits, vacation days, etc. It’s unclear from the papers filed on behalf of the wrestlers exactly what they are seeking. Because the wrestlers are asking to represent a class of other wrestlers, a court ruling court affect ALL of WWE’s wrestlers under booking contract. But it’s much too early to predict whether that will be the case.
4) Can You Tell Me More About the Attorneys and Judge Involved?
The main attorney for WWE is Jerry McDevitt, from the lawfirm of K&L Gates in Pittsburgh, PA. He’s well-respected in the field and the firm has over 1700 attorneys world-wide. (I should note that the local attorneys in the case are from Day Pitney, a prior employer of mine and well-respected in the Connecticut area as well.)
The wrestlers are represented by David Golub and Jonathan Levine of Silver, Golub and Teitell LLP. They are hardly slouches either and many Connecticut readers will remember that they brought suit on behalf of thousands of state workers earlier this decade affected by state layoffs. They’ve handled sophisticated before and this case is certainly not out of their league.
The judge is United States District Court judge Peter Dorsey, his bio is available here. Judge Dorsey was appointed United States District Judge for the District of Connecticut on July 29, 1983 and became Chief Judge in August 1994. (He has since moved on to Senior Judge status.) He received a Bachelor of Arts degree in 1953 from Yale University and an LL.B. (law) degree in 1959 from Harvard University School of Law. Although he’s handled thousands of cases, he may be best known for his handling of various criminal cases, including the corruption charges against former Connecticut governor John Rowland. As for the timing of deciding motions, he has indicated in his chambers practices that he does not have any internal guidelines regarding the time for disposing of motions.
5) What’s Likely to Happen Next?
The wrestlers will likely file their papers opposing WWE’s motion by mid-November. WWE will then have the opportunity to respond to that brief as well. A court decision on the motion to dismiss may take weeks or months to decide. Anyone anticipating a quick outcome on this will likely be disappointed.
6) Why Is This Case Important to Other Employers?
There are plenty of other companies (in the sports/entertainment industry and elsewhere) that rely on booking contractors or similar contracts to try to keep individuals from attaining employment status. An end result of this case (and this might be a LONG way away) might be that the court says that the booking contracts notwithstanding, the individuals should’ve received employment benefits and the other privileges associated with employment. This could send a message to other employers to review the relationships that they have with various individuals.