Source: The Wrestling Observer Newsletter

UPDATE: We reported last week (see below) that there were some contract issues between Rey Mysterio and WWE. According to sources, all standard WWE contracts have a clause where the company can extend the contract based on wrestlers not performing for long periods of time due to injuries or walking out. Vince McMahon renewing Rey Mysterio's contract is something that was specifically mentioned in his deal and all other standard deals with the company. A lot of people questioned whether Vince automatically extending his contract without him agreeing to it was even "legal." It is for the reasons we just reported.

For what it's worth, they could do the same thing with CM Punk's contract when it expires later this month. It remains to be seen what they do with him and his contract.  The advantage of re-signing him to a deal is that they could keep him from working for any other promotions and would basically still control what he can and can't do. The disadvantage to extending his contract is that they’d have to pay him his downside guarantee. As of now, that downside wouldn't be all that much as he’s simply refusing to work.

We'll keep you posted as we hear more but things could get interesting .....

ORIGINAL: Last week it was reported that Vince McMahon renewed Rey Mysterio's WWE deal for one year. According to that story, Rey's contract was set to expire, but WWE contracts may be frozen in the event of an injury. Since Mysterio has missed so much time during the course of his deal due to injuries, word was that WWE felt that Mysterio "owed them time" and he was renewed through May of 2015.

According to sources, there is more to the situation than what it already out. While there are not a lot of details at this time, there is a potential legal issue that has not played out. Mysterio was looking at leaving with the expiration of his contract, but then McMahon renewed the deal. WWE has Mysterio on the injured list, and there has been no talk about his potential return.

More on the story as it develops…