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Vince McMahon, the executive chairman of
World Wrestling Entertainment Inc., has agreed to a multimillion-dollar legal settlement with a former wrestling referee who accused him of raping her in 1986, according to people familiar with the agreement.
Mr. McMahon’s settlement with Rita Chatterton, completed last month, averts a public legal fight over her allegations as Mr. McMahon pursues
a possible sale of the company.
Ms. Chatterton, the first female referee of what was then known as the World Wrestling Federation, demanded $11.75 million in damages for the alleged rape in a November letter to Mr. McMahon’s attorney reviewed by The Wall Street Journal.
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World Wrestling Entertainment Inc. Chairman Vince McMahon appears in the ring during the WWE Monday Night Raw show at the Thomas & Mack Center August 24, 2009 in Las Vegas, Nevada. (Ethan Miller/Getty Images / Getty Images)
Ms. Chatterton agreed to a lesser amount in the millions of dollars, one of the people familiar with the matter said, but the Journal couldn’t determine the exact figure.
"Mr. McMahon denies and always has denied raping Ms. Chatterton. And he settled the case solely to avoid the cost of litigation," said Jerry McDevitt, a lawyer for Mr. McMahon.
Ms. Chatterton referred the Journal to her lawyer, John Clune, who declined to comment. WWE didn’t respond to requests for comment.
The deal follows
a $7.5 million settlement Mr. McMahon reached in 2018 with a former wrestler who alleged that he coerced her into giving him oral sex, as well as a 2022 agreement in which he agreed to pay $3 million to a former WWE employee with whom he allegedly had an affair, the Journal previously reported citing people familiar with those agreements. Mr. McMahon has declined to publicly address the settlements.
WWE has declined to discuss the allegations against Mr. McMahon. The company previously said it was cooperating with a board inquiry into the payments and taking the claims seriously.
Mr. McMahon contended in a 1993 lawsuit that Ms. Chatterton was induced to make a false rape charge against him by a wrestler with an ax to grind. Mr. McMahon withdrew the lawsuit the following year, he said, to focus on defending against criminal steroid-related charges. He was acquitted of those charges in 1994.
A New York law recently
opened a one-year window that allows victims of sex crimes to file lawsuits that would otherwise be barred by the statute of limitations. Ms. Chatterton’s attorney sought $11.75 million damages in a legal demand letter sent to Mr. McMahon’s attorney in November, weeks before the window opened.
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WWE Chairman and CEO Vince McMahon attends a press conference to announce a major international event, WrestleMania XXIX, at MetLife Stadium on February 16, 2012 in East Rutherford, New Jersey. (John W. Ferguson/WireImage / Getty Images)
The settlement provides Ms. Chatterton with a lump sum up front and annual installments, similar to Mr. McMahon’s previous agreements with women, the person familiar with the deal said.
Mr. McMahon stepped down as chairman and chief executive of WWE in July, after the Journal reported four secret settlement payments he made to women who accused him of sexual misconduct.
Mr. McMahon, the company’s controlling shareholder,
returned as WWE’s executive chairman this month and changed the company’s bylaws to give him greater authority over its operations and pursue a possible sale.
WWE’s board had resisted his return,
saying in a December letter that continuing investigations by the Securities and Exchange Commission and the Justice Department into the secret payments by Mr. McMahon counseled against it.
In the letter, the board said Mr. McMahon’s return "would not be prudent from a shareholder value perspective."
"This determination is based on a variety of factors, including non-public information the Board has become aware of and the risks to the Company and its shareholders of placing a greater spotlight on these issues," the letter said.
Mr. McMahon replaced three independent board members to make room for himself and two former WWE executives. Two other independent directors have since resigned, along with his daughter, Stephanie McMahon, who had been co-chief executive with Nick Khan. Mr. Khan is now the company’s chief executive officer.
The Journal reported in December that Mr. McMahon
was in talks with attorneys for Ms. Chatterton and a former spa manager who alleged Mr. McMahon assaulted her at a California resort in 2011, according to an email her lawyer sent to Mr. McMahon’s lawyer. The Journal couldn’t determine the status of the negotiations with the ex-spa manager.
Ms. Chatterton alleged in televised interviews in 1992 that Mr. McMahon had told her she needed to satisfy him to obtain a $500,000 contract with his company and raped her in the back of a limousine in New York.
Mr. Clune, Ms. Chatterton’s lawyer, said in the November demand letter that Ms. Chatterton had passed a polygraph and that multiple sources corroborated her account, two of whom confirmed to the Journal that Ms. Chatterton contemporaneously told them about the alleged rape.
An attorney for the former spa manager didn’t respond to a request for comment.
Vince McMahon attends a press conference to announce that WWE Wrestlemania 29 will be held at MetLife Stadium in 2013 at MetLife Stadium on February 16, 2012 in East Rutherford, New Jersey. (Michael N. Todaro/Getty Images / Getty Images)
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In the Nov. 3 legal demand, Mr. Clune wrote that the damage Ms. Chatterton had suffered from the alleged rape was "hard to overstate." Ms. Chatterton "has suffered years of ongoing depression, substance abuse, disordered eating, lost income, and overall a decreased quality of life," Mr. Clune wrote.
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