Go to new challenger circuit. Fight your way through also unlocking The Bumblebee man and Moe until you fight Kang. Run around in circles until the o on your life meter lights up and press x then o. Keep doing this until you kill him. You'll then be able to defend your title.
First, you need to unlock Bumblebee Man and Moe by winning the Challenger Circuit, next unlock Prof. Frink and Flanders by winning the Defender Circuit, and then win the Champion Circuit. You will obtain a menu that has an arena select, and allows you to play as the bonus characters, Burns and Smithers, the aliens Kodos and Kang, and the Mega Secret characters, Itchy and Scrathy.
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