WWE Lawsuits Draw Discovery Sanctions

The United States Court of Appeals for the Second Circuit affirmed the award of sanctions imposed against a law firm that had sued the World Wrestling Entertainment and Vince McMahon

Over the course of several months in 2014 and 2015, Appellants-Cross-Appellees Konstantine W. Kyros and his law firm, Kyros Law P.C. (together, “Kyros”) filed, in jurisdictions across the country, class action lawsuits and wrongful death lawsuits against Appellees-Cross-Appellants World Wrestling Entertainment, Inc. and Vincent K. McMahon (together, “WWE”), asserting various tort claims that related to chronic traumatic encephalopathy (“CTE”) in former wrestlers. In 2016, Kyros filed an additional mass action lawsuit on behalf of fifty-three former wrestlers, asserting a wide range of tort claims. See Laurinaitis v. World Wrestling Entm’t, Inc., No. 3:16-cv-1209-VLB (D. Conn.) (“Laurinaitis”). These lawsuits were all eventually transferred to the United States District Court for the District of Connecticut. We previously affirmed the district court’s dismissal of the Laurinaitis complaint and dismissed Kyros’s appeals of the other consolidated cases against WWE for lack of jurisdiction. See Haynes v. World Wrestling Entm’t, Inc., 827 F. App’x 3 (2d Cir. 2020).

The present appeal concerns only the district court’s awards of sanctions in Laurinaitis and Singleton v. World Wrestling Entertainment, Inc., No. 3:15-cv-425-VLB (D. Conn.) (“Singleton”), one of the class action lawsuits. At an earlier stage of the case, the district court (Vanessa L. Bryant, Judge) ruled that Kyros had repeatedly engaged in pleading and discovery misconduct and decided to impose sanctions in Laurinaitis under Rule 11 of the Federal Rules of Civil Procedure, and in Singleton under Rule 37. Although Kyros challenged these orders in the previous appeal, we dismissed that portion of his appeal because the district court had not yet entered a final order that fixed the amount of sanctions. See Haynes, 827 F. App’x at 11. Following our decision, the district court (Jeffrey A. Meyer, Judge) adopted a recommended ruling of a magistrate judge 7 (Robert A. Richardson, Magistrate Judge) and awarded sanctions to WWE in the amount of $312,143.55—less than WWE’s requested amount of $533,926.44. McCullough v. World Wrestling Ent., Inc., 2021 WL 4472719, at *1, *4–5 (D. Conn. Sept. 30, 2021). With the amount of sanctions calculated, we now consider Kyros’s appeal of the Rule 11 and Rule 37 sanctions and WWE’s cross-appeal, which challenges the district court’s application of the forum rule to award less than the requested amount of sanctions.

On appeal of the District Court’s sanctions, the law firm sought reversal; the WWE sought an increase.

On the record before us, we find no abuse of discretion because the district court ordered sanctions based on pleading defects that WWE had identified in their motions seeking Rule 11 sanctions.

No out-of-district counsel increase was warranted

WWE argues that, even if the forum rule applies, WWE is subject to an exception under Simmons because out-of district counsel “likely (not just possibly) produce[d] a substantially better net result” than local counsel would have. 575 F.3d at 172. Citing out-of-district counsel’s extensive experience representing WWE and litigating CTE matters, WWE asserts that no local counsel had comparable specific knowledge, nor could local counsel have improved upon the results achieved below. The district court acknowledged out-of-district counsel’s “longstanding involvement in defending claims brought by former wrestlers,” Special App’x at 281, but, as discussed above, concluded that WWE failed to show that out-of-district counsel likely produced a substantially better net result, especially where the case was dismissed based on deficient pleadings and conduct during discovery—that is, egregious litigation misconduct that in-district counsel would have been equally well placed to identify and oppose. Once again, we see no reason to fault that determination, made within the district court’s broad discretion.

Having carried out our “highly deferential,” H.C., 71 F.4th at 125, review of the district court’s efforts to achieve “rough justice,” Fox, 563 U.S. at 838, in keeping with the goals of fee-shifting, we affirm the district court’s application of the forum rule under the circumstances of this case.

(Mike Frisch)