wrestling / Columns
The Hamilton Ave Journal 09.06.08: Volume 1 – Issue 50
THE HAMILTON AVE JOURNAL
By JP Prag
Volume 1 – Issue 50
ABOUT THE JOURNAL
The Hamilton Ave Journal is the only wrestling news report focused solely on the business of wrestling. Here in the Journal we not only look at the stories that are important to the investor and business-minded person, but also delve deeper into stories that most fans of wrestling would overlook. That is because the Journal is about getting the heart of the matters that affect the companies and outlooks of the wrestling world.
And where is Hamilton Ave? That is the location of the WWE Production Studio in Stamford, CT, and thus the most powerful place in the wrestling world. Besides, The East Main Street Journal just does not have the right ring to it.
Who am I? I am JP Prag: consultant, entrepreneur, businessman, journalist, and wrestling fan.
Now, ring the bell because the market is open.
WHAT’S NEWS
The Journal’s front page area known as What’s News isn’t just about telling you what has happened. The stories in this section are about what will have an effect on the wrestling industry, individual federations, and the wallets of the fans.
LEAD STORY: A continual look at Raven’s Employee Flock
For several weeks, the Journal has been covering in great detail any and all information about Scot Levy, et al’s lawsuit against the WWE in order to gain employee status. For further detail on this case, please see Issue #47 and Issue #49.
As expected, the release of legal documents thank to the Sun UK has let to a variety of additional notes, concerns, and comments. Given the large amount of feedback, the Journal has decided to dedicate time in the Lead Story to address several points brought up by the readers. Crimefighter began the cycle with this point:
Hey you forgot these important details –
The WWE makes the wrestlers adhere to a dress code when traveling during their off-hours.
The WWE tells the wrestlers where they can and can’t go during their off-time — see Robbie McAllister.
Those were not specific examples brought up in the legal documents which is why they were not mentioned, but you can believe that they will be brought up in court. Independent contractors decide where and when they work, as well as how the dress and where they go when they are not at a client site. Having control of a person’s time even when they are not working for you can be constituted as employee control.
On the other hand, the WWE may argue that travelling is work time for them and that the plane is a client site. When a wrestler is on a plane, they are “performing” in that respect. Also, in Robbie McAllister’s case, the WWE can plainly show that the entire town of Orlando was their client site for the weekend and that a competitor gained an advantage with their intellectual property represented in Mr. McAllister.
Guest#8221, though, chose to focus in one particular aspect:
So WWE is being sued because they do drug testing (among other things)? It seems like WWE can never do anything right. Everyone has a problem with the WWE for whatever reason, from the government to smarks to disgruntled ex-employees who never got over in the WWE, wrestled and lived dangerously and now in the twilight of his career he needs some pocket money. Whether WWE’s wrestlers should be considered independent contractors or employees means nothing if the wrestlers don’t realize that they need to change their lifestyles. It’s sad to hear so many wrestlers dying young with hardly any money in their bank accounts or wrestlers that have to resort to public fundraisers to help cover the cost of medical procedures.
The point of the lawsuit is not to say that wrestlers should not submit to drug screening. The point is to say that if they are they should be classified as employees and, as such, should receive all of the benefits of being an employee. This suit is not one to make wrestlers be independent contractors and take away what the WWE is doing to/for them, but to make them employees and let the WWE do whatever they want. The WWE is doing whatever it wants anyway, so the lawsuit contends that these people should receive all benefits of being a full time employee. You have good points, and it is most likely these men do need money. Scott Levy is an admitted recovering drug abuser with health and money issues, but Brett responded to your thoughts:
While I do think that Raven, Kanyon, and Sanders are doing this for a monetary gain, I don’t think its because they don’t have enough money. If they didn’t have enough money I doubt they’d be willing to put forth the money that its going to take to pay for this case which will probably last years. They are also probably doing this for the wrestlers that can’t or won’t do it.
That is the important part in this: time. This case will take years, and all three men and their lawyer need to subsist for years to come. They will continue to wrestle or do whatever other work they do now, but they will know they will not be working for the WWE (and most likely not TNA or ROH either) anytime in the future. Raven and Kanyon have often made comments about wanting to change the industry and it looks like this time they are trying to actually do something instead of just talking about it.
Guest#1081 also responded to the issues of drug testing:
Yes. If someone is an independent contractor, they have no boss. Imagine hiring a painter to paint your house, and then telling him he needs to take a drug test first.
You can’t do that. They do. That is why this lawsuit exists. The WWE does numerous things only employees have to suffer through (mainly control).
There is a bit of a misnomer here, though. This reporter has been hired as an independent contractor before and has had to take a drug test and pass a background check before being allowed to begin work for the client. That said, those were one-time items before the work officially began and never came up again (until contract renewal time). The WWE has taken people already under contract and submitted them to random drug testing that is now watched over by someone. Those were not terms the independent contractor agreed to and yet the WWE enforces it. Because of this, it would seem the WWE has taken on an employer role instead of a contract-owner role.
Now, the issue exists out there that wrestlers have jobs similar to other independent contractors. Arnab brings up the point:
What I think though is that the same arguments as the Raven lawsuit can be given by all the TV actors also, and they can also ask for employment, as also the Hollywood actors, specially those who get a 3 film or 5 film deal with a particular actor.
Here is the difference: actors, writers, and the like all belong to the Screen Actors Guild or another similar union. The union negotiates on its members’ behalf and the members have the rights to choose what projects they work for. So, although Robert Downey Jr. may sign a five picture deal, he does not have to work them. The terms have been agreed to on what he’d be paid should they happen, but he can delay them if he chooses. At the end of the day, the studio has “schedules” and times and places they expect the actor to be, but those are terms agreed between them. The studio does not withhold their taxes and does not maintain 100% control over the intellectual property (see: residuals). Meanwhile, even while working on Iron Man, Mr. Downey can negotiate another film deal with a different studio. It is up to him to complete the work when he is able to.
There are consequences for not fulfilling the contract, but those are contractual clauses. Should. Mr. Downey walk out during the filming of the second movie, the studio would have the right to sue him for irreparable damages and the breaking of contract terms. But that would be a civil case that would be resolved in state courts. Still, you cannot force someone to work as that goes against the Thirteenth Amendment.
But when comparing closer to the WWE, one would have to look no farther than sports teams. Last week, the Journal presented Just Adam‘s point:
How is what the WWE is doing for their contracted talent different from players contracted to the NFL, MLB, etc? Most (all?) of what you described seems to apply to these leagues as well, specifically how the athletes get paid while injured and the risk of “losing their spot”. The behavioral category that was given is practically identical to the WWE and professional sport leagues (ongoing evaluations, preseason training, more detailed degree of instructions). If the big “real” sports leagues can get away with similar tactics, what makes you think things will change for the WWE?
BLUEDAY takes the first crack at a response:
Here is the difference. Those leagues have full health benefits, a pension, and have their taxes removed from their pay, the team charters flights for the team and don’t have to pay for travel, even minor league players receive “meal money” daily. None of those are in The WWE. So, yeah they are nothing alike at all.
Not only that the lawsuit is ASKING that they be treated as those athletes.
Of course, what BLUEDAY comes short of saying is that those who work for the NFL, NBA, MLB, and other professional leagues are, in actuality, “employees” of the team. Although they have contracts, they are contracted employees which is perfectly legal in the current IRS system.
In order to confirm this point, the Journal contacted sports historian and writer Jason Clinkscales, purveyor of A Sports Scribe, independent contractor for the The New York Beacon, on air sport talk personality for WHCR, among many other credits. Mr. Clinkscales assured the Journal that players in the NFL, NBA, MLB, and other organization are employees of their respective teams and have been for decades—although the time differentials between the leagues is great.
The only professional sports that he said they were not employees were the PGA and tennis. Since in both of those sports the athletes decide into which tournaments they will enroll (hence when and if they will work), they remain independent contractors.
And much like SAG, the players associations of these leagues act as bargaining agents for the employees. In the pre-amble of the NFL Players agreement with wit the NFL it states:
This Agreement, which is the product of bona fide, arm’s length collective bargaining, is made and entered into as of the 8th day of March, 2006, in accordance with the provisions of the National Labor Relations Act, as amended, by and between the National Football League Management Council (“Management Council” or “NFLMC”), which is recognized as the sole and exclusive bargaining representative of present and future employer member Clubs of the National Football League (“NFL” or “League”), and the National Football League Players Association (“NFLPA”), which is recognized as the sole and exclusive bargaining representative of present and future employee players in the NFL in a bargaining unit described as follows:
1. All professional football players employed by a member club of the National Football League;
2. All professional football players who have been previously employed by a member club of the National Football League who are seeking employment with an NFL Club;
3. All rookie players once they are selected in the current year’s NFL College Draft; and
4. All undrafted rookie players once they commence negotiation with an NFL Club concerning employment as a player.
The key word is “employed”, not “contracted”. In a contract like this, one can imagine that lawyers have carefully monitored every single word. They would not allow the word “employee” if they did not mean “employee”.
So yes, while Just Adam wrote the Journal many instances showing where the NFL was like the WWE, the bottom line is all of his points are moot because NFL players are employees. At the end of the day, all the notes made about the similarities between the two actually make the point that WWE wrestlers should be employees.
The one open item is that the wrestlers knowingly and willingly signed contracts that said they were “independent contractors”. Legal Eagle ties this one up:
Don’t forget that both Microsoft and FedEx tried the “They sign contracts saying they are independent contractors” defense, and both were struck down.
Absolutely true, and it happened again recently in the NFL (who had not learned their lesson) with their drug testers. They signed them as independent contractors and the IRS rules they were employees. Just because it is in a contract does not mean it is legal and/or binding.
Again, this is not going to happen overnight, but the WWE will have a tough time presenting a defense with so much precedent out there. As always, the Journal will monitor this case closely and appreciates all of the editorials around it.
Other Lawsuit Updates
Aside from the Scot Levy, et al, vs. the WWE lawsuit, there are two other major wrestling related lawsuits that had updates this week. First up, the discovery phase ended in Konnan’s case against TNA and has already led to an early judgment. Although there are many issues at stake with Konnan, the copyright infringement portion has been dismissed “with prejudice”. That means that Konnan never had rights to LAX and the intellectual properties he created while with TNA do, in fact, belong to TNA. The “with prejudice” portion means that Konnan does not have the right to file another suit with a similar claim. In other words, Konnan had to grounds to make the claim and will have no basis to make such a claim in the future.
The rest of charges remain open and will most likely go to court in October unless a settlement is reached beforehand. The courts have been trying to push both parties to a settlement, but at last check Konnan was looking for $3 million in damages.
Meanwhile, THQ/JAKKS Pacific sent out a follow-up press release to their announcement last week that almost all of the WWE’s charges against them have been dismissed. A number of charges were dismissed due to the statute of limitations on the claims. The rest of the charges were dropped at the state level because the WWE suffered no anti-trust losses and the federal courts had already decided the charges were not applicable. The federal charges were then dropped because the state ones were, so JAKKS remained successful in this round.
The WWE has already indicated that they will appeal again and JAKKS has said they will continue to “vigorously defend” against the appeal. Says Jack Friedman, Chairman and CEO of JAKKS Pacific:
“From the outset, we have maintained that WWE’s claims against us were meritless and part of an attempt by WWE to force us to relinquish our financial stake in our licenses. We have refused to be bullied into submission and are delighted that the Connecticut Court has granted summary judgment in our favor.”
Because of this ruling, JAKKS will maintain copyright control over several wresting related licenses that the WWE would like to control and will also be the maker of WWE toys until their contract runs out in 2010.
Newsbites
Some items of note in the rest of the wrestling business world:
MARKETPLACE
In the Marketplace we look at the trends in television ratings. This section is less for critical analysis by the Journal but more for the reader to see what is really going on and to draw their own conclusions.
As with stocks, here in the Journal we track the progress of television ratings. If ratings are the barometer by which we judge the product, then over the course of 52 weeks we should be able to see patterns, trends, and anomalies. Please note that gaps in the chart below are due to data not being released/available.
For the week ending Thursday September 4, 2008, here are the current standings of our shows:
RAW
Close (This Week’s Rating): 2.9
Open (Last Week’s Rating): 2.8
Percentage Change: ▲ 2.1%
52-Week High: 4.1
52-Week Low: 2.5
All Time High: 8.1
All Time Low: 1.8
SmackDown*
Close (This Week’s Rating): 2.3
Open (Last Week’s Rating): 2.1
Percentage Change: ▲ 9.5%
52-Week High: 2.9
52-Week Low: 1.6
All Time High: 5.8
All Time Low: 1.0
* SmackDown! ratings may include fast overnight if final ratings are not posted. Also, SmackDown! ratings are for the prior week as overnights are not available before this article goes to print.
ECW
Close (This Week’s Rating): 1.4
Open (Last Week’s Rating): 1.3
Percentage Change: ▲ 7.7%
52-Week High: 1.6
52-Week Low: 0.6
All Time High: 2.3
All Time Low: 0.6
TNA iMPACT**
Close (This Week’s Rating): 1.1
Open (Last Week’s Rating): 1.1
Percentage Change: UNCH
52-Week High: 1.2
52-Week Low: 0.9
All Time High: 1.2
All Time Low: 0.6
** TNA iMPACT’s are for the prior week as ratings may not be available at the time of the Journal’s posting
Analysis:
After an extremely down week, the WWE’s ratings began to climb back this week, but not by that much. RAW was hampered by the Labor Day holiday, or so the claim is. Last year, RAW actually climbed 12.5% from the prior week to score a 3.6 rating on Labor Day. In FY06, the rating also went up 5.9% from the prior week to a 3.6. Going back, the show also did a 3.6 in FY05, a 3.7 in FY04, and a 4.3 in FY03. So overall, history shows that Labor Day has generally been good to RAW and that ratings have usually gone up from the prior week. What went wrong this year? It is the same issue overall: shrinking market share combined with overexposure and lack of consistent growth. The WWE may try to blame the holiday this year, but it was never an issue before so why would it be an issue now?
MONEY AND INVESTING
We all know that wrestling is a business, but we don’t often pay attention to what sells and makes money. Money and Investing looks into the top selling items in the world of wrestling and any interesting figures that may have come out this week.
What are the top ten selling items for the WWE? From WWEShopZone.com:
1. Jeff Hardy Armbands ($15)
2. WWE Ultimate Rivals Trading Cards ($2)
3. WWE Black Gift Bag ($3)
4. Triple H Hammer T-Shirt ($25)
5. Hardys Purple Logo Pendant ($10)
6. John Cena Beware of Dog YOUTH Package ($66, on sale $37.95, double sale $27.98)
7. The Life and Times of Mr. Perfect DVD/T-Shirt Package ($54.99, on sale $23.99)
8. Edge Visor Beanie Cap ($20, on sale $11.99)
9. Hardys WWE Shop and Jakks Pacific Exclusive Action Figure ($34.99, on sale $24.99)
10. CM Punk Ribs T-Shirt ($25)
Well it was certainly a week for sales as the back-to-school market finally dried up. With all of the dollars spend on backpacks, messenger bags, folders, and notebooks, all that was left was a few good deals. But in a first here, CM Punk has finally broken in to the Top Ten! His Ribs T-shirt, which has been out for quite some time, apparently had enough volume in this down week to beat out much of the other items and be the last full-priced item on the list. Without the sales items, it may have actually faired better. This is an excellent sign for the current World Heavyweight Champion and it will be interesting to watch if he can maintain a spot in the Top Ten or if this is just a one-off thing.
TNA releases a list of Top Ten selling items, but the list has not been updated to current products in quite some time. Until TNA updates the list, the Journal will be take the list of featured products and sorting by most popular. When done so, the list comes up as:
1. TNA Global iMPACT DVD ($19.99 – OUT OF STOCK)
2. Bound for Glory 2008 FanFest Tickets ($40)
3. The Phenomenal AJ Styles Deal of the Century ($79.95)
4. AJ Styles “Unim Phenomenous” T-Shirt ($19.99)
5. Complete 100 Card Set ($24.99)
6. Nash “Big Sexy Tour” T-shirt ($19.99)
7. Sting “Logo” T-Shirt ($19.99) ($19.99)
8. Samoa Joe “Drastic Times, Drastic Measures” T-Shirt
9. Blaster Pack ($24.99)
10. Don West Post Labor Day Yard Sale
Another week gets hit with little movement as the AJ Style’s package refuses to sell out and everyone else stays about the same. The exception is premiering in the number ten spot with a mixed bag package for $100. TNA is again trying to clear out inventory instead of taking on the holding fees, and this is a very pertinent way to do it. Why sit around with piles of product when you can package them together and at least make a little money off of them? Of course, according to Don West there are only 75 of these items, so the fact that it made it to the Top Ten is disconcerting.
PERSONAL JOURNAL
Wrestling isn’t just about watching and reading. The best way to be a wrestling fan is to experience it live. Where is wrestling coming to in the next 2 weeks? The Personal Journal answers that question.
| Sunday | Monday | Tuesday | Wednesday | Thursday | Friday | Saturday |
7 (Sep) |
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10 | 11 | 12
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18 | 19
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20ROH Live (Philadelphia, PA) |
Do you know a wrestling event coming up? Send one in to The Hamilton Ave Journal and we’ll be sure to add it to the list.
EDITORIALS
The Editorials section is designed for you, the readers, to respond to the views presented in the Journal, send an important news item, or talk about another overlooked business related item in wrestling. Just beware: the Journal reserves the right to respond back.
From the commentary section last week, most was about Scott Levy’s lawsuit in the story above. Outside of that, Dingo wanted to know:
You know the all time highest RAW rating was 8.1; Do you know the date of that RAW? Is it the one with this is your life segment with Rock and Sock?
There were many answers, but Leon covered it best:
The 8.1 edition of Raw was on 5/10/99.
The card featured…
Billy Gunn vs. Kane (no contest)
Big Show vs. Paul Bearer (no contest)
(WWF Women’s Championship; Evening Gown Match) Debra d. Sable (c)
The Big Bossman d. Test
(Handicap Match) Cactus Jack d. Mideon and Viscera
(Lumberjack Match) Bradshaw vs. Farooq (no contest)
Pat Patterson and Gerald Brisco d. The Mean Street Posse
Jeff Jarrett d. Val Venis
Ken Shamrock vs. Chyna (no contest)
Steve Austin, Vince McMahon, and The Rock d. Shane McMahon, Triple H., and Undertaker
But what was more interesting was how the rating was scored, which SMYK filled in:
The show in question was in May 10th 99 when Nitro was pre-empted for the NBA playoffs. The Main was Austin, Rock and Vince VS Taker, Trips and Shane. Oh, and Big Show fought Paul Bearer!
Now the trivia question of the week: What was the highest rated RAW that went against Nitro and what were the circumstances around it?
Bonus trivia question: What was the highest rated Nitro and the highest rated Nitro that was against RAW and what were the circumstances around both?
While you are thinking about that, another debate is brewing. Black Scorpion started it off with his thoughts on the WWE “Employees” (should they become employees) having a union:
However, we must also look at all the evil unions have done in the past. While once they served a useful purpose, most are greedy and corrupt and just want money. Lets hope wrestling doesn’t get the union deal as in my state teachers are striking and the kids are the ones who suffer because their teachers aren’t getting enough pay (and they are paid HANDSOMELY) but because of their union status they work-to-rule and will not even do extra help or college recommendation letters until their fat paycheck gets fatter. So in other words, I hope the little guys win but don’t become as corrupt as most of the other unions that once set out to be just. Good theory, usually bad execution.
To which Paul responded:
Yeah, unions have done lots of bad things like demanding safe working conditions, a 40 hr. week, an end to child labor, fair wages, and time off for sickness.
If the WWE had a union for its workers maybe there’d be less drug abuse, fewer injuries, and more living ex-wrestlers. The only people unions hurt are robber barons like the McMahons.
Paul does have an interesting point. Unions are responsible for most of the fair labor laws we have to today. The issue is that most of what unions fought for in the past is already covered by law. Unions have shown a propensity in modern times to be corrupt, limit expansion and creativity, and make demands that are extremely detrimental to employers (who needs some profit motivation to stay in business). While a wrestling union at the beginning would help in establishing employee rights, protect time off, and make sure everyone has fair wages and retirement/severance packages, there is a lot of potential for abuse. Where do you weigh in on this issue?
Plenty more was written, so be sure to take a look. And of course, a week would not be complete without a good dose of JP Prag’s own HIDDEN HIGHLIGHTS!!
CLOSING BELL
This concludes Issue #50 (Volume 1) of THE HAMILTON AVE JOURNAL. Join us next week as we get ready to ring the bell again.
Till then!
