Class Action Lawsuit Against AEW May Move To Federal Court

AEW has a lot of things going on right now, and some of the action isn’t in the ring. A court case is also brewing with a few former talents, and the company could see things move to a different setting.

A class action complaint has been filed by Kevin Kelly and Brandon and Brent Tate, with the defendants seeking to transfer the case to federal court. This move is based on various factors, including AEW’s payment structure for talent and wrestlers, as detailed in recent federal court filings.

Post Wrestling reports that the plaintiffs submitted their complaint in late August to the Court of Common Pleas in Philadelphia against All Elite Wrestling, Tony Khan, and Ian Riccaboni. They claim that AEW misclassified its wrestlers and talent as independent contractors and allege wrongful termination for the Tate brothers, as well as defamation against Foote related to a comment made by Riccaboni on a Discord server regarding Foote’s promotion of The Sound of Freedom film.

Following the filing of the complaint on September 6, the defendants responded on Friday with a request to move the case to the Eastern District of Pennsylvania. The plaintiffs intend to request that the case be returned to the Court of Common Pleas in Philadelphia. “We plan to move to remand,” stated the plaintiffs’ attorney, Stephen P New, when contacted about the case.

Attorneys representing AEW, Tony Khan, and Ian Riccaboni assert that the case meets the criteria outlined in the Class Action Fairness Act. This act applies to any class action before or after the entry of a class certification order. To qualify under CAFA, the case must involve federal jurisdiction where the total amount in controversy exceeds $5 million and includes at least 100 members, with at least one member from a state different from that of the defendants.

The issue of misclassification is divided into two classes: “all current and former Talent,” which presumably includes non-wrestling talent, and “all current and former Wrestlers,” which pertains to wrestlers. These classes encompass all individuals who worked for AEW from September 1, 2022, to the present.

In a declaration from AEW’s Senior Vice President of Business Strategy, Chris Harrington noted that, during the relevant period, 290 individuals provided services as wrestlers or non-wrestling talent under independent contractor agreements, with total payments exceeding $60 million. This amount averages to approximately $207,000 for each wrestler and talent over the two-year period, although individual compensation may vary.

If AEW were to classify these individuals as employees, Chris Harrington indicated in the declaration that the company would incur a tax liability of at least 9.95% of the pay to the putative class members, resulting in more than $5.97 million in total. Additionally, AEW would face costs associated with employee benefits of approximately $18,125 per employee, amounting to about $5.26 million annually for the group.

With an estimated 30% allocated for attorney fees, AEW anticipates expenses totaling approximately $14.59 million, significantly exceeding CAFA’s minimum threshold of $5 million. As of this writing, AEW’s attorneys and public relations representatives have not provided any commenton the matter.