From what I remember this was not faked.

From the Wiki Page:

Schultz had a notorious encounter on December 28, 1984 with 20/20 reporter John Stossel while Stossel was backstage at Madison Square Garden doing a story about professional wrestling's secrets.[10] During an interview Stossel told Schultz that he thought pro wrestling was fake and Schultz's response was to hit Stossel in the head twice, knocking him to the floor each time.[3] Before the first hit, Stossel said, "I think this is fake" to which Schultz said, "You think it's fake?" and hit him the first time on his right ear.[3] Before the second hit Schultz said, "What's that, is that fake? Huh? What the hell's wrong with you? That's an open hand slap. You think it's fake? I'll fake you."[3] After the second hit, to Stossel's left ear, Stossel attempted to exit the scene, but Schultz proceeded to go after him, saying, "Huh? What do you mean, fake? What the hell's the matter with you?" as a man in the background says "Easy, easy" to calm Schultz down.[3] The attack, which attracted a large amount of media coverage, was later aired on national television including ABC News which reported that the network had received more than 1,000 calls from viewers inquiring about Stossel's health.[10]

Marvin Kohn, a deputy commissioner at the New York State Athletic Commission, had been present at the arena during the incident and immediately suspended Schultz for his actions.[10] Although called by Commissioner Jose Torres to come to a hearing before the Commission, Kohn later reported that Schultz had written a letter to the commission admitting "that he had acted improperly and apologized both to the commission and to Mr. Stossel" and further stated "I admit the allegations ... I intend the commission to know that I did not intend to hurt John Stossel. I apologize to the commission and to John Stossel."[10]

Stossel stated that he suffered from pain and buzzing in his ears eight weeks after the assault.[10] Stossel later claimed he was unaware of Schultz's apology and would pursue his action in court although commented he would be "less likely to sue" if the after-effects of his injury disappeared.[10] Stossel eventually filed a lawsuit against the World Wrestling Federation, and settled out of court for $425,000.[11] In his book, Myths, Lies, and Downright Stupidity, Stossel writes that he has come to regret filing charges, having adopted the belief that lawsuits harm hundreds of innocent people.[11][12]

Although he has consistently maintained that World Wrestling Federation officials told him to hit Stossel, Schultz was fired. Many industry insiders believe that it was not because of his actions against Stossel, but rather because he challenged Mr. T to a fight backstage at a WWF show at Madison Square Garden.[13]