THQ Objects To Wrestling Contract Extension, Files Suit

THQ has filed a lawsuit against Jakks Pacific, the publisher's joint venture partner on its World Wrestling Entertainment licensing deal, disputing that Jakks was not authorized to make a unilateral decision to extend the WWE contract. Toy maker Jakks said Wednesday that it has notified World Wrestling Entertainment that it intended to exercise its supposed option to renew the WWE video game license, which is the foundation for THQ-published games such as Smackdown vs. Raw and Legends of Wrestlemania. The renewal would extend the contract beyond its current expiration date of December 31, 2009, by another five years to December 31, 2014. But Jakks said in a statement that THQ has objected to the toy maker's unilateral decision to move ahead with an extension. The publisher argues that Jakks was not authorized to make the decision on behalf of both companies, and that THQ has no obligation to renew the WWE contract. THQ also disputed a term of the contract that said THQ is not permitted to publish any wrestling video games as long as one year after the termination of the WWE license. Jakks said that it has entered arbitration proceedings with THQ over the issues. The licensing of the WWE license has been a tangled web for years. In May this year, WWE lost its appeal in an ongoing legal battle versus Jakks Pacific and THQ, as a court again refused to find Jakks Pacific and THQ guilty of bribery, antitrust, and conflict of interest, among other charges. In 2008, THQ won a suit against Jakks over royalties related to WWE titles. The suit was originally filed in 2006.