1983: USA Network strikes its first programming deal with World Wrestling Federation Entertainment Inc. (then TitanSports Inc.). The contract includes a "first-refusal" clause that allows USA to match any competing offer for its cable rights.
February 1998: USA strikes its latest renewal for four WWF series. The contract includes the first-refusal clause, and it also allows WWFE to send a letter-of-termination notice as early as November 1999, which could allow WWFE to terminate its rights deal effective September 2000.
April 30, 1999: WWFE meets with Fox Broadcasting Co. executives to discuss the feasibility of a broad TV deal, including rights to the four series USA carries. The meeting was arranged by Endeavor Agency.
July 1999: Endeavor sets up a meeting between WWFE and Viacom Inc./CBS Corp., which includes discussions about forming a "strategic alliance" that would include TV and movie deals, plus talk of CBS/Viacom buying equity in WWFE.
Oct. 28, 1999: WWFE CEO Linda McMahon tells Stephen Brenner, then USA Network's co-president, that WWFE will send USA a contract-termination notice in November and it wants to "take a fresh look" at its current TV strategy. Brenner then pitches McMahon on the "breadth" of USAi's holdings, including Ticketmaster, USA Studios and USA Broadcasting.
Nov. 5, 1999: USAi chief operating officer Barry Baker calls Linda McMahon. He tells her USA Networks Inc. will waive its first-refusal rights if WWFE agrees to delay issuing the termination notice.
Dec. 1, 1999: Vince McMahon tells USA Cable president Stephen Chao that WWFE wants four things from USA: a deal for the XFL football league, a WWF-themed drama series, a late-night talk show and another weekly show. Chao pitches McMahon on USA's electronic-commerce capabilities.
Dec. 2, 1999: WWFE executives meet with Paramount Television Group chairman Kerry McCluggage and discuss the possibility of Viacom carrying WWFE programming and specials on Viacom networks including MTV: Music Television, The Nashville Network and United Paramount Network, along with a publishing and radio deal.
Dec. 13, 1999: WWFE and USA executives meet to discuss the framework for an expanded deal, including a "full-blown cable/first-run syndication series" that would run Sunday nights on USA. Brenner gives WWFE a two-page offer letter that proposes license-fee increases for four WWF series on USA, but includes no other terms.
Dec. 23, 1999: Senior USA and WWFE executives meet and WWFE president Vince McMahon says he found the license-fee offer for the four series "insulting." USA Networks Inc. CEO Barry Diller chastises Brenner and Chao, noting that WWFE is "entitled to more, and USA should do that." Diller tells his team to put together a cross-platform deal "in the best interest of USA and WWFE."
Jan. 6, 2000: McCluggage meets with WWFE executives at their Stamford, Conn., headquarters to talk in more detail about a strategic alliance, including XFL rights, renewing UPN's Smackdown deal, and producing an action-adventure show, specials, movies, music, home videos and pay-per-view shows.
Jan. 18, 2000: Baker e-mails Brenner regarding USA waiting more than one month to schedule another meeting with WWF. "Don't you think we owe them an answer?" Baker asks rhetorically.
Jan. 20, 2000: Brenner e-mails Linda McMahon, requesting a follow-up meeting to discuss renewal. They schedule a meeting for Feb. 17.
Jan. 24 through 27, 2000: McCluggage and Linda McMahon meet in New Orleans at the National Association of Television Programming Executives confab, and she shows him a copy of the first-refusal clause in USA's contract; McCluggage says he doesn't think the clause would prevent the companies from forming an alliance.
Jan. 27, 2000: Chao e-mails Diller, urging him to close a deal with WWFE. "Our clumsy USA process is getting in the way of a speedy conclusion to this. Because Vince is Vince.and we do not want to lose this, you should call Vince with as much detail as possible and shake hands," Chao writes. He suggests that USA invest $50 million in the XFL and form a "man-cable channel (digital)" based on WWF and USA libraries, as well as renewal of the four series at the same terms, "since we will plow investment into the cable channel and football."
Feb. 17, 2000: USA pitches a broad deal in a presentation to WWFE, including an hour-long series styled as "WWF Baywatch," a program called The McMahon Show and cross-promotion through Home Shopping Network and Sci Fi Channel.
Feb. 24, 2000: Viacom makes a presentation to WWFE, proposing moving four series on USA to TNN and MTV, a WWF drama series, TNN distribution of XFL games, international distribution of WWF shows, home-video distribution, a theatrical-development fund, PPV deals, radio syndication, print publishing and WWF events at Paramount theme parks; Viacom also discusses buying equity in WWFE.
March 6, 2000: Brenner e-mails Baker, saying, "I think it would be worth it for me to call [Linda McMahon] to try to get them to tell us what they are looking for." Baker responds, "No, we should wait for their offer."
March 16, 2000: Viacom and WWFE reach an agreement in principle for the strategic alliance laid out in the Feb. 24 meeting.
March 30, 2000: WWFE sends the termination letter to USA, effectively ending USA's contract in September 2000. WWFE and Viacom execs meet in Los Angeles to hatch a final agreement of proposed terms of strategic alliance.
April 2, 2000: WWFE and Viacom sign a letter of agreement for the proposed strategic alliance and a separate deal for Viacom to take a $30 million equity stake in WWFE.
April 3, 2000: WWFE notifies USA that it intends to accept the terms of the strategic alliance with Viacom, and it sends USA a copy of the offer.
April 12, 2000: Exercising its first-refusal rights, USA sends WWFE a copy of Viacom's offer with almost all of the deal terms not concerning the four series crossed out. Seeking to enforce its first-refusal rights, USA Cable files lawsuit in Delaware Chancery Court.
June 12, 2000: The trial begins.
Sources: Trial testimony, pretrial briefs
The smarter way to stay on top of the multichannel video marketplace. Sign up below.
Thank you for signing up to Multichannel News. You will receive a verification email shortly.
There was a problem. Please refresh the page and try again.