Sports

Sports injuries: the concussion pandemic

Tue, 22 Apr 2025 11:01:00 +0100

(The following article by Fiona Hahlo was first published in Insurance Day on 16 April 2025).

The inherent risk of injury to participants in many sports is well known – you only need to watch a game of rugby or American football, or spectate a boxing match, to appreciate this. Participants must accept this risk to some extent, but, the acceptance is conditional. They rely on governing bodies to control and regulate the sport to minimise injury risk; clubs to enforce the rules; referees to ensure compliance; players to follow the rules; organisers to provide appropriate facilities; and clinicians, especially in professional sport, to administer appropriate treatment.

An area of key concern is head injuries, and the impact to participants of repeated concussive and sub-concussive injuries, which often occur due to collisions with other participants, falls or impacts with equipment.

Studies have shown a direct link between repetitive head injuries and the development of neurodegenerative disorders. There is now a real pandemic of athletes being diagnosed with life-changing conditions, which they claim are directly attributable to their participation in sport and, particularly, the failure of governing bodies to take the necessary action to protect them.

Global litigation

In the US, a class action by more than 4,500 former NFL players against the NFL alleged that despite knowing of the long-term health risks associated with concussion injuries, the league ignored and/or concealed this information from the players. It had a duty to protect the players and was negligent for failing to do so. The NFL denied liability, but settlement was reached in 2015 for an estimated $1billion. Similar litigation took place against the NHL in 2013, again with settlement being reached in 2019.

Here in the UK, there is ongoing group litigation involving former football and rugby players, who are suing the governing bodies of football and both codes of rugby (union and league) for failing to adequately warn players and protect them from the risks of repetitive concussive injuries. The claimants will need to prove that the governing bodies owed the players a duty of care, breached that duty by failing to take appropriate protective measures, and that this breach led to neurodegenerative disorders and consequent losses. This will require scientific and medical evidence to establish what was known at the relevant time. claimants are also likely to face significant legal hurdles, including defences such as volenti non fit injuria (consent to the risk) and contributory negligence, for example, where a player ignored medical advice to leave the field after a concussion

In Australia, the high-profile class action, Rooke v AFL Group Proceeding, is currently underway on a very similar theme.

Current management

Significant steps have been taken worldwide to address the issue of managing concussions. In the US, concussion protocols have been implemented to suit specific professional sports. For example, the NFL has a detailed Game Day Concussion Protocol. Outside of the professional arena, the US Centres for Disease Control and Prevention leads the HEADS UP initiative, which aims to educate participants in sports, coaches, parents and schools about concussion safety.

In the UK, there have been gradual changes over time. In football, header practice time has been reduced. In rugby, the laws in relation to tackle height have been changed, and head injury assessments and return to play protocols are in place and must be followed, with greater authority provided to doctors and match officials. The current protocol is that players should not return to play before 21 days post-concussion. Elite players now wear smart mouthguards, which alert an independent match doctor that a player has suffered a high force impact to the head. This enables appropriate action to be taken. Education and training are key, as well as ongoing research and monitoring. So far as grassroots sport is concerned, the government introduced UK Concussion Guidelines in 2023, with the slogan 'If in doubt, sit them out', to ensure a concussed player is removed from play and appropriately assessed and treated.

In Australia, similar concussion protocols and guidelines have been implemented across various sports to manage risks. For example, helmets in cricket must meet the British Standard for helmet safety and be worn both in matches and in training when playing in certain positions.

While the current developments are positive and encouraging, related litigation could be taken in the future. Recently, during the rugby Six Nations Tournament, teammates Finn Russell and Darcy Graham collided with each other during Scotland's match against Ireland. Graham was taken off the pitch on a stretcher, but Russell was able to walk off the pitch to undergo a Head Injury Assessment (HIA). Although Russell passed his HIA, the Scottish coaches took the decision to keep him out of play for the rest of the match. Progressive Rugby, a non-profit player welfare lobby for rugby union, commented on X, formerly Twitter: "Excellent that the Scotland guys were this switched on, but it does show, yet again, that the HIA is not fit for purpose". Time will tell as to whether such assertions are features of any future litigation.

Looking forward

The progressive steps taken over the past decade or so should significantly reduce the risk of concussive injuries in competitive sport. However, there remains scope for litigation.

If the current legal actions succeed, they could open the floodgates to further claims. The scope of such claims may also broaden to include referees, clubs, or clinicians where concussion protocols are not properly followed. Players may even bring actions against fellow players and their clubs for dangerous tackles – such as in 2023, when Dani Czernuska-Watt successfully sued an opposing player after a tackle left her with catastrophic injuries.

If they have not already done so, insurers underwriting these risks should consider whether they wish to limit their exposures to such injuries through exclusions, conditions requiring adherence to safety standards and capped limits of liability.

Sky trademark ruling suggests strategy tips for brands

Thu, 16 Jan 2025 10:30:00 Z

This decision overturned an earlier Court of Appeal ruling holding that a lack of intention to use a trademark did not automatically mean it had been filed in bad faith.

Sky's broad trademark registrations contributed to the finding of bad faith. Although this could lead to a change in the way that brands seek protection for their marks, including ushering in a new era of lean specifications, brand owners should take comfort in the fact that they can still rely on a trademark's reputation to prevent others from using it, even in circumstances where the registration does not cover the specific goods or services in question.

Case Background

Primarily known as a media and telecommunications company, Sky had registered a number of trademarks for its brand name in 22 classes of goods and services.

Sky's trademark protection covered its core services, as well as a large variety of subcategories of goods not necessarily connected with its main services, including picnic baskets, earmuffs, dishwashers and diving suits. In some cases, Sky's registrations covered the entire class of goods for which it was registered.

The dispute between Sky and SkyKick, a cloud computer software provider, first arose in May 2016, after Sky issued trademark infringement proceedings against SkyKick over its use of the trademark "SkyKick." The claim primarily related to SkyKick's use of "SkyKick" in relation to computer software (Class 9), for which Sky had a broad registration encompassing the entire class.

SkyKick countered Sky's claim, seeking to invalidate many of Sky's trademarks on the basis that Sky had acted in bad faith by registering the Sky trademarks for an excessively wide range of goods and services, many of which were unrelated to Sky's core business. Under Section 3(6) of the Trade Marks Act of 1994, a trademark should not be registered if it was filed in bad faith, and can be revoked on such a ground.

At first instance, the High Court of Justice considered Sky's trademark registration for "computer software" and determined that Sky had no commercial justification for having filed such a broad mark. Although it was true that Sky did provide services in some subcategories of computer software for which it held the registration, the High Court held that this did not justify Sky's seeking to prevent other businesses from using the mark in relation to other forms of computer software that Sky did not have a bona fide intention of providing.

"Computer software" is just one trademark class that was the subject of the litigation, but the principle, according to the High Court, could apply across categories.

It was decided that a trademark should be partially invalidated for bad faith if filed for a broad range of goods and services without a bona fide intention to use them, and Sky's trademarks were reduced to only the classes in which the company could show genuine use. In any event, SkyKick was found to have been infringing the trademarks.

SkyKick subsequently appealed the decision to the Court of Appeal, which overturned the partial invalidation of Sky's trademarks. The Court of Appeal ruled that although the goods and services had been registered for a broader category than were intended for use, this should not necessarily lead to an inference of bad faith if the trademark holder had substantial current or future trade in part of that broader category.

In the case of the computer software services, this meant that Sky's use of its "Sky" mark in relation to certain niche subcategories of computer software could remove any inference that the application had been made in bad faith. Without a bad faith finding, there could be no invalidation.

This decision aligned U.K. law with European Union trademark law, which allows applicants to have broad registrations for their trademarks. SkyKick appealed this decision further to the Supreme Court, arguing that the Court of Appeal's decision would lead to a cluttering of the register.

The Supreme Court trial took place last year.

The Supreme Court's Analysis

The Supreme Court considered four main legal issues.

What is the test for determining "bad faith" in the Trade Marks Act of 1994?

The Supreme Court held that the Court of Appeal was wrong to reverse the High Court's finding that Sky's overly broad trademark registrations (in classes including "computer software" in Class 9 and "electronic mail services" in Class 38) amounted to bad faith. Therefore:

Applicants must have a "commercial justification" for filing a trademark in specific classes.
If an applicant cannot prove that it has a genuine intention to use the trademark in relation to specific classes, the court may infer that the filing was made in bad faith.
Although filing a trademark in "extremely broad" terms or in a high number of classes does not indicate that the filing was made in bad faith per se, it will support an inference.
Once an inference of bad faith is drawn, the trademark is vulnerable for whole or partial invalidation.

If bad faith is found, how should a court determine the trademark specification that the owner can retain?

The Supreme Court held that where an application has been made in bad faith, the broad specification should be narrowed, confirming that partial invalidity of a trademark is possible:

If bad faith is established for only some goods and services within the specification (i.e., if the applicant can show that it had a genuine intention to use the trademark for some goods and services, but not others), the registration should be declared invalid only for the goods and services for which it cannot show a genuine intention to use.
The specifications applied for in "good faith" can be retained.

Did SkyKick ultimately infringe Sky's trademarks?

The Supreme Court held that SkyKick had infringed Sky's trademark registration for "cloud backup" services, but not for "cloud migration" services (i.e., confirming the Court of Appeal's decision). Although Sky had a registration for "electronic mail services," this could not cover "cloud migration," as those services were a confined subcategory of services.

What is the impact of the U.K.'s withdrawal from the EU on cases involving EU trademarks?

The Supreme Court confirmed that the U.K. courts continue to act as EU trademark courts, for all proceedings that were pending before a U.K. court (designated as an EU trademark court) before the end of the Brexit transition period on Dec. 31, 2020. This meant the Supreme Court's decision has effect across all the EU trademarks Sky relied on, not just its U.K. mark.

Commentary

It is fair to say that the legal landscape on bad faith has been uncertain for some time following the referral of the Sky v. SkyKick claim to the Supreme Court. However, the judgment does not require brand owners to have an immediate radical rethinking regarding their trademark portfolios per se. Invalidation actions against trademark registrations are typically, albeit not exclusively, commenced as a defense mechanism to counter trademark infringement allegations.

Going forward, brand owners should strike a balance between a specification broad enough to meet business requirements but not so broad as to invite unnecessary counterattacks for bad faith.

Increased care should therefore be taken when drafting trademark specifications — for example, by using subcategories of goods and services as opposed to broad categories, or limiting broad specifications. Also, at the time of filing, it would certainly be prudent for brand owners to record in writing their rationale for the trademark filing in order to refute any potential future bad faith allegations.

In circumstances where trademark protection for specific goods and services is not sought at the point of filing, but a brand owner's business expands into such goods and services, all is not lost. A brand owner can still make additional trademark applications to cover those goods and services.

If a third party is using a trademark on an unrelated product for which the brand owner does not have use or a registration, Section 10(3) of the Trade Mark Act can be used.

This enables a trademark owner to bring infringement proceedings where a mark that is identical or similar to a prior registration is used by another party for goods and services that are dissimilar, and in circumstances where such a trademark has an established reputation and the use might damage the trademark holder's reputation or cause confusion.

This article was originally published on Law 360

Football regulator heralds new era for The Beautiful Game

Wed, 18 May 2022 11:44:00 +0100

The review was conducted by a panel chaired by former sports minister Tracey Crouch and heard evidence from fans, club leaders, interest groups, football authorities and financial experts, among others.

The review came about following a number of issues in men’s football in England. The report specifically highlighted the following as three of several key concerns: the collapse of Bury FC; the far-ranging impacts of Covid-19; and the attempt to set up a European Super League (ESL) in April 2021 which included six Premier League clubs.

The government confirmed in its response to the report that it has plans for significant reform. This will include an independent regulator focused on financial sustainability, and a strengthened approach to ownership of football clubs and their governance.

Significance

The government’s commitment to both the overarching review of English football itself and the creation of an independent regulator for an individual sport is a testament to the enormous level of public interest in the national game and the financial value it provides.

Football remains unique thanks to its social relevance, its reliance on emotional investment, and the way in which it has the power to unite people across social, political and geographical borders. However, most professional clubs in England are ultimately significant corporate entities: they consist of financial, tangible and intangible assets, and are professionally marketed and managed with a view to achieving a profit.

The review therefore took the logical approach of factoring in similarities between football stakeholders as businesses and other commercial sectors. The review took advice from agencies and individuals who specialise in the regulation of those other sectors, while at the same time being cognisant of the specific idiosyncrasies which make football and sport special (such as the need and desire for fan engagement, the often-complex net of stakeholders, the legal and regulatory complexities associated with club and league compositions, and the immense value of the market as a whole).

Existing issues

Football has operated a model of effective self-regulation for over 150 years. There have been several temporary visits by football stakeholders to the courts to resolve disputes, but the overwhelming majority of disputes are subject to private football regulatory regimes which are policed, governed and determined ‘in-house’ by the Football Association (FA), Premier League and English Football League (EFL). Much has changed in the past 150 years, and the desire and call for greater transparency within football – including with respect to the processes and policies of the regulators – has arguably never been greater.

The challenges facing the incumbent regulators of football (the FA, Premier League and EFL) include a widespread perception of too great a propensity for conflicts of interests to arise, and that there is an increased risk that inconsistent decisions may be applied in circumstances where so much is dealt with in private.

Recommendations

The most eye-catching of the review’s 10 strategic recommendations is for a new independent regulator for English football (IREF), to be established by an act of parliament. This recommendation underpins all others, many of which require implementation of the regulator before they can be implemented.

It is proposed that the IREF will operate a licensing system. In order for clubs to obtain and maintain their licence, they must comply with certain licensing conditions that focus on measures to ensure financial sustainability through financial regulation and new owners’ and directors’ tests, and improving decision-making at clubs through items such as a new corporate governance code for professional football clubs; improved diversity and player welfare; and stronger fan engagement. The licensing system would also allow the IREF to protect key items of club heritage via a ‘golden share’ requiring supporter consent to certain actions, such as the stadium location, club colours, badge and name, or joining a non-FIFA-, UEFA- or FA-sanctioned competition.

A significant focus of the IREF will be on changes to how clubs manage their finances, the availability of owner subsidies, cash buffers, divisional pay, and transfer levies. One of the proposals concerns capital and liquidity requirements used in the financial risk supervision model operated by the Financial Conduct Authority. The financial regulations recommended are to ensure clubs are sustainable and able to withstand shocks such as missed promotion, relegation or the loss or withdrawal of a wealthy owner. While the report noted the importance and prevalence of owner subsidies in English football, it wishes to avoid situations where clubs are completely reliant on owner subsidies to cover normal operating costs or where big-spending owners have destabilised leagues by impacting wage inflation.

The government confirmed that the IREF will be statutorily established, and the report recommends that the IREF will either be the arbitrator or nominate an arbitrator in disputes. How its decisions will be reviewed and the finer details are to be confirmed.

The panel did not go so far as recommending that IREF has power over organisation of the competition and commercial activity, adopting a ‘regulation where regulation is due’ approach.

Commentary

The independent, proactive, regulatory model proposed in the report borrows concepts from other regulated industries. Utilising a licensing regime with licensing conditions is used in various industries (including gambling); banks are subject to the jurisdiction of the Prudential Regulation Authority and FCA; and solicitors operate under the auspices of the Solicitors Regulation Authority. Codes of conduct, rules, investigations and disciplinary actions are all part and parcel of more mature regulated areas. And while even those are subject to regular reviews and feedback (and require proper funding and capacity), they are intended to (and largely do) assist in better serving and protecting the public at large.

While many will welcome the recommendations aimed at improving transparency and promoting diversity, equality and inclusion, and player welfare, there already appears to be reticence from some quarters in relation to the financial regulations and increased obligations around cashflow reporting, cash buffers and limitations over owner subsidies.

The resourcing and funding of the IREF has also not been fully fleshed out. This would need to be considered carefully to ensure that the IREF is able to function effectively and independently.

There are also questions about the timeframes associated with implementing the IREF. The government has committed to publishing a white paper in the summer, with further details on the implementation of reform.

There is also the elephant in the room – what about the existing web of regulatory bodies and competitions? Existing structures currently enable the FA, Premier League and EFL to interface with UEFA and FIFA, for example. Where and how will the IREF interface with these bodies?

Conclusion

While the government’s announcement marks a significant step change in how football may be regulated in England, it is an early step on what we expect to be a longer journey of reform. More information should be provided when the forthcoming white paper is released and there is likely to be significant lobbying on behalf of different stakeholders within football.

For those who want to see greater transparency within decision-making and dispute resolution in football, there are reasons to be cautiously optimistic. For the IREF to be truly independent, there will need to be a proper separation of powers between different functions such as investigations and enforcement, drafting and embedding new regulations, and the determination of disputes.

This article was first published in Law Society Gazette on 13 May 2022.

Sports Ticker (10 May 2021) - Para-sport basketball league, Premier League TV Rights and Olympic Virtual Series

Mon, 10 May 2021 14:24:00 +0100

Access the full Sports Ticker here.

Dream turned reality: Professional parasport basketball league

British Wheelchair Basketball has launched its first ever professional parasport basketball league, a game changing and exciting move for wheelchair basketball. The first season of the Women's Premier League, the first of its kind in the world, will take place between December 2021 and May 2022 with players being selected from four UK Universities (Cardiff Metropolitan University, Loughborough University, University of East London and the University of Worcester) as British Wheelchair Basketball's HighPerformance Partnerships. Lisa Pearce, British Wheelchair Basketball chief executive, hopes this league will assist in getting Team GB's women (currently second in the world) to number one, so we look forward to seeing how the league develops and the opportunities it will provide for aspiring talent across all levels. Read more

Premier League considers scrapping next TV rights auction

The Premier League has discussed potentially cancelling its next domestic media rights auction in favour of rolling over the reported current £4.7bn deal with broadcasters. From the Premier League's perspective, it suggests that the rollover will ensure stability for all parties amid the uncertainty caused by COVID19. It has therefore reportedly held talks with Sky, BT and Amazon about extending the current deals that were initially secured in 2018. It is expected that rival broadcasters may raise objections, and the move will require approval from a competition law perspective. It is also interesting to note that BT Sport has reportedly opened talks with potential investors as it considers a prospective sale of its sports broadcasting operation in order to focus more on its core telecoms/broadband business (see here). Since its inception, BT Sport has grown to be a major player in terms of sports broadcasting and has rights to a range of leading competitions from the Premier League, Champions League and Europa League, to boxing and Premiership Rugby. Read more

British & Irish Lions new charity partnerships

The British & Irish Lions Charitable Trust has revealed four new charity partnerships for the coming year – Matt Hampson Foundation, My Name’5 Doddie Foundation, The Atlas Foundation, and Wooden Spoon. The oneyear partnerships will enable the charities to use The British & Irish Lions Charitable Trust logo for all promotional activity during that period. In addition, the charities will also be able to use the Lions’ digital platforms for promotional purposes, and will have access to 2021 Lions Tour memorabilia for fundraising. According to Gavin Hastings, Chairman of Trustees for the Lions Charitable Trust, the Lions Trust's stated purposes are “to connect with, nurture and support all Lions players in need, alongside furthering the spirit, values and ethos of the Lions through rugby clubs and communities” across the home nations. The Trust focuses on providing financial support for the home unions’ funds for injured players and offering assistance to Lions who may have fallen on challenging times. Read more

Brand new Olympic Virtual Series

The International Olympic Committee (IOC) has announced the Olympic Virtual Series (OVS), the first ever Olympic licensed event for both physical and nonphysical virtual sports. To produce the series, the IOC will partner with five International Federations as well as game publishers such as the World Baseball Softball Confederation and World Sailing. The OVS is scheduled to take place between 13 May and 23 June 2021 ahead of the Tokyo Olympics and will provide a stage to connect the physical and virtual gaming communities together in relation to sports such as virtual cycling and baseball. The IOC has said that the OVS “creates a stage to connect the physical sporting world with the virtual and simulation sports gaming community”, an exciting and major step for the Olympics. It will be interesting to see how the esports series integrates with the Tokyo Olympics and how engagement among new gaming and esports audiences grows. Read more

Asahi Breweries partners with Rugby World Cup 2023

World Rugby has announced a new commercial partnership with Asahi Group that will see the Japanese beer, spirits, soft drinks and food company join as a global sponsor for the upcoming Rugby World Cup 2023 in France. Asahi's flagship ‘Super Dry’ Lager will also become the official beer of the tournament, replacing Heineken which was the official beer of the Rugby World Cup in Japan in 2019. Asahi will have to navigate the loi Évin rules in France, which strictly regulate advertising and marketing of alcohol products, and largely bans alcohol advertising in France. The loi Évin restrictions have given rise to clever marketing changes for tournaments which host matches in France, like the Heineken Cup (referred to as the ‘H Cup’ when matches take place and/or are broadcast in France), the Guinness Six Nations (which sees the Guinness logo replaced with the word “Greatness” on the pitch in France), or Euro 2018 (when Carlsberg instead had perimeter advertising simply saying: “Probably...” in the recognisable Carlsberg font and colours). We await to see the solution preferred by Asahi. World Rugby chairman Bill Beaumont said: “We are delighted to be welcoming Asahi Group to the family of worldwide partners for Rugby World Cup 2023. Their appointment not only reflects the prestige and truly international appeal of our event, but of the power of a growing and global sport to reach and engage new audiences”. Asahi joins the French banking group Société Générale and Mastercard in the toptier of worldwide partners announced to date for the eagerly awaited tournament in 2023. Read more

Extra time...
...and finally, the hot topic of the European Super League (ESL) (see Ticker 36)
continues. In the last fortnight we have seen the postponement of Man United's match versus Liverpool (following protests against Man United's owners, which included protests against the club's involvement in the ESL issues). Questions around whether and when that match can be re¬arranged (and the consequences if it cannot) remain up in the air at the time of writing. Spotify founder, Daniel Ek has stated his interest in acquiring Arsenal FC supported by various exArsenal players. Various executives from the ‘big 6’ teams have apparently been asked to stand down from Premier League committees; the FA has commenced an inquiry and announced that it had written to the ‘big 6’ clubs to request various information and evidence; and the Premier League is reportedly to bring in a new owner's charter. Lots to be keeping up with.

Sports Ticker (22 April 2021) - Super League, full stadiums and Coin for Respect

Fri, 23 Apr 2021 14:18:00 +0100

Access the full Sports Ticker here.

In a fortnight during which Chinese live-streaming platform Bilibili entered into a multi-year exclusive broadcasting rights deal with Overwatch League owner Activision Blizzard (see here), we consider the controversial European Super League, Under Armour's new kit partnership and plans for stadiums to get back to full capacity. We also feature DAZN's future IPO and the Coin for Respect Campaign.

As always, if there are any areas you’d like more information on (or if you have any questions or feedback), please let us know or get in touch with your usual RPC contact.

Everybody’s talking about the Super League (and the Special One)

What a difference two days makes in the world of football. Over the weekend, announcements were made that Real Madrid, Barcelona, AC Milan, Inter Milan, Juventus, Man United, Liverpool, Man City, Arsenal, Tottenham and Chelsea had founded a new ‘Super League’ and intended to walk away from UEFA competitions. Key executives at these clubs who had places at the table of the European Clubs Association resigned, and the whole sporting world focussed on what would happen next. Read more.
Getting kitted out with Itoje and Under Armour's new partnership

England and Saracen's star Itoje has signed an endorsement deal with Under Armour, under which it is understood that Under Armour will subsequently be donating £1 million in sports apparel to Kit Us Out - a UK charity that works with grassroots sports initiatives by providing kit and equipment. The donation forms part of Under Armour’s global community impact programme, which seeks to recognise and alleviate certain barriers for young people engaging in sport. To add to the star-studded nature of this deal, the partnership has been developed by Jay-Z's sports management company, Roc Nation Sports, who signed Itoje last year. For Itoje himself, the partnership follows his previous work to reduce educational inequality in the UK, where he campaigned to highlight the “digital divide” among young people from different backgrounds earlier this year. Read more.
Spectators' delight: full stadiums on the horizon?

In a letter addressed to UK political party leaders this month, sports organisations such as the English Premier League, Rugby Football Union and the England and Wales Cricket Board have backed measures to support the return of fans without social distancing requirements. Those measures include the use of COVID-19 certificates and technology to authenticate tests (good timing - given the recent debates in Number 10 about the possibility of “Covid passports” for stadiums, the right measures certainly seem to be a hot topic for politicians). The government has already sought to take steps to mitigate losses suffered by clubs which rely heavily on ticket sales, for example, by agreeing to provide an additional £40 million for horse racing, rugby league, speedway and drag racing and £10 million for non-league football clubs in steps 1-6 of the National League. As clubs play an important role in many communities, it is hoped that the additional funding and fans returning will allow the clubs to bounce back and continue on strong footing. The Premier League is already planning for football stadiums to operate at a 25% capacity (or 10,000 people, whichever is lower) from 17 May. Read more.
Is DAZN seeking a knockout IPO in the week it is reported to have landed a deal with Matchroom Boxing?

British sports media company DAZN Group, often dubbed the “Netflix of Sports”, is reportedly planning for an IPO in the near future to drive further growth. This follows recent big wins for the company in which it acquired the rights to screen all Serie A matches in Italy, and as reported this week, the rights to stream all of Matchroom Boxing’s fights in the UK and Ireland after the existing deal with Sky expires this Summer. It is reported that future efforts could include a bid for the rights to the English Premier League, presumably supported by any monies made from a potential float. DAZN's current service enables viewers to subscribe for a flat rate to watch as much live sports as they want, and the push for further growth by DAZN will likely ensure that many of its rivals pay close attention to their ongoing rights acquisitions. Read more.
Coin for Respect Campaign: Hatch, Nationwide and the FA

Leeds based PR agency Hatch has been appointed by Nationwide and the FA to deliver the “Coin for Respect” campaign, an initiative aimed at promoting respect in grassroots football. The campaign will give children across the country the chance to design a new official coin that “will start every game with respect”. The winning design will be manufactured and distributed to over 20,000 grassroots referees for use in the pre-match coin toss. Hatch, which has previously worked with the EFL, Rugby League and World Cup 2021 will lead the PR and creative content delivery throughout the campaign later this year. “Mutual respect is at the heart of what we believe in, and we are excited to launch this initiative to ensure that a moment of respect will start every grassroots game from the beginning of the 2021 season”, said Paul Hibbs, director of advertising at Nationwide. We very much look forward to this being rolled out, particularly following grassroots football being given the 'greenlight' last month to restart. Read more.

Extra time...
… and finally, the countdown for the Tokyo Olympics begins. The opening ceremony is scheduled to take place in less than 100 days, on 23 July. This exciting milestone comes after the 2020 Olympics were postponed last year as a result of the pandemic. Although the Olympics will look slightly differently this year, with the IOC releasing guidance explaining the rules which must be followed to ensure everything runs safely and smoothly, the venues and stadiums are set up and ready to go. Team GB's preparations are also well underway. Despite having to make some changes to their plans to ensure the safety of the 370-athlete strong team, Chef de Mission Mark England, said that "with just 100 days until the Tokyo 2020 Olympic Games our preparations are progressing really well". Despite local reservations, we look forward to seeing how the Olympics and Paralympics (which is set to commence on 24 August 2021) pan out. Read more here.

Sports Ticker (12 Mar 2021) - Rugby World Cup, Fenway Sports Group and Dettol

Fri, 12 Mar 2021 15:30:00 Z

Access the full Sports Ticker here.

In a fortnight where former Team Sky and British Cycling Doctor, Richard Freeman, has been found guilty by a medical tribunal of ordering a banned substance to help an athlete improve their performance (see here), we consider Brisbane as preferred partner to host the 2032 Olympic Games, rescheduling of the 2021 Rugby World Cup and Sky Sports’ new pop-up Rugby League channel. We also take a look at the imminent deal concerning Fenway Sports Group and a new partnership between Dettol and the FA.

1. 2021 World Cup forward pass to 2022

World Rugby has confirmed this year’s Women’s Rugby World Cup is officially postponed to 2022. The competition was scheduled to be held in New Zealand from 18 September 2021 until 16 October 2021; however, due to the ongoing COVID-19 pandemic, the New Zealand border is currently closed to almost all arrivals. Commenting on the decision, the governing body said: “Given the number of athletes and personnel arriving from numerous locations, recent COVID-19 developments mean that it is simply not possible to guarantee optimal conditions for all teams to prepare for their pinnacle event, with continued uncertainties regarding training and match preparation.” Despite the general decline in COVID-19 infection rates worldwide, and the emergence of vaccines, it remains to be seen whether there will be a consistent trend towards or against further postponements..

2. RedBird Capital nearing deal for stake in Fenway Sports Group

RedBird Capital is set to make further waves following its acquisition of Toulouse FC and the XFL, as sources report it is looking to pay around $750 million to acquire a 10% stake in Fenway Sports Group (the owner of the Boston Red Sox and Liverpool FC). The acquisition has been a long term goal for RedBird founder Gerry Cardinale and is likely to close within the next five weeks. With a vast and successful portfolio, in addition to the Red Sox and Liverpool FC, including Roush Fenway Racing and the New England Sports Network, the deal will value Fenway at over $7 billion. Redbird is also a stakeholder of the Yankees Entertainment and Sports Network, the regional broadcaster of the Red Sox rival New York Yankees, while the RedBird founder himself is a stakeholder in the OneTeam Collective.

3. Sky Sports to launch pop-up Rugby League channel

Sky Sports is to launch a new pop-up Rugby League channel ahead of the 2021 Betfred Super League season, with Sky Sports Arena to show non-stop action for five days leading up to the opening matches on Friday 26 March. Rugby League fans should be delighted as they will be treated to 40 classic Rugby League matches as well as archive content including documentaries such as Rob Burrow: The Magnificent 7, Super League Super Men, and Warriors Down Under from Monday 22 March. There will also be two live National Rugby League matches to whet the appetite of Rugby League fans ahead of the action of the opening Super League fixtures at the end of March. Sky Sports’ social media channels will also be adding to the hype around the new season, with the launch of a new #RugbyLeagueTakeover hashtag. It is expected to be a welcome boost for the sport which has been acutely hit by the impact of COVID-19.

4. Dettol and the FA clean up

Dettol has been announced as the official hygiene partner of the England men’s and women’s senior football teams, Wembley Stadium, the wider grassroots game and St George’s Park. In the midst of a global pandemic, the partnership hopes to help reinforce important hygiene habits across every level of the game. Over 17,000 grassroots clubs and 1.4 million players will be given access to educational materials and a wide range of Dettol’s hygiene products, such as hand sanitizer and antibacterial wipes. Kathryn Swarbrick, The FA’s Commercial and Marketing Director, said: “It is more important than ever before to ensure that football has all the necessary measures in place to help protect all participants and supporters. This new partnership will give us added reassurance as we look ahead to the complete return of our much-loved sport.” Dettol’s football campaign will kick off ahead of the Three Lions’ first 2021 international fixture against San Marino on 25 March and the grassroots campaign will begin when clubs in England return to action.

5. Brisbane chosen as 'preferred partner' to host 2032 Olympic Games

Last month, the International Olympic Committee (IOC) announced Brisbane is the preferred bidder to host the 2032 Olympic Games. The IOC’s announcement sees Queensland’s capital take considerable steps towards hosting Australia’s third Olympics (Melbourne in 1956 and Sydney in 2000). The IOC statement said that it was “considering seizing the momentum offered by the excellent project of Brisbane 2032 and the Australian Olympic Committee, in this way, bringing stability to the Olympic Games, the athletes, the IOC and the whole Olympic Movement”. The move from the IOC will offer some certainty to future Games after the setbacks to Tokyo 2020 caused by COVID-19. Closer to home, Birmingham 2022 has unveiled the largest ever Commonwealth Games schedule, with over 286 sessions for fans to look forward to. The event will be the biggest multi-sport competition to be staged in the UK for a decade, and promises to be a magnificent edition of the Games - read more here.

Extra time...
…and finally, Tiger Woods has admitted he was ‘touched’ to the see the huge display of support from his fellow players last week at the final round of WGC-Workday Championship in Florida. A large number of Woods’ colleagues opted to don his famous Sunday red shirt with black trousers in order to show solidarity with the 15-time major champion, who is recovering from leg injuries sustained in a car accident in late February. Woods Tweeted that “It is hard to explain how touching today was when I turned on the TV and saw all the red shirts,” and “To every golfer and every fan, you are truly helping me get through this tough time.” Woods now faces what appears to be a prolonged period on the side-lines but was reported to be “in good spirits” after being moved to a new Los Angeles hospital for treatment last week. (Read more here).

Sports Ticker (25 Feb 2021) - England Cricket partnership, New Balance and Fantasy Premier League

Thu, 25 Feb 2021 16:14:00 Z

Access the full Sports Ticker here.

In a fortnight which saw Djokovic secure a record ninth Australian Open title, we consider Microsoft’s partnership with the ECB, potential boxing regulations and a landmark win for New Balance in the Chinese courts. We also take a look at Villa’s run in with Fantasy Premier League transfers, and Amazon’s ecommerce portal for the Portuguese football team.

1. Microsoft partner with the ECB in innovation drive

The England and Wales Cricket Board (ECB) and Microsoft have announced a new partnership to drive transformational change across the cricketing community through the use of technology. The collaboration focuses on three key areas: Cricket Communities, High Performance and Cultural Transformation and builds upon the ECB’s five-year strategy, which aims to grow the game, connect communities and improve lives through the sport. Through tapping into Microsoft’s technology capabilities, the partnership will allow the ECB to explore how artificial intelligence, real-time data and analytics can inform the performance of England’s national teams. In a broader effort to discover the next Jimmy Anderson or Joe Root from grass-roots cricket, there will be a specific focus on ball-tracking technology. Additionally, digital skills training will be provided to grassroots cricket communities as part of Microsoft’s ‘Get On’ campaign - designed to help 1.5 million people build careers in the technology industry.

2. UK Government urged to address Kinahan’s involvement in boxing

Stephen Farry MP, the deputy leader of the Alliance Party, has urged the UK Government to be “more proactive” in dealing with the involvement of alleged crime boss Daniel Kinahan in boxing. Kinahan, who has previously advised some of the sport’s most prominent names, including Tyson Fury and Billy Joe Saunders, has no criminal convictions but has been linked with drugs cartels. Last week, Farry said that “stronger pressure was required” from the Government, including “a willingness to legislate” on the regulation of advisers in boxing. Farry also accused the Department of Culture Media and Sport of a “passive response” when asked a series of questions. It will certainly be interesting to keep an eye on whether Kinahan’s involvement will be limited going forwards, particularly given that the British Boxing Board of Control has confirmed that it cannot prevent Kinahan from advising boxers because it does not regulate such roles and Kinahan is not licensed with them.

3. New Balance wins copycat trademark case in China

New Balance has won a landmark trademark case against Chinese sportswear company, New Barlun, with the Shanghai Huangpu District Court ordering New Barlun to pay US$3.85 million in damages. New Balance’s successful claim centres on its repeated and consistent use of its “N” trademark. New Barlun manufactured and distributed shoes incorporating the “N” symbol and had previously successfully obtained a trademark registration for a mark “N” before New Balance; however, the Court ruled that New Barlun’s use of the “N” symbol infringed New Balance’s trademark as the logo was incredibly similar in both a “visual and conceptual capacity”. As RPC partner Ben Mark told Vogue Business earlier in the month (see here), “China as a jurisdiction for brand owners has always been troubled because it has always been difficult to police copycat manufacturers and to actually get anywhere in the courts.” The judgment has not taken effect at the time of writing, and we wait to see whether an appeal is made - watch this space!

4. Will FPL become a fantasy for ‘Insiders’ moving forwards?

Integrity within sport has encountered significant challenges with the leaking of team news and injuries over the years. However, one recent story from the last fortnight which introduces an interesting twist concerns the Fantasy Premier League (FPL), and the Premier League players who have their own teams. Patrick Bamford made news by commenting light-heartedly on how he captained himself in his FPL team, to some amusement as he scored in Leeds’ win v Crystal Palace this month. But leaked news that Jack Grealish was injured for Villa’s game v Leicester was not so amusing for manager Dean Smith. A Twitter account called FPL Insider, who reportedly uses a scraping-style bot to monitor transfers in/out of Premier League players’ and coaches’ FPL teams, posted that Grealish (who barely misses a game) was conspicuously transferred out of colleagues’ teams in the days before the match. There are already ongoing debates around whether Fantasy League sports amount to gambling, and it will now have shot to the top of many agendas (such as clubs, the EPL, EFL and The FA) to consider whether it presents an integrity threat when players participate or select (or deselect) players from their own team.

5. FPF launches official Portugal Team store on Amazon

The Portuguese Football Federation (FPF) has teamed up with Amazon to launch a new ecommerce portal for the national team. The ‘Official Team Store’ will make national-team branded products available to fans in every global market reached by Amazon. The site has already launched two ranges of products for fans of the Portuguese national team: a Portugal collection of branded casualwear and a range of branded ‘hobby items’ including key rings, footballs and scarves. Nuno Moura, chief marketing officer of the FPF, commented that “the national team has a wide fan base spread across the globe, this new official store will allow us to provide premium access to the best products and articles to all our fans and send them quickly to a number of new geographies.” The move by the FPF is part of a growing trend in the industry, with Tottenham Hotspur, Bayern Munich and Inter Milan already having established official Amazon stores.

Extra time...
…and finally, data science company Sportable have collaborated with leading rugby ball manufacturer Gilbert to produce a ‘smart’ rugby ball which uses 3D tracking technology to produce deep analytical insights. Whilst the initial reactions are focussing on how it might cut out forward passes (and it definitely might!), coaches will be excited to see data around hang time and distance for kicks, together with the way in which the data can be interfaced with other intelligence to help coaches map relative attack / defence positioning on the pitch. The use of data technology in sporting equipment is significantly on the rise, with us seeing plans for similar collaborations between data companies and manufacturers, including in combat sports (measuring hand speed, punch power etc.) for instance. It raises interesting questions as to who owns what data and how it can be protected. The ball was trialled by Saracens and Coventry in their pre-season match last week. (See more here).

Sports Ticker (12 February 2021) - Super Bowl LV, NBA investment and Ligue 1 broadcasting

Fri, 12 Feb 2021 15:54:20 Z

Access the full Sports Ticker here.

In a fortnight which has seen TikTok become an official UEFA EURO 2020 sponsor (see here), we consider advertising at last Sunday’s Super Bowl and EA Sports’ exclusive rights deal with UEFA. We also take a look at the latest developments in the Ligue 1 broadcast crisis and McIlroy’s take on proposed rule changes to limit the length of golf clubs.

1. Super Bowl LV: The GOAT v The Kid
Sunday’s much hyped Super Bowl LV saw Tom Brady lead the Tampa Bay Buccaneers to a historic victory against the Kansas City Chiefs.

2. EA Sports: Champions League - it’s (still) in the game
EA Sports, publisher of the highest-selling sports video game franchise FIFA, has signed a multi-year extension for the exclusive rights to the UEFA Champions League, Europa League and Super Cup for forthcoming FIFA games.

3. NBA owners agreed on framework allowing investment funds
The NBA Board of Governors have agreed a framework whereby institutional investors, such as private equity funds, will be permitted to own part of NBA teams.

4. Canal Plus strike discount deal for remaining Ligue 1 matches
Canal Plus has reached a final hour agreement with the Ligue de Football Professionnel (LFP) to broadcast the season’s remaining Ligue 1 fixtures following the “spectacular collapse” of the contract with former broadcast partner, Mediapro.

5. Rory McIlroy slams USGA proposed rule changes
Rory McIlroy has strongly hit out against proposed rule changes to limit the length of golf clubs. The four-time major winner was highly critical of the Distance Insight Project report last week, which was issued by the R&A and United States Golf Association (USGA), describing it as “a waste of time and money”.

Extra time...
…and finally, the last fortnight has also seen the release of Trailblazers, an excellent new series showcasing sport’s greatest stories and heroes who inspired meaningful change. Episode 1 features the Serena Williams story - and provides an amazing insight even to those who think they’ve heard her story before. There are 9 more episodes to come, covering athletes such as Jesse Owens, Cathy Freeman and Colin Kaepernick. The series is shown on Eurosport and was created in collaboration with Refresh, a boutique sports consultancy and production company (see here).

The risk of cyber threats to sports organisations (and key steps to reduce exposure)

Tue, 01 Dec 2020 17:29:51 Z

The article - written by Jon Bartley, Stuart Harris and Joe Akwaboa - aims to help sports organisations to understand the current cyber breach landscape, become more familiar with common cyber threats and learn practical mitigation steps to reduce risk and potential vulnerability.

In terms of immediate headline thoughts following the United incident:

Despite Manchester United identifying the source of the attack and shutting down affected systems to contain the damage (then reporting the breach to the ICO in line with its regulatory obligations) it appears that some of the club's systems were still affected a week after the issue, causing operational disruption for staff.
Cyber-attacks against sports organisations are on the rise, with 70% of organisations surveyed in the recent NCSC report reportedly experiencing at least one attack a year.
Few sports organisations will have such extensive protocols and procedures as United to deal with these kinds of incidents. However, the club were reportedly not fully operational a week after the attack. This should be a real wake-up call for sports organisations who are less prepared for cyber risks.
There are effective (and affordable) ways to audit weaknesses and reduce exposure to many common types of cyber-attacks. Put simply, doing nothing is not an option. This is key to help with reducing vulnerability to attacks, which can be costly in terms of operational disruption, regulatory action and data subject complaints (not to mention associated reputational damage).

Please let us know if you would like to discuss any aspects of the above. See here for more information on RPC's Sports group, or here for our cyber breach offering (or reach out to your usual RPC contact).

The article referenced above was written for and first published by LawInSport. The full version is available to view here [paywall for if reading more than a certain number of articles per month].

Sheffield United, or divided? Implying duties of good faith

Mon, 04 Nov 2019 15:13:00 Z

Background

The relationship between Kevin McCabe of Sheffield United Limited ("SUL") and Prince Abdullah bin Musa'ad of UTB LLC ("UTB") began in 2013 when the parties entered into an Investment and Shareholders' Agreement ("ISA"). The ISA stated that UTB would provide £10 million over a period of around 2 years in return for 50% of the shares in the Blades, who wholly owned Sheffield United Football Club ("SUFC").

Numerous disagreements subsequently arose throughout 2013 to 2018, leading to the two parties deliberating how to end their joint ownership of SUFC. SUL acted first and offered to buy UTB's shares for £5 million by serving a Call Option Notice under the ISA. However; SUL (purportedly) did not realise that the call option also permitted UTB to serve a counter notice on SUL, enabling UTB to purchase SUL's shares for the same price that SUL had previously offered.

UTB subsequently sought to enforce the purchase of SUL's shares and SUL sought to have the contract declared void or set aside and that UTB sell its shares to SUL at the current value (which has hugely increased since SUFC's promotion to the Premier League in the 2019 season).

Decision

Whilst the Judgment considered a number of legal issues, such as the validity of the contract, specific performance and section 994 of the Companies Act, this article will focus on the Court's interpretation of whether good faith could be implied into the ISA.

What is the duty of good faith?

Case law¹ has held that an express term requiring the parties to act with the utmost good faith towards one another imposed an obligation "… to observe reasonable commercial standards of fair dealing in accordance with their actions which related to the Agreement and also requiring faithfulness to the agreed common purpose and consistency with the justified expectations of the [other party]" and that "… the obligation of utmost good faith in the [contract] was to adhere to the spirit of the contract […] and to observe reasonable commercial standards of fair dealing, and to be faithful to the agreed common purpose, and to act consistently with the justified expectations of the parties."

Can good faith be implied into a contract?

The most significant development in relation to whether good faith can be implied into a contract was in Yam Seng Pte Ltd v International Trade Corporation Ltd² where Leggatt J held that that a duty of good faith could be implied into a 'relational' commercial contract.

Relational contracts normally involve a long term relationship with a substantial amount of communication, co-operation and predictable performance. Bates v Post Office (No. 3)³ sets out a number of criteria that may determine if a contract is relational, such as (i) an intention to perform the parties’ respective roles with integrity and fidelity to the bargain, (ii) a commitment to collaboration in the contract’s performance and (iii) a high degree of communication, cooperation and predictable performance based on mutual trust and confidence, and expectations of loyalty.

However; whilst the Judge in this case acknowledged the previous decisions in Yam Seng and Bates, rather than question whether the contract was relational, he considered the test should be whether a 'reasonable reader of the contract would consider that an obligation of good faith was obviously meant or whether the obligation is necessary to the proper working of the contract'.

As a result: (i) given that there were areas in the ISA where good faith was expressly required (therefore indicating that the parties had considered where and where not to act with good faith); and (ii) the contrasting interests of the parties were both reflected in the ISA and at different points in the relationship, the Court found that the terms of the ISA were not subject to an implied term that each of the shareholders were to deal with the other in good faith.

Therefore, the Court held that SUL must sell its shares to UTB, making UTB the majority owner of SUFC.

Comment / Practical Tips

As the court will not always look to see whether there is a relational contract as a basis to imply a duty of good faith between parties, contracting parties should decide at the outset whether or not it is in its best interests for the contract to be subject to a duty of good faith. Parties should expressly set out this duty in the contract (bearing in mind that if they set good faith obligations for specific terms of the contract, the courts may interpret this as meaning that good faith will not apply to the other terms of the contract).
Even when parties start a relationship with the best intentions, small disagreements and misunderstandings about terms and responsibilities of each parties can lead to a significant dispute. In order for parties to avoid the type of scenario that we saw between SUL and UTB , it is important to set out clear responsibilities for each party so that the contracting parties are aware of their respective duties such as, in this case the funding of SUFC after UTB's injection.
Finally, the parties should have a clear long-term goal and purpose. Whilst the clear purpose of SUFC was to be promoted, the long term strategy between UTB and SUL was uncertain. Whilst provision was initially made for UTB to become majority shareholder and purchase the property assets of SUFC (as did happen), as financial trouble set in, the interests of the parties changed which ultimately resulted in Sheffield being not so United.

The RPC Sports group regularly advises clients on sports related disputes – including shareholder disputes and sports agreements which include (or sometimes deliberately exclude) duties of good faith. For more information, please contact Jeremy Drew (Partner), Samuel Coppard (Associate) or your usual RPC contact.

¹ Berkeley Community Villages Ltd v Pullen [2007] EWHC 1330 (Ch)

² [2013] EWHC 111

³ [2019] EWHC 606 (QB)

Sporting compromise – tips for settling sports disputes

Thu, 24 Oct 2019 09:47:00 +0100

Introduction

Settlement agreements come in all shapes and sizes.When supporting clubs on a wide range of settlement issues, those responsible internally for settling disputes are often faced with documents which aim to compromise all disputes between the parties.

For those short on time, it can be challenging to navigate unfamiliar drafting whilst ensuring that the agreement: (i) does what it needs to and doesn't leave any gaps – unless by design; but (ii) does so with minimal fuss and redline.

We have therefore produced a tip sheet of 5 key areas to consider when settling sports disputes. It's not an exhaustive list, but helps to focus on what are often the key areas to think about.

Some practical tips

More than just the club: it's common to see drafts of settlement agreements that seek to resolve claims between: (1) a club and its group companies; and (2) the counter-party. Don't forget to check whether you need to settle claims further afield against directors, owners and/or consultants to the club.

We have seen a significant rise in individual directors and officers (including club and company secretaries) becoming embroiled in disputes in a personal capacity. Don't forget that owners and increasingly consultants may also be at risk depending on their day-to-day involvement. Never inadvertently leave a key person behind.
Clean slate: do you want to encompass all potential claims under your settlement agreement? If yes, ensure that the settlement wording makes it clear that it is on a full and final settlement, satisfaction and release basis.

A settlement agreement is often the perfect opportunity to resolve all disputes between the parties (both ways) – having a mutual settlement and release assists in creating a clean slate and encouraging co-operation and collaboration moving forward. It's also good practice to include a no admission of liability clause.

If proceedings have been issued in Court already, make sure you use a consent order to discontinue the proceedings commonly with no order as to costs. Defendants – avoid a Tomlin Order where you can.
Getting everything done: proceedings might have been issued already, or there may be arbitral or disciplinary complaints which have been submitted by one or all parties. Either way, it's a good idea to include a further assurances clause. It's more than just boilerplate wording and creates a specific obligation on the parties to promptly execute and deliver the documents / do the things / procure that things are done which are required to give full effect to the settlement agreement. This can include the withdrawal of complaints made (for example) to the Premier League, EFL or the FA in a football context – a further assurances clause would often sit alongside express obligations to take such steps.
Have confidence: including specific confidentiality obligations in the settlement agreement is a given. However, consider carefully the relevant carve outs and what might be required from a regulatory perspective. If you're an agency settling a dispute with another agency for an intermediary related dispute, you must now disclose a copy of the settlement agreement to the FA – be clear that doing so does not amount to a collateral waiver of confidence. You may also need to disclose confidential information about any numbers involved to accountants and/or auditors or HMRC. Ensure that there are back-to-back obligations on third parties to keep information confidential subject to the usual legal and regulatory carve-outs.

Often key to the issue of confidentiality is for the parties to agree up front what statements are / aren't permitted. This typically comes in the form of agreed statements in an annex, with the settlement agreement expressly calling out any issues that the parties agree not to refer to. This mitigates the risk of disputes arising from public statements made in the heat of the moment.
Settlers' remorse: often the fact that parties have compromised their disputes doesn't mean that they're suddenly the best of friends. Parties may therefore think about including anti-disparagement wording to create a legal obligation on the parties not to make statements that would damage the reputation of the other.

Conclusion

These tips are best used as a crib sheet to sense-check the document in front of you (rather than acting as the starting point for an agreement).

The RPC Sports group has enormous experience in sports disputes – the firm is regularly ranked by The Lawyer amongst the top firms in terms of days at Court (including at number 1 for days overall in Q1, and for TMT related disputes in Q2 in stats collected by The Lawyer). A significant number of those days related to high profile Commercial Court claims in the sports industry.

This experience sees us settle many disputes at all stages of litigation and arbitration. For more information please contact Josh Charalambous, Jeremy Drew or your usual RPC contact.

Look what you made me do – avoid inducing a breach of a sporting contract

Thu, 12 Sep 2019 11:00:55 +0100

Thu, 12 Sep 2019 11:00:55 +0100SportsJoshua Charalambous, Samuel CoppardIn the highly competitive world of professional sport, it is common for sports organisations to tempt players and managers to join them. Typically the draw of new and more lucrative contracts or a higher standard of competition will be particularly persuasive to those already under contract. However, these actions do carry the risk of (at the least) serious allegations of inducing a breach of contract, particularly in circumstances where loss is said to be suffered.

Such allegations are often made against individual directors responsible for the negotiations – this is a typical tactic for Claimant clubs/sports organisations that are aggrieved by what they perceive to be unfair approaches for their players/managers.

It's also important to recognise that such allegations would usually be run alongside complaints made to the relevant sports regulator (such as the Premier League or the EFL in English football).

Before we run through our practical tips, we'll do a quick recap of the building blocks for these kinds of claims.

What is inducing breach of contract?

Inducing a breach of contract occurs when a third party ('A') knowingly or recklessly and intentionally induces one of the parties to a contract ('B') to breach a contract that 'B' has with the other party ('C'). In order for 'C' to be able to bring a claim for damages against 'A', 'C' must also be able to prove that:

'A' knew (or recklessly "turned a blind eye" as to whether) 'B' would be in breach of the contract with 'C' as a result of the inducement;
'A' intended to induce 'B' to breach the contract - even if the breach was only intended as a step towards 'A' achieving its ultimate aim; and
as a result of the inducement by 'A', 'B' has actually breached the contract between 'B' and 'C', in such a way as to cause 'C' loss. This is whether or not 'A' intended to cause that loss.

It's easy to see how clubs could find themselves and their new signings in hot water when they induce managers/players under contract with another club to move to their club instead (often following an unauthorised approach).

The classic scenario might occur where Club 'A' induces player/manager 'B' to breach player/manager 'B's' existing employment contract with Club 'C', with the aim that player/manager 'B' moves to Club 'A'. This could, for example, arise through Club 'A' inducing a breach of confidence where player/manager 'B' discloses confidential terms of the existing agreement, such as the terms of any release or buy-out clause, or the amount of compensation due to Club 'C' upon early termination.

An interesting recent example (albeit in Spain) of a club allegedly inducing a breach of contract is in relation to the Antoine Griezmann transfer. Atlético Madrid recently (publically) accused FC Barcelona of inducing Griezmann to breach his employment contract. Atlético communicated the "strongest disapproval of the behaviour of both, especially FC Barcelona, for prompting the player to break his contractual relationship with Atlético de Madrid". Although a Spanish based example, the risk applicable to English based clubs is clear.

Intermediaries and their involvement in approaches by clubs (like Club 'A' in the example above) must also take care: often the intermediaries will know the detailed terms of the relevant contract. At the least, they will be aware of the likelihood that the contract will contain certain relevant terms – such as release clauses. Intermediaries must tread a careful line to comply with their confidentiality obligations, and avoid inducing any breach themselves.

Practical tips

Whether you're concerned that a counter-party was induced to breach the terms of its contract with you, or that allegations of inducing breach may be levelled against you, here are some practical tips:

That knowing look – this is key. Whether 'A' knows that 'B' will be in breach of contract is a subjective test (did 'A' actually know, not should 'A' have known). However, if 'A' doesn't see the contract, but deliberately or recklessly disregards the facts about it (eg 'A' knows the contract probably does contain terms preventing 'B' from taking the steps 'A' intends 'B' to take, and 'A' consciously decides not to check), then 'A' could still be liable. From each perspective:
- If you are in the position of 'C' (the person who has suffered loss because of the breach) consider if 'A' must have known about the existence (or likely existence) of any contract terms it has induced 'B' to breach. Confidentiality obligations in the contract might be particularly helpful: consider whether 'A' must have obtained and used confidential information supplied in breach of contract by 'B', in response to the inducement of being approached by 'A'. As well as demonstrating that 'A' had knowledge of the relevant terms of the agreement, this could also help to establish a separate claim for misuse of confidential information.
- If you are in the position of 'A' (the inducer) – do not use confidential information about an agreement which is disclosed to you in breach of contract (even if it was disclosed to you when you didn't expressly ask for it). One clear risk is where 'B' tells you the details of their buy-out/release clause, or volunteers information in response to your approach.
Playing by the rules – parties must focus on ensuring compliance with relevant governing body rules and avoiding claims. Remember, often the relevant sporting regulatory rules will require clubs to get permission from other clubs before approaching managers/players (provided the managers/players are subject to the same rules – see further re Premier League rules below). Just because you comply with that obligation does not mean you are in the clear on inducing breach of contract (and vice versa, just because you didn't induce a breach of contract, doesn't mean you've complied with the relevant rules). Take the time to focus on both – and get advice if you need it.
Ask permission not forgiveness – minimise risk of allegations of rule breaking by ensuring that approaches to players/managers are made through the respective clubs. This is often required by the relevant rules anyway (eg under the Premier League rules (J.3) clubs must not directly/indirectly approach players, managers and senior first team staff with a view to offering employment without the consent of their existing employer. This includes players, managers and staff of EFL clubs as well).

The RPC Sports group regularly advises clients on sports related disputes – including particularly high profile claims in the Commercial Court relating to economic torts such as inducing breach of contract. For more information, please contact Josh Charalambous (Associate), Samuel Coppard (Associate) or your usual RPC contact.]]>

eFootball transfers: Juve and Man U snub FIFA to sign for PES

Wed, 07 Aug 2019 14:35:18 +0100

In the latest development in the battle for eFootball dominance, Juventus and Manchester United have announced tie-ups with Pro Evolution Soccer, with Liverpool FC going the other way and pledging its allegiance to the FIFA franchise.

Juventus

FIFA 20 will not include the Juventus team name, kits or stadium after the Italian champions signed an exclusive deal granting Konami exclusive use of its naming rights for Pro Evolution Soccer ("PES").

The deal means that the latest edition of the PES series (titled 'eFootball PES 2020') will be the only game to feature a fully licensed version of the Serie A side.

EA Sports confirmed that Juventus will be known as 'Piemonte Calcio' in FIFA 20 and future FIFA Mobile Seasons: 'Piemonte' being an Italian translation of the region where Juventus are based, 'Calcio' meaning 'football' in Italian.

Although the team will have a custom badge, kit and stadium, players will have authentic names, faces and features and will continue to have their live ratings updated based on their real-world performances.

The deal represents a real coup for Konami, which has struggled to keep pace with long-time rivals EA Sports in recent times, particularly in terms of football licences.

Manchester United

Elsewhere in the eFootball transfer market, Manchester United has also teamed up with Konami, in an official (but non-exclusive) partnership. Waving goodbye to 'Man Red' and 'Trad Brick Stadium' from previous instalments of PES, eFootball PES 2020 will include Manchester United's player likenesses, club badge, club name, club kits, plus a bespoke 'Matchday' mode. A detailed recreation of Old Trafford will be included in the game, which was only available to play on FIFA last year.

Various Manchester United 'legends' will also be available for use in-game, with David Beckham and Park Ji-Sung already confirmed ahead of eFootball PES 2020's release. Konami have also announced that up-and-coming United midfielder Scott McTominay will be an official eFootball PES 2020 ambassador (and will appear in the front cover of the game alongside Barcelona star Lionel Messi, Bayern Munich forward Serge Gnabry and Juventus midfielder Miralem Pjanic).

Liverpool

Elsewhere, recent Champions League winners Liverpool ended their 3 year partnership with PES and promptly announced a 'long-term' partnership with EA Sports in relation to the FIFA franchise. As part of the tie-up, Virgil van Dijk will appear as a cover star of a special 'Champions' edition of FIFA 20.

Comment

As the eSports market grows, eSports naming rights are clearly becoming big business. According to the Entertainment Retailers Association, the gaming market's value rose to £3.864bn in 2019, more than double what it was worth in 2007.

Expensive deals to gain the rights to team names, kits and even crowd chants (plus an ever-growing inventory of other licensing rights) appear to be here to stay, and now constitute valuable assets in a football club's sponsorship portfolio.

As a result, rights-holders (in particular clubs and players) are well-advised to conduct a full audit of sponsorship opportunities to ensure that they have full visibility over the possible exploitation of their rights (and are not overlooking a lucrative revenue stream).

Equally, sponsors considering major eSports partnerships should ensure they go into commercial negotiations well-armed, for example by obtaining data on forecasted financial returns (by engaging a reputable provider of sponsorship ROI analysis) and exploring the whole spectrum of possible activation opportunities. Some of the main areas we are seeing include bespoke game modes, special edition games, co-branded loot boxes, eSports competitions, joint content, brand ambassador appearances, store-in-stores and experiential campaigns.

RPC's Sports team regularly advises clients on eSports matters (particularly in the IP licensing, sponsorship and retail spaces). Our experience extends to partnership agreements, joint ventures and advertising and marketing regulation. For more information, please contact your usual RPC contact.

Spurs suffer Champions League defeat to the Advertising Standards Authority

Mon, 08 Jul 2019 15:41:00 +0100

The ad

The tweet was challenged by the ASA as the starting line-up contained images of Harry Winks and Davinson Sanchez, who were at the time under the age of 25. The tweet also contained a link to the William Hill website, an image of the gambling operator’s logo and accompanying text which read “Latest odds from @WilliamHill.”

Spurs and William Hill contested that Winks and Sanchez were included in the image simply because they were in the starting line-up. They also argued that whilst both players were under 25 years of age, they were neither the centre of attention of the ad nor shown on an individual basis, and were not of more significance to the team than the other players in the image. Finally, they argued that the underage players were in the image alongside the rest of the starting line-up, all of whom were over the age limit of 25.

The decision

The ASA determined that Spurs' tweet had dual purposes: the first was to notify twitter users of the starting line-up; the second, judged to be equally important, was to offer users the chance to bet on the game.

In its decision making process, the ASA considered Rule 16.3.14 of the CAP Code which states that: “no one who is, or seemed to be, under 25 years old may be featured playing a significant role in marketing communications”.

The ASA held that whilst Winks and Sanchez were of no greater significance than the other players in the line-up, each played a 'significant' role in the marketing communication.

The ASA also looked at whether the inclusion of Winks and Sanchez in the tweet fell under the exceptions that:

those under 25 may appear in marketing communications that are located in a place where a bet can actually be made; and
the person under 25 may only be used in those communications to highlight specific betting selections where that person is the subject of the bet offered. The image or depiction used must show them in the context of the bet and not in a gambling context.

As the tweet was from Spurs’ Twitter account and not a transactional facility through which a bet could be placed (such as William Hill’s own website), and the underage players had not been used to illustrate specific betting selections, the ASA found that the ad fell outside the above exceptions and was in breach of the CAP Code.

Comment / practical tips

The ruling shows a strict application of the “significant role” in Rule 16.3.14 of the CAP Code, and shows that gambling operators will need to take into account each individual's age in a marketing communication, even where other individuals are playing significant roles.

If you wish to include an individual that is under the age of 25 in a gambling ad, make sure that the ad is placed in a location where a customer can make a bet, such as the gambling operator's website. Further, where the individual is used, ensure that they are only there to illustrate the particular betting selections where they are the subject of the bet offered and that the image or other portrayal used shows them in the context of the bet and not in the gambling context.

Finally, sponsors and clubs negotiating sponsorship deals should ensure that the sponsorship agreement contains clear restrictions around the sponsor's ability to feature any members of the club's squad in its marketing. It is better to have this conversation up front, both so the sponsor can weigh up the commercial impact that this might have, and so both parties can avoid the practical and reputational damage of an adverse ruling and takedown for running an ad which falls foul of the CAP Code.

The RPC Sports group regularly advises clients on gambling and advertising matters (including recently advising a leading sports betting business in relation to a high profile partnership agreement with a leading Premier League football club). For more information, please contact Stuart Harris or your usual RPC contact.

Reforms to the FA's Regulations on Working with Intermediaries

Mon, 01 Jul 2019 16:45:00 +0100

The FA's reforms to the Regulations, which are now in force for the 2019-2020 season, introduce obligations on clubs and intermediaries which aim to create more transparency when sharing information with the FA.

The Regulations were introduced on 1st April 2015, and replaced the existing licensing system for agents that had been in place for almost 25 years. Since then, the Regulations have been the subject of heavy criticism, including because they removed the requirement for intermediaries (previously licensed football agents) to pass exams or have insurance.

Intermediaries continue to be in the spotlight for the amount of money spent on agents' fees in recent transfer windows, with figures reportedly climbing to £260 million for the previous Premier League season. The increased revenues coincide with increased scrutiny from external regulators such as HMRC and the SFO on the structure and propriety of agents' fees. It is no surprise that there are now much more serious consequences where allegations of tax evasion and/or fraud are raised.

With intermediaries' influence understandably growing in the game, the FA has sought to balance the interests of various stakeholders in its changes to the Regulations. To summarise the key changes:

Increasing transparency

Making an Offer

New rules A8.1 and A8.2 require that intermediaries notify players both orally and in writing of all offers received as soon as possible or latest, within 24 hours of receipt of the offer.

The change gives clubs the advantage of knowing that all offers must be communicated to the player (without the intermediary being able to omit relevant information about the offer) – something that has been a source of player complaints in recent years.
Some in the market have voiced concerns that clubs may use the rule change to unsettle players and encourage them to hand in transfer requests. Whether this comes to fruition by causing specific issues in the forthcoming transfer windows remains to be seen.

According to the FA's Guidance Notes to the Regulations, an "offer" would include "proposed terms of employment, including fixed or continuing remuneration and term" and must also "comply with all relevant rules and regulations".
The offering club therefore needs to be relatively specific – more than informal suggestions of terms – in order to trigger the obligation on intermediaries. A practical tip to clubs is to ensure that offers are in writing, marked "Offer - subject to contract" (and private and confidential) to minimise the risk of disagreements regarding the new rules.

2. Annual financial reports

Rule C12 states that intermediaries must provide financial reports (annual returns) to their players which show all of the payments made by that player (or by a club on behalf of that player) to the intermediary during a season. The FA can also request to see these reports.

Some have complained of the time commitment this imposes on intermediaries, specifically because there are already requirements to disclose agents' fees and commissions in each transfer.
There is perhaps a wider impact of the rule change. The FA, intermediaries and agencies (and players themselves), continue to receive significant information/document requests from external regulators (eg HMRC). If intermediaries are forced to produce single annual statements on a per-player basis it would simplify analyses of the declarations made by intermediaries regarding the movement of monies involving agents' fees.

3. Disclosing agreements

Rule D5 creates a new obligation that any agreement reached between two intermediaries (or their companies) resolving an intermediary-related dispute must be disclosed to the FA.

It's not clear whether this change would encourage more disputes involving intermediaries – ultimately any disputes between relevant intermediaries would be aired before the FA in any event.

New rule E8(iii) also requires clubs to disclose to the FA agreements with intermediaries "of any nature" regarding the provision of services by the intermediary. Previously the obligation was only to file copies of representation contracts with the FA.
The broad language used by the FA appears to focus on capturing purportedly sham agreements entered into to avoid existing rules within the Regulations. The obvious example, which has given rise to a number of disputes and regulatory investigations previously, being sham "scouting services agreements" which aimed to circumvent restrictions on intermediaries' involvement in a transfer.

B. Fiduciary Duties

Best Interests

Rule A7 now requires an intermediary to always act in the best interests of the club and/or player for whom they act, and in accordance with their fiduciary duties.

This obligation has been commonplace in representation contracts for a long time. The rule change exposes intermediaries to prospective disciplinary proceedings by the FA if they fail to comply with their duties. The battleground over "acting in the best interests" between the FA and intermediaries is one to watch out for.

2. Approaching players under 18

Rule B8(ii) requires intermediaries to obtain the written consent of the player’s parent or guardian before approaching a player between 1 January of the year of the player’s sixteenth birthday and the date of his eighteenth birthday. Approaches are clarified as including communications made to the player across all manner of electronic communications, including WhatsApp and other social media accounts.

This is by far and away the most common offence giving rise to a suspension of intermediaries (including some of the best known faces in the industry) relates to interactions with young players.
There are obvious question marks about how "approach" is to be understood – but the practical response to ensure that intermediaries always seek parental permission before speaking to a young player about representing them.
Keeping records of conversations is also highly advised, either through screenshots of WhatsApp conversations or ensuring that WhatsApp conversations are backed-up regularly.

Conclusion

The new changes are important, but appear to be a precursor to anticipated wholesale reforms expected to be implemented in forthcoming seasons (any time from the start of the 2020/21 season). Those changes are likely to re-consider aspects such as licensing arrangements and caps / bandings for agents' fees.

The RPC Sports group has particular experience in disputes involving intermediaries' roles in player transfers, including acting for a high profile Premier League club in HMRC's football industry-wide investigation into agents' fees. For more information, please contact Josh Charalambous or your usual RPC contact.

Smoke and mirrors? Big Tobacco slip(stream)s back into Formula One sponsorship deals

Mon, 18 Feb 2019 16:40:00 Z

In recent months, two leading Formula One teams have announced major tie-ups that will see them promote non-tobacco 'initiatives' from Big Tobacco companies.

Ferrari announced its deal with Philip Morris' 'Mission Winnow' initiative back in October 2018, with the team featuring the project's brand assets with effect from the 2018 Japanese Grand Prix.

In a statement on 11 February 2019, McLaren confirmed its own partnership with British American Tobacco's 'A Better Tomorrow', with the co-branding revealed at the unveiling of its MCL34 livery on 14 February 2019. The co-branded car will get its racing debut at the Australian Grand Prix on 17 March 2019.

Both initiatives focus on science and innovation rather actively promoting tobacco related products. Philip Morris's 'Mission Winnow' is centred around a simple goal: "[to] drive change by constantly searching for better ways of doing things", and "efforts to transform not only our company but an entire industry for the 1.1 billion people who smoke and those around them".

The link between 'A Better Tomorrow' and BAT is slightly more overt – in addition to the clear anagram, it states that the "multi-year partnership is focused on accelerating its transforming tobacco agenda, at the heart of which is its commitment to providing a portfolio of potentially reduced-risk products (PRRPs), which can deliver a "better tomorrow" for its consumers".

However, questions have been raised about whether these partnerships break advertising rules - particularly within the EU.

Legal position / issues

In the EU, the Tobacco Advertising Directive imposes an EU-wide ban on cross-border tobacco advertising and sponsorship in most media. The AVMS Directive and Council Recommendation 2003/54/EC extend this to television and wider forms of tobacco promotion. From 2016, the Tobacco Products Directive extended the restrictions on tobacco to electronic cigarettes and other 'reduced-risk' products.

The wording of the ban captures any cross-border sponsorship that has the aim or direct or indirect effect of promoting a tobacco (or e-cigarette) product. This begs the question – are these non-tobacco 'initiatives', operated by tobacco companies, caught?

Some think so. The deals have already attracted the attention of Australian regulators ahead of the season opener in Australia (which operates a similar advertising regime to the UK).

The deals also appear to have caught the eye of EU authorities. In a statement to RaceFans, Anca Paduraru, an EU spokesperson for the EU's Health, Food Safety and Energy Union projects confirmed that:

"the Commission continues to closely follow the implementation of the bans of sponsorship and advertising as foreseen by the Tobacco Advertising Directive, also in the context of Formula 1". "Recently, the Commission has been made aware of these recent initiatives by the tobacco industry. They will require further close examination following which the Commission will proceed as necessary."

In an attempt to quell recent controversies surrounding the tie-ups, Philip Morris released a statement emphasising its confidence that it is not in breach of any regulations, whilst McLaren has publicly defended the BAT partnership and has reiterated that it will not be promoting any tobacco products via the deal.

Comment

It remains to be seen whether the European Commission will class Philip Morris and BAT's sponsorship deals with Ferrari and McLaren as lawful manoeuvres. One thing's for sure: with traditional tobacco companies continually diversifying into new markets, the need for greater clarity around the meaning of 'indirect' promotion will only increase.

The outcome of the EU's 'examination' will therefore be watched closely by a large number of stakeholders, including Formula One teams, other potential sponsors (including tobacco and e-cigarette brands), local advertising regulators and anti-smoking activists.

RPC's Sports team regularly advises clients on sponsorship matters, including partnership agreements, marketing / advertising regulation and the Tobacco and Related Products Regulations. For more information, please contact your usual RPC contact.

CMA clamps down on unfair gambling promotions

Thu, 01 Feb 2018 16:21:00 Z

Following the CMA’s investigation into the promotional practices of online gambling operators, three major players (Ladbrokes, William Hill and PT Entertainment (owner of Titanbet and winner.co.uk)) have formally committed to running clearer bonus promotions and ensuring that players can always access and release their own money. The rest of the market must now follow suit, or risk possible regulatory action.

The investigation was prompted by concerns that operators in the sector were breaching consumer laws, including the Consumer Protection from Unfair Trading Regulations 2008 and the Consumer Rights Act 2015.

The CMA found that certain terms in these promotions were likely to be ‘unfair’, in breach of consumer protection law, and could mislead consumers. Promotions under particular scrutiny are those designed to attract players to casino-style websites by offering bonus funds when players put in their own money, for example: “Put down £10, and get £50 to play with!”. The CMA was particularly concerned that people could be made to play for longer than they had bargained for before being able to withdraw their own money.

What should operators be doing?

The Gambling Commission has made clear that operators across the sector must promptly adopt similar changes to those identified, or risk possible regulatory action. Operators are therefore advised to consider the following dos and don’ts:

Do:

Clearly and promptly communicate the significant terms and conditions of all promotions so customers can make an informed decision about whether to participate. Significant terms might include restrictions on gameplay, such as eligibility restrictions, time limits, minimum deposits, maximum bonuses, maximum stakes etc.
Regularly review terms, practices and marketing collateral to ensure that they are fair and comply with consumer law and advertising regulations.
Maintain a proper approval process for signing off on copy (which includes legal review).
Ensure customers can:
- exit promotions at any time and extract their remaining deposit plus any winnings from wagers made with deposit funds; and
- clearly distinguish between playing with bonus funds versus their own money. This could be achieved with pop-ups / communications such as “You are now using bonus funds from us. Once you use these up and any winnings from them, you will be playing with your own money.”
Explain clearly if there are limitations on the amount of money that a customer can withdraw in one tranche.

Don’t:

Attach complicated or unfair play restrictions to customer deposits (for example forcing players to withdraw prize money in small instalments over a long period of time).
Rely on vague / hidden terms to confiscate players’ money.
Deny customers access to their own money - including deposits and winnings earned from customer deposits.
Change ‘live’ promotions once customers have started playing.
Impose terms which allow customer funds to be confiscated if they haven’t played for a few months.
Require customers to take part in compulsory publicity / marketing activity.
Use customer names, photos, locations or other personal data for promotional purposes unless you have their explicit consent to do so.

RPC's Sports team regularly advises clients on gambling matters, including consumer law and marketing / advertising regulation. For more information, please contact Jeremy Drew (Partner).

Spurs 2 : 0 HMRC – termination payment not taxable earnings

Wed, 20 Dec 2017 14:17:00 Z

Background

The case concerned the transfer of two football players, Peter Crouch and Wilson Palacios (the Players), from Tottenham Hotspur (Spurs) to Stoke City (Stoke).

The Players were employed by Spurs in the usual way (ie on fixed term employment contracts). The contracts contained a provision for early termination, either if certain circumstances arose (none of which were present in this case), or by mutual agreement between the Players and their employer.

In 2011, Spurs wished to transfer the Players to another club and had identified Stoke as a possible destination. To help facilitate the move, Spurs made payments to them as part of the agreement to terminate their contracts early.

HMRC considered that the payments made to the Players were earnings because the terms of the Players' employment contracts expressly envisaged, and provided for, termination by mutual consent. HMRC held that any payments received in consequence of implementing those terms was therefore "from" their employment and were subject to income tax and NICs.

Spurs argued that the payments were compensation for the early termination of the Players’ contracts, and were not made pursuant to any specific provision. Accordingly, the payments were made in return for the Players giving up their rights to be employed until the expiry of the fixed term set out in their employment contracts and, as such, were not “from” their respective employments.

In December 2014, HMRC issued determinations under Regulation 80 of the Income Tax (PAYE) Regulations 2003 and decisions under section 8, Social Security Contributions (Transfer of Functions etc) Act 1999, for recovery of the tax and NICs allegedly due on the payments made to the Players.

Spurs appealed against the determinations and decisions to the FTT. The FTT allowed Spurs' appeal.

HMRC appealed to the UT. The main issue before the UT was whether the fact that the players’ employment contracts included clauses expressly allowing for the early termination of their fixed terms by mutual consent was sufficient to establish that the agreed termination payments were "from" an employment.

UT decision

HMRC's appeal was dismissed.

In the view of the UT, there is a distinction between the situation where the entire contract of employment is terminated in exchange for the termination payment, and cases where payment was made pursuant to a pre-existing obligation to make such a payment arising under a contract of employment. In the latter case, such payment was "from" an employment.

The UT concluded that the payments made in relation to the Players fell squarely within the first category. The payments compensated for the surrender of rights as part of the abandonment of the Players' contracts, they were not from their employment (for example, a payment in lieu of notice under an express term of their employment contracts), but from their termination.

The UT also noted that, under HMRC’s view, any contractual provision permitting early consensual termination would be sufficient to make the termination payment made "from" an employment. This would result in almost all termination payments agreed in respect of a fixed term contract being caught as the contract would always contain an express or implied right to agree an early termination.

Comment

The UT's decision carefully analyses the relevant case law and its confirmation of the relevant test will be welcomed by taxpayers (including clubs).

However, the benefit will be relatively short-lived as Finance (No 2) Act 2017 changes the law so that all taxable termination payments are to be subject to employer NICs. This was to come into effect from 6 April 2018 but has been deferred until April 2019.

The RPC Sports group includes specialist tax litigators with experience in all aspects of dealing with HMRC's civil and criminal enquiries in sport.

For more information please contact Adam Craggs or Michelle Sloane.

A copy of the decision can be viewed here.

Swansea City player Bony keeps former agents in play

Thu, 14 Sep 2017 14:13:00 +0100

The facts

The question in this case was: had the defendants established an implied agreement with the claimant to incorporate FA Rule K Arbitration which would have called for a stay of the English Court proceedings?

The claim is brought by Wilfried Bony against his former agents (the Agents) and Swansea City FC (Swansea) (together the Defendants). The judgment – here – sees the Agents appealing the decision of a District Court Judge who refused to stay proceedings pending FA Rule K Arbitration.

Wilfried Bony is a professional football player from the Ivory Coast. Bony moved to Swansea in July 2013 from Dutch club SBV Vitesse. In January 2015 Bony made a high profile switch to Manchester City FC (Man City) and was, at the time of the hearing, loaned from Man City to Stoke City (Stoke). In the latest transfer window, Bony has re-signed for Swansea and the club has indicated that there are no outstanding disputes between them. Since Bony joined Swansea in 2013, he has been registered as a player and falls within the definition in the FA Rules. Swansea, Man City and Stoke are all "Clubs" under the FA Rules.

The First and Third defendants are Bony's former agents. The Second and Fourth defendants are companies owned by the former agents (and incorporated in the Ivory Coast and Czech Republic respectively).

The underlying claim brought by Bony alleges that the Agents received secret commissions in excess of £8m from Swansea (the Fifth Defendant) between July 2013 and February 2015. There is a standalone allegation against the First Defendant for fraudulent and/or negligent misrepresentation concerning alleged inducement into an image rights deal.

There were various written agreements between the claimant and the Agents governing the relationship between them. None of those agreements referred to the FA Rule K Arbitration. Only one of those agreements contained an express dispute resolution procedure (DRP) – and that referred to arbitration before the Czech FA, and the FIFA Players' Status Committee (the PSC).

After the District Judge held that the proceedings should not be stayed, the Agents appealed. They submitted that the decision that there was no agreement between the parties to arbitrate was incorrect and strongly criticised the District Judge for not considering whether an implied agreement existed – this argument was scorned by the appeal judge.

The Law

If a party seeks a stay in English Court proceedings in order to arbitrate, it must be by reference to an arbitration agreement which complies with Section 5 of the Arbitration Act 1996 (the Act).

The agreement to arbitrate must be in writing. Importantly, where parties agree orally or impliedly to terms which are themselves in writing, the parties are deemed to have made an agreement in writing for the purposes of the Act (see s.5(3) of the Act).

However, the onus is on the party asserting such an oral and/or implied agreement to show that the written terms include the relevant arbitration clause relied upon.

In seeking to demonstrate an implied agreement to arbitrate (which incorporated such terms in writing), the Agents cited a train of cases which they submitted implied a contract between participants of an organised sport based on the rules that govern that sport. The Agents' aim was to show that the parties were "Participants" under the FA Rules, and that this created an implied horizontal contract between them which incorporated the terms of those FA Rules, specifically regarding FA Rule K Arbitration.

The Decision

The Court found that the Agents failed to establish the existence of such implied agreements.

The Agents' case relied upon the Court implying a contract between the Claimant and each of the Agents. This was not supported by the case law and so the Court turned to general principles of contract law.

The relationship between the Claimant and each of the Agents was subject to and governed by express agreements meaning there was no basis on which it was necessary to imply another agreement. None of those express agreements contained DRPs which could be relevant.

The Court dismissed the appeal and decided that the District Judge was correct in refusing to stay these proceedings.

Comment

The landscape of disputes in sport is becoming dominated by parties from different countries engaging in disputes relating to player transfers and/or player contract negotiations. Those disputes typically involve agents/intermediaries and players, with myriads of oral and written agreements.

In the light of the greater international scope of disputes, and the differing preferences in which forum should hear the dispute (CAS, national sport specific forums, private arbitrations, national courts), determining jurisdiction is especially important.

It remains to be seen whether the FA Rules will be amended to expressly state that they are intended to apply horizontally between Participants as well as vertically between the FA and the Participant – akin to the Premier League rules which are stated to constitute an agreement between each Club and the Premier League, and between each Club directly (See Rule B.15). In such circumstances it would be easier to show the existence of an agreement to arbitrate.

This is a timely reminder of the importance for parties in the wider sporting and commercial context to carefully consider the merits and demerits of different forms of dispute resolution when entering into agreements, and to make any agreements clear.

The RPC Sports team is particularly experienced in dispute resolution within football, including advising on proceedings in arbitration and before national courts. We will be writing a more detailed analysis of this case for an upcoming edition of Sweet & Maxwell's Entertainment Law Review.

For more information please contact Josh Charalambous or Nicole Jahanshahi.

Edgar Davids wins League of Legends image rights claim

Wed, 23 Aug 2017 14:56:00 +0100

Background

Edgar Davids, an icon of football in the late 90s and 00s, was always pro-active in commercialising his image as a player. Fans of video games may remember Davids as being a front cover feature of the FIFA Football 2003 video game alongside Roberto Carlos and Ryan Giggs.

Fast forward 14 years and Davids remains active in the protection of his image and likeness.

League of Legends is an online multiplayer video game developed and published by Riot Games. It is regarded as (at least one of) the most played PC games in North America and Europe. It is actively played in eSports tournaments around the world and is one of the largest global eSports in its own right.

League of Legends introduced a new character skin which converted an original character, Lucian, into a modified "Striker Lucian" – in essence putting Lucian in a football kit and making him look like Edgar Davids (similar broad jaw, skin tone, dreadlock hairstyle, angular tinted protective googles, football kit).

Enforcing image rights…home or away?

Publicity rights or image rights are a key feature of commercialisation in sport, but their treatment under law is not harmonised across Europe.

Each EU Member State has separate frameworks when it comes to individuals protecting their image. Member States generally perceive publicity and image rights to be personality rights. This creates obligations on third parties not to use or recreate an individuals' likeness without consent. The commercial aspect of personality rights for high profile sports stars like Edgar Davids means that continental Europe is often seen as a less restrictive (and therefore more attractive) forum for protection and enforcement.

By contrast, there is no specific image right under English law. Here sports stars must rely on a patchwork of principles and concepts to try and prevent the unauthorised use of an image (such as passing off / false endorsement).

Davids has lived in England since 2010 but retains his Dutch citizenship – given the more favourable framework, Davids chose the Dutch courts as the forum in which to bring his claim.

The court in Amsterdam found that the combination of the similar elements between Striker Lucian and Davids described above caused the public to associate or identify Striker Lucian as being Edgar Davids (or based on Edgar Davids). The court relied on evidence showing League of Legends players drawing such a conclusion in online messages. It was also discovered that Riot Games themselves (via an employee) admitted that Davids was the inspiration for the Striker Lucian skin.

It has been widely reported that Riot Games sought to argue that League of Legends players would not have recognised Striker Lucian as being Edgar Davids – the court was not persuaded.

What are the key takeaways?

The exploitation of image rights in sport is big business. The individual whose image is being exploited generally holds the image rights, although corporate entities may hold the rights for tax efficiency purposes.

Either way, there is an economic interest in protecting and enforcing image rights in ways akin to protecting and enforcing intellectual property rights – both should be given equal weight when developing a sports star's strategy to commercialising the brand. However, it is vital to be conscious of the fact that image rights are not harmonised in Europe, and that careful strategic thinking with regard to brand protection is required, including where to enforce.

The RPC Sports team specialises in brand protection and advising in relation to image rights. It also incorporates specialists from the firm's dedicated Tax team who regularly advise clients on the tax implications of image rights, including issues/queries raised by HMRC.

For more information please contact Nicole Jahanshahi or Josh Charalambous.

Barton succeeds in reducing betting ban

Fri, 04 Aug 2017 09:45:00 +0100

The RPC Sports team published this update on the FA Commission's decision to ban Joey Barton for 18 months (and this blog uses the same definitions). Joey Barton's ban followed various breaches of FA Rules concerning bets on professional football matches. Since then, Barton has succeeded in persuading the FA Appeal Board to reduce his absolute ban from football activities by nearly 5 months, meaning his suspension will now end on 1 June 2018 instead of 25 October 2018. The FA Appeal Board maintained Barton's financial penalty of £30,000.

The Appeal

Nick De Marco of Blackstone Chambers (acting for Barton as he did in the main hearing) argued that: 1) an 18 month ban was excessive; and 2) the Commission failed to give reasons for rejecting independent expert evidence concerning Barton's gambling addiction.

The 18 month ban was excessive

De Marco submitted that the 18 month ban was disproportionate to previous decisions of the FA Commission. No player previously convicted of betting against his own team, in matches he did not himself play in, had received a ban greater than 6 months. Moreover, bans of 12 months or more had only been handed to players who had placed bets on their own team, and then played in those matches – often with other serious aggravating factors also at play.

The FA Appeal Board rejected this argument – in doing so it noted that one FA Commission was not bound by the decision of previous FA Commissions. The Guidelines expressly state that a player betting on his own team is a serious aggravating factor and that it is the duty of the FA Commission to carefully consider each aggravating and mitigating circumstance. With the important exception of the FA Commission's handling of expert evidence, discussed below, the FA Appeal Board considered that the reasoning behind the 18 month ban to be correct.

No reasons for rejecting independent expert evidence

Expert evidence of Barton's gambling addiction was put before the FA Commission, which accepted various aspects of the expert's opinion. However, on the issue of the severity of addiction, it was persuaded by the FA's arguments which (importantly) were not themselves based on expert evidence.

Barton's gambling addiction was not disputed. The degree of control Barton had over that addiction was a crucial issue. The expert's central opinion was that Barton was not addicted to gambling for monetary reasons (he was a wealthy man who never bet beyond his means). Instead, Barton had a moderate to severe addiction to the process of gambling itself.

In the absence of any satisfying reason for rejecting this part of the expert evidence, the FA Appeal Board found that the FA Commission had acted unreasonably. In doing so, they considered this aspect of the evidence to be a compelling mitigating factor and reduced Barton's suspension accordingly.

Why is this important?

The decision of the FA Appeal Board shows, importantly, that it is willing to challenge, correct and critique the decisions of the FA Commission. It is an inherent part of a system without binding case law that concerns exist about the range and disparity of sanctions handed down by FA Commissions.

It means that the independence of FA Commissions is inevitably called into question, especially where the reputation of the characters involved may precede the facts.

The written reasons of the FA Appeal Board are available on the FA's website here.

Using VR in sports – virtual insanity or future reality?

Tue, 01 Aug 2017 12:26:42 +0100

The Premier League team has followed Arsenal's lead and signed a deal with Beyond Sports with the aim of using VR:

to provide ready-made training scenarios for players, focussing on on-field spatial awareness, decision-making and high pressure in-game scenarios; and
as a post-match analysis tool using real match data, allowing players to relive in-game situations and recognise what could be done differently in future.

Beyond football, VR presents athletes in other fields with the ability to augment their training regimes, for example, STRIVR Labs are a start-up working with six NFL teams. The benefits of VR are enhanced in the context of American football, as it allows players to minimise their exposure to the physically damaging nature of the game, reducing the risk of injury. Further, VR is particularly useful in the context of the recovery of injured players, in the words of STRIVR CEO and former Stanford kicker, Derek Belch "We’ve seen guys that couldn’t practice because of injury come into VR and put the headset on and actually go through [their] footwork at 10 percent speed”.

In addition to its use for athletes, football clubs have begun exploring the use of VR to improve, and even reimagine, the fan experience. In August last year, Bayern Munich became the first football club to show a live match in VR and, more recently, Manchester City have recently launched a VR offering with Jaunt Inc. The experience enables fans to access a game day experience from the comfort of their own living room and reduces the barriers of entry for them (e.g. those who cannot attend live games due to the distance they live from the stadium or because of the ever-increasing prices for attending live matches). The appetite also appears to be there for fans, with LiveLike's recent VR broadcast of Barcelona v Real Madrid capturing 37,000 viewers, even more impressive when you consider it was with less than a week's notice and behind a paywall.

However, clubs should consider the potential complications of taking advantage of VR technology. For example, in the context of using VR for training, staff will likely be handing over confidential tactical data to the entity providing the technology. This type of information is akin to trade secrets for sports clubs and they go to great lengths to protect it, such as on the recent Lions tour to New Zealand where the coaching staff decided to have a security company regularly sweep the team's hotel for listening devices. As a result, a detailed risk/reward assessment will need to be made by clubs before disclosing their 'crown jewels' to any third party and, at the very least, they should consider:

including robust confidentiality provisions into any agreement with a VR provider to help mitigate the risk of this information being lost or leaked; and
undertaking thorough due diligence on the potential supplier's systems or any third party system on which the provider relies, to ensure that they are secure.

There is no doubt that the potential is there for sports related entities to exploit VR technology. The next few seasons will serve as a test for VR, during which we may see a change in football viewing habits if fans favour a more cost-effective and convenient way of achieving the experience of attending a live match. Equally, as noted above, it will be interesting to see whether more sports entities utilise VR to enhance their training procedures. Either way, it seems sensible for clubs to consider turning the commercial and training opportunities presented by VR technology into realities.

The RPC team is particularly experienced in contentious and non-contentious matters involving football sponsorship (both kit and shirt sponsorships) and supply agreements. For more information please contact Andrew Crystal or Joseph Byrne.

A shot in the arm for football sponsorship – clubs take advantage of new shirt sleeve regulations

Mon, 24 Jul 2017 10:00:00 +0100

On Saturday, Chelsea FC was the latest club to announce an official sleeve partner for the 2017/18 season, with club shirt sponsor Yokohama extending its existing partnership rights. From next season, the logo of Yokohama sub-brand Alliance Tyres will feature on the sleeves of the team's 2017/18 shirts.

Chelsea follow Southampton (Virgin Media), Leicester City (Siam Commercial Bank), Manchester City (Nexen Tire), Crystal Palace (Dongqiudi), Watford (138.com), Huddersfield (PURE Business Group), Stoke City (Top Eleven) and Swansea City (Barracuda) who have already made use of the new commercial opportunities presented by the FA's relaxation on advertising rules relating to shirt sleeve sponsorship.

As set out in the FA Guide to Advertising Regulations, the new Regulations for 2017/18 expressly permit sponsor advertising on "one single area not exceeding 100 square centimetres on the sleeve of the shirt" (section C.1(a)), which was announced following the end of the Barclays / Premier League title sponsorship deal last year. Interestingly, the new Regulations also permit a slightly larger front of shirt logo (now a maximum of 250 square centimetres for the 2017/18 season, up from 200 square centimetres in the 2016/17 season). The new Regulations provide a useful visual representation of the permitted sponsor designations for next season (see page 18 of the FA Guide) for those who are keen to review.

Although the financial details of most arrangements have not been made public, the deals highlight the potential opportunities for new and existing sponsors to create or expand partnerships with football clubs, and reap the various commercial benefits (including increased brand awareness, brand association and brand equity).

Given that the uptake on sleeve partnerships has been relatively slow, it seems likely that many sponsors and clubs have been navigating their way through various commercial issues under existing sponsorship deals. Whether you are a sponsor or a club, the importance of carefully planning and negotiating sponsorship agreements (and considering the obstacles under any agreements already in place) is clear. With the landscape of advertising changing so rapidly, clubs and sponsors must future-proof their sponsorship deals, and have a keen eye on exclusivity clauses which can make or break future opportunities for advertising income.

RPC's Sports team regularly advises clients on sponsorship matters (including kit and shirt sponsorships) and advertising / marketing regulation. For more information, please contact Stuart Harris (Associate) or Andrew Crystal (Senior Associate).

Indian sports broadcast network 'bowled out' for breach of a media rights agreement

Tue, 18 Jul 2017 14:59:20 +0100

Background

Parties

New Zealand Cricket is the national governing body of cricket in New Zealand and the owner of the right to broadcast cricket matches played in New Zealand (the Rights). It entered into a Media Rights Agreement with the defendants in 2013.

Both defendants are incorporated in India. The first defendant, Neo Sports Broadcast Pvt Ltd, owns two pay TV sports channels. The second defendant, Nimbus Communications Ltd, is involved in sports broadcasting in India.

The Agreement

The Agreement was governed by English law and provided that the courts of England and Wales should have exclusive jurisdiction. Under the Agreement Neo Sports was granted a licence to the Rights until 2020, in exchange for paying a licence fee of $50m (in instalments) to New Zealand Cricket.

When the Indian men's cricket team toured New Zealand, part of the licence fee was required to be paid in advance. 65% of the advance payment was due to be paid at least 30 days before the scheduled start of the tour, and Neo Sports was required at the same time to provide security for the remaining 35% of the advance payment via a letter of credit. Nimbus guaranteed the performance of all of Neo Sports' payment obligations under the Agreement.

The breach

The Indian men's cricket team toured in February and March 2014, and pursuant to the Agreement Neo Sports was due to pay c.$8.7m (and provide the letter of credit for c. $4.7m) on 20 December 2013. Neo Sports failed to pay the sum due on that date and also failed to provide the claimant with the letter of credit.

On 21 December 2013, New Zealand Cricket served notice requesting Neo Sports to remedy the default within seven days. Pursuant to the Agreement, failure to comply with this request gave the claimant the contractual right to terminate the Agreement. Neo Sports did not comply with the request and New Zealand Cricket served a termination notice in January 2014.

Bad faith

In January 2014, Neo Sports alleged in correspondence that, after the date for payment had passed (and the notice served), New Zealand Cricket had contacted other organisations in India offering to sell the Rights that had been granted exclusively to Neo Sports in the event that the Agreement terminated. The allegations were that the contact with other organisations:

amounted to a breach of the exclusivity provision in the Agreement;
breached a provision of the Agreement which granted Neo Sports the exclusive right to exploit the advertising rights; and
breached an implied covenant of good faith and fair dealing.

Neo Sports claimed in the correspondence that the breaches amounted to a material breach of the Agreement incapable of remedy giving Neo Sports the right to terminate the Agreement.

New Zealand Cricket did not deny that such discussions had taken place, but did deny that it amounted to a breach of an obligation under the Agreement (whether express or implied), and that any alleged breach was capable of being a repudiatory breach in any event.

Proceedings

In November 2014, New Zealand Cricket issued proceedings in England and Wales. The defendants had appointed Couchmans LLP as their agent for the purpose of accepting service in connection with the Agreement, and Couchmans LLP filed an acknowledgement of service on behalf of the defendants, which did not contest jurisdiction. The defendants failed to file a defence.

In circumstances where a claimant does not apply for summary judgment within six months of the defence due date, the claim is stayed under CPR Rule 15.11(1). To lift the stay and apply for summary judgment, New Zealand Cricket required the court's permission. The application by New Zealand Cricket was served on Couchmans LLP, still formally on the record, but who explained that it was no longer instructed to accept service.

Out of caution (as technically service was deemed legally effective), New Zealand Cricket applied for permission to serve the application and supporting documents on the defendants out of the jurisdiction in India. The court granted permission for such service but the defendants chose not to file any evidence in response to the application, appear or be represented at the hearing.

Decision

Should the stay be lifted?

Either party can then apply to the court for the stay to be lifted. The court held in Michael Wilson & Partners Ltd v Sinclair [2015] EWCA Civ 744 that, provided at least some explanation has been given for the relevant delay, relief should be granted in a situation where the relevant delay has had no material impact on the efficient conduct of the litigation.

New Zealand Cricket explained that the six month delay was a result of obtaining advice on the ability to enforce an English judgment against the defendants in India, and on the appropriate course to take in the proceedings.

Leggatt J found that the delay here had no material impact on the efficient conduct of the litigation, and therefore the stay should be lifted.

Should summary judgment be granted?

With the stay lifted, New Zealand Cricket sought summary judgment on the outstanding sum of c. $8.7m (plus contractual interest) which fell due on 20 December 2013.

The test for summary judgment comes from CPR Part 24 which asks if the defendant has a real prospect of successfully defending the claim. The burden to show a real prospect of success is on the defendant, but there is a relatively low hurdle to overcome. In circumstances where the defendants had dis-instructed solicitors and refused to engage with proceedings, Leggatt J found that the defendants’ silence was “telling and would be a sufficient reason in itself to grant the application”. However, Leggatt J decided to consider the earlier correspondence between the parties and consider the arguments ran by the defendants in them.

Leggatt J rejected the allegations by Neo Sports that New Zealand Cricket was in repudiatory breach of the Agreement, and particularly that New Zealand Cricket had acted in bad faith. In particular: "a party which is in breach of contract and which faces termination of the contract within a matter of days if it continues to fail to comply with its obligations cannot complain".

He went on to say that not only should that party not complain, it would not be bad faith for the party who suffered loss as a result of the initial breach to seek to mitigate its loss in the event the earlier breach is not remedied. In fact, evidence was provided by New Zealand Cricket which showed that Neo Sports had proposed the contact between New Zealand Cricket and the third party broadcasters via its agent.

The court held that the defendants had no real prospect of successfully defending the claim and awarded New Zealand Cricket summary judgment for the amount of the outstanding debt (plus interest) with the remaining damages to be assessed.

Comment

The judgment provides a useful illustration of how the court will exercise its discretion to lift a CPR 15.11(1) stay and progress a case in circumstances where the defendant disengages.

Where the evidential burden rests with the defendant, and that defendant has disengaged, the court is reluctant to decide in the absence of testing its arguments. Without pleadings the court has shown that it will consider the earlier correspondence between the parties.

The bad faith arguments run in correspondence were bound to fail, especially in circumstances where the party alleging bad faith was the instigator of the actions it later complained of. It is, however, useful to see that actions of New Zealand Cricket were viewed as steps to mitigate loss in the light of the imminent (and likely) termination of the Agreement.

This material was first published by Sweet & Maxwell in Entertainment Law Review (Volume 28; Issue 5; ISSN: 0959-3799), and is reproduced by agreement with the publishers.

Bournemouth bets on shirt sponsorship deal with M88

Wed, 05 Jul 2017 10:24:37 +0100

In recent years gambling companies have become prominent features of football shirt sponsorship – they are typically more liquid than companies in other sectors, and the opportunity to invest cash for instant, wide-ranging exposure to a core customer base is attractive.

For next season at least 15 English Premier League and Sky Bet Championship clubs will have gambling companies as primary shirt sponsors.

The latest announcement sees AFC Bournemouth partner with Asian gambling company M88, with the latter named official shirt sponsor for the next two seasons.

There are certain additional considerations when negotiating shirt sponsorship deals with companies in the gambling industry, especially those based outside the UK. For a more detailed overview please see this piece Joshua Charalambous and Andrew Crystal wrote for LawInSport.

It is a useful reminder for stakeholders that:

There are specific rules and regulations which govern the advertising of gambling products. Those products must not be targeted at children. Questions arise: does the club slice the advertising opportunities by seeking different commercial partners (one for adult kits and one for children's)? Is the gaming company happy that another brand might advertise on the children's kit? Or do the parties come up with a creative solution to take the opportunity to support a charity by offering it space on children's kit only?
Offshore gambling companies must be licensed by the Gambling Commission in order to be permitted to advertise to consumers in the UK – this is an additional barrier and should be considered by those seeking to partner with emerging companies in international markets.
The explosion of innovative gaming and gambling technology and related issues such as athlete welfare, sports data, and integrity mean that sport and gambling are becoming ever intrinsically linked. As a heavily regulated industry, it is important to recognise and consider social challenges which stakeholders face and cater for that in any contracts.

Almost every professional football club in the UK's top leagues has a betting partner – whether as a primary shirt sponsor or exclusive betting partner. The English Football League itself has entered into an agreement with Sky Bet to sponsor its league competitions. It is therefore vital to be aware of the nuances in dealing with this sector when negotiating significant partnerships.

The RPC Sports team is particularly experienced in dealing with contentious and non-contentious matters involving sponsorship and partnership agreements, including within the gambling sector. For more information please contact Joshua Charalambous.

Barton bets big and loses: sanctions, mitigation and next steps

Mon, 15 May 2017 14:51:00 +0100

Background

Joey Barton has experienced a full and well publicised career at a number of clubs including Manchester City, Newcastle United, QPR, Marseille, Burnley and Rangers. This latest indiscretion involves a misconduct charge brought by the FA.

In 2016, Barton was charged with misconduct for breaching rules prohibiting betting on football matches. Whilst there is no suggestion that Barton was engaged in match fixing, he placed 42 bets on 20 matches involving teams he was registered in, including two matches in which he played. Of those 42 bets, 15 were bets that his team would lose (although note that Barton did not play in matches involving those 15 bets).

The FA Rules

Which rules apply?

Under Part E of the FA Rules, it is prohibited to bet on football matches (Rule E8). Each bet placed is deemed to be a separate breach of the rules. During the 2005 to 2008 seasons the FA Rules prohibited participants from betting on the result, progress, or conduct of a match or competition in which they participated or had influence. In 2009 this extended to "participated in that season" and by 2014 the FA Rules covered total prohibition from football related betting all over the world.

The Football Regulatory Authority (the FRA) established guidelines in 2011 (the 2011 Guidelines) to assist the Commission in deciding which rules should apply. Those guidelines developed over the 10 year period in question, and the current version has been in place since the 2014/2015 season (the Current Guidelines). There was a debate over which iteration of the guidelines ought to apply to determine the sanction for Barton's misconduct (the misconduct itself was accepted by all parties).

Barton submitted that bets placed before the start of the 2011/2012 season were not covered by the 2011 Guidelines, which ought not to be applied retrospectively. The FA argued that the correct approach is to analyse the whole misconduct using the Current Guidelines. This was supported by reference to various Court of Appeal precedents.

Barton's awareness of the FA Rules

During the hearing, Barton openly admitted that he knew betting on matches was against the FA Rules, but didn’t realise the extent of the FA Rules.

“…. I didn't know it was everywhere in the world….. But I knew it was forbidden for me to bet on my own league and….if we had played in the FA cup….”

In 2012, Barton was sent a letter from the FA highlighting the FA Rules after tweets from his Twitter page which were deemed to be betting tips were brought to the FA's attention.

Barton openly admitted that he placed at least some of the bets despite knowing that he was breaching the FA Rules. Barton also accepted that he had a professional responsibility to understand the detail of the FA Rules and that he took no adequate steps to do so (and in fact continued to bet in breach of the FA Rules).

The Decision

It was decided that the fair and reasonable way to sanction Barton would be to consider the aggravating and mitigating factors and impose a single global sanction to reflect all of the 1,260 individual cases of misconduct.

The aggravating and serious factors included:

the 15 bets Barton placed on his own team to lose;
the total number of bets; and
the letter Barton received in 2012 when he was directly warned about his gambling.

The mitigating factors submitted in response included:

the fact that Barton had proven that he was addicted to gambling;
there were no suspicious bets or large returns from his bets (actually Barton lost £16,708.29;
Barton never concealed his identity when placing the bets;
Barton entered into a guilty plea early on, and he made significant admissions during interviews expressing remorse throughout; and
Barton offered to provide help and advice to other players who may be dealing with addiction.

The Commission ultimately relied on the fact that Barton has enjoyed a full career but has been found to have been breaching the betting rules for a substantial part of that career. After balancing the aggravating and mitigating factors, the decision was to ban Barton from all football and football activities for 18 months with immediate effect, impose a £30,000 fine, and order Barton to pay the costs of the hearing.

Why is this important?

The case raises the question of what mechanisms sports organisations (including clubs) can put in place to protect the welfare of their players, and their business. Sport is not exempt from the expansion of gambling and gaming in modern society. As an issue, gambling addiction is just one of the many challenges facing players in football today (and athletes in sport more generally) – we have recently seen a much needed increase in awareness of the mental health challenges individuals face across society, including sport.

Aside from the clear social responsibility of sports organisations to help protect players, the business case to do so is clear. Barton has been banned towards the end of his career. However, if a young superstar with high commercial value and on £200,000 a week is banned for a significant period of time for breaching gambling regulations, the ramifications for losing a major playing and commercial asset are obvious.

The RPC team has particular experience in dealing with contentious matters involving football. For more information please contact Joshua Charalambous.

Hacked – IAAF victim of cyber-attack compromising athlete data

Mon, 10 Apr 2017 10:08:00 +0100

Background

The IAAF released a statement last week (3 April 2017) stating that it had been the "victim of a cyber-attack" in February, which had targeted athletes who had made applications for Therapeutic Use Exemptions (TUEs).

Athletes make applications for TUEs when they require an exemption for the therapeutic use of a substance (or method) that is otherwise prohibited by WADA. It is believed that the IAAF has since made contact with more than 80 athletes who made applications for TUEs since 2012. The IAAF has also set up a dedicated IAAF email address and online query portal (askiaaf.org), for athletes with any queries or concerns about their TUEs applications.

The attack was detected during an investigation by cyber security firm Context Information Security (CIS), who were engaged by the IAAF at the beginning of the year to conduct a technical investigation of IAAF systems. CIS discovered that unauthorised remote access to the IAAF network had been made, with metadata on athlete TUEs "collected from an IAAF file server and stored in a newly created file".

Whilst the extent of the breach is not yet known, the IAAF has claimed that the hacking group Fancy Bears (also known as APT28, Pawn Storm, Sofacy Group, Sednit and STRONTIUM) was behind the attack.

Comment

The attack highlights the importance of having adequate security measures in place to deal with cyber-attacks, particularly for sporting organisations that hold highly sensitive / confidential information. An example of some of the measures you should consider taking include:

Processes should be put in place to deal with data loss and security breaches (e.g. having a robust, tested data breach response / management procedure in place to quickly ID intrusions and find a resolution). This should set out reporting lines, responses, escalations, and be integrated with a comprehensive business continuity policy – make sure people in the business know how to respond and who to tell;
Invasive investigations into data security (for example trial data breaches and "friendly hacks" to identify weaknesses) should be conducted on a regular basis;
Access controls should be implemented to prevent unauthorised access / use. This includes:
- Physical controls (e.g. alarms, locked cabinets, swipe cards, waste disposal); and
- Logical controls (e.g. user identification and authorisation, passwords, biometrics) access restrictions;
Anti-virus software / firewalls should be installed on any systems and devices used to store and transmit data – and remember to update and maintain them;
Data should not be stored or accessed locally on devices which are not accessed through a secure network (e.g. desktop files);
Any portable and mobile devices used to store and transmit personal data should be protected using approved encryption software;
The following logs should be kept for audit purposes:
- logs of data transfers and when data is accessed; and
- logs of laptops and other portable and mobile devices (e.g. ensuring devices are returned by former personnel).
All personnel should receive training on personal data and the importance of data security, including how to recognise attempts to gain unauthorised access to data by "spoofing", "phishing" or "blagging", the potential consequences of failure to comply with internal and external rules on data security, and what to do in the event of a data breach;
Processes shall be put in place to ensure the secure destruction of data when required (e.g. confidential disposal / destruction for hardware, hard copies and electronic data, anonymising data);
Senior management may consider obtaining cyber insurance, to provide cover for the potential cost of data breaches (for example public relations, forensic investigation, legal advice, notification, web and credit monitoring).

RPC's Sportsand Media teams regularly advise clients on data and privacy issues.

RPC also has deep-rooted data compliance expertise, including RPC's integrated data breach response service, ReSecure. With one call, ReSecure provides you with access to a combined team offering data breach management, technical forensic investigation, legal advice, notification, web and credit monitoring and public relations services.

Sleeve sponsorship – a new trick up the sleeve for Premier League teams

Mon, 03 Apr 2017 16:28:16 +0100

With the value of sleeve space estimated to be worth 15-20% of a Premier League club’s front-of-shirt sponsorship, it seems it will only be a matter of time until other teams follow suit. For example, it has been reported that a sleeve sponsor could be worth nearly £10m to Manchester United who currently make £47m a year from Chevrolet.

The announcement is a timely reminder of the importance of carefully negotiating sponsorship agreements and considering the value of any agreements already in place.

Clubs will need to identify whether existing agreements contain any problematic clauses for such sleeve sponsorship opportunities, for instance exclusivity arrangements. Such clauses may prevent clubs from selling jersey space to companies in the same sector as their front-of-shirt sponsor or, in the extreme, to any other potential sponsor at all. In this scenario, teams may need to bargain with current sponsors if they wish to make space on their shirt sleeves and, in this regard, it may be worth considering notice and termination provisions. It is also a reminder, when clubs are negotiating new sponsorships agreements, to have a keen eye on exclusivity clauses as they may close the door to the opportunity for further advertising income.

On the other hand for sponsors, does having a sleeve sponsor dilute the value of your front-of-shirt sponsorship? Sponsors too might be considering their positions, and appropriate contractual protections, in the event other clubs pursue such sleeve sponsorships. Thus clubs should consider the effect that introducing a new commercial partner will have on existing close associations. In some cases, it may have potential to jeopardise the relationship. An example could be a club whose front-of-shirt sponsor also has stadium naming rights.

According to the former commercial director of Tottenham, sleeve deals could be the start of a new focus on commercialising previously ignored inventory as the growth of broadcast rights value slows. With this in mind, teams will want to ensure flexibility in their commercial arrangements with existing sponsors.

It is clear that the appetite for utilising the international coverage of the Premier League continues to grow. Next season it will be in the form of shirt sleeves sponsor. In the future, we may see new opportunities arise such as back-of-shirt deals (which already exist in Spain). Clubs will need to be commercially savvy to ensure they are able to take advantage of these opportunities.

Going for Gold: A New Code for Sports Governance

Mon, 30 Jan 2017 01:30:00 Z

In this article for Entertainment Law Review first published in January 2017, Joshua Charalambous discusses the backdrop to the changes, and explores the key aspects of the Principles and subsequent mandatory requirements provided for by the Code. This material was first published by Sweet & Maxwell in Entertainment Law Review (Volume 28; Issue 2; issn 0959-3799), and is reproduced by agreement with the Publishers.

Summary

All UK sports bodies and organisations that rely on, or wish to receive, public finding will now have to adhere to a new Code for Sports Governance (the Code). The Code aims to create a more transparent sports sector in the context of increased funding and potential threat of misuse of public and private funds. The expectation is that the Code will ensure that a gold standard of governance will be achieved in UK sport, and that it will be amongst the most advanced in the world.

The Code is underpinned by five key principles which act as the foundations of good sports governance. They are: 1) structure; 2) people; 3) communication; 4) standards and conduct; and 5) policies and processes (the Principles).

Sports bodies and organisations have until the next wave of public funding in 2017 to ensure that they are compliant with the Code. This article outlines the backdrop to the changes, and explores the key aspects of the Principles and subsequent mandatory requirements (Requirements) provided for by the Code.

Background

In December 2015, the Government announced a New Strategy for an Active Nation aimed at tackling the flatlining levels of participation in sports and high levels of inactivity in the UK. In the foreword to the new strategy, David Cameron stated that the Code would be a response to journalists “lifting the veil on corruption and poor governance at the heart of some of the biggest international sports”.

A Charter for Sports Governance in the United Kingdom was announced earlier in 2016 setting out what it expected the Code to cover, with the Code being officially published on 31 October 2016. A copy of the Code is available on the Sport England website.

The key changes apply to all sports bodies and organisations which receive (or wish to receive) funding from UK Sport or Sport England. It therefore applies equally to elite and grassroots organisations. To account for this, the Code contains a three-tiered approach depending on the level of investment an organisation receives. This is intended to be flexible, and the Principles will flow through all elements of the Code.

The Code is easy to use, with the Principles in red and the Requirements in blue. The Code then provides a commentary on the Requirements to assist organisations in demonstrating ways in which they can ensure compliance. There is also an appendix of definitions.

The Principles

Each Principle is accompanied by the question: “Why is this important?”.

1. Structure

Organisations should have a clear and appropriate structure, led by a board which is collectively responsible for the long-term success of the organisation.

Why is this important? The Code highlights the importance of good structure to investors, staff and suppliers whilst also ensuring a strong framework for organisational growth and development.

2. People

Organisations shall recruit and engage people with appropriate diversity, independence, skills, experience and knowledge to take effective decisions that further the organisation’s goals.

Why is this important? Diverse, skilled and experienced decision-making bodies which contain independent voice and engage in constructive, open debate enable good decision-making.

3. Communication

Organisations shall be transparent and accountable, engaging effectively with stakeholders and nurturing internal democracy.

Why is this important? Being responsive to stakeholders and hearing their interests helps shape governance and strategy. There should be transparency about why the organisation exists, what it is trying to do, how it is trying to do it, and with what results to empower stakeholders.

4. Standards and Conduct

Organisations shall uphold high standards of integrity, and engage in regular and effective evaluation to drive continuous improvement.

Why is this important? The right values and culture helps protect public investment and enhances the reputation of the organisation, earning stakeholder trust. Constantly seeking to improve makes an organisation swift to respond to challenges and opportunities.

5. Policies and Processes

Organisations shall comply with all applicable laws and regulations, undertake responsible financial strategic planning, and have appropriate controls and risk management procedures.

Why is this important? Understanding the legal environment and having in place appropriate financial and other controls help mitigate risk and enhance stakeholder trust.

The three-tier approach

Tier 3

Tier 3 represents the top level of Requirements in the Code. The Tier 3 Requirements represent the level of investment of public money in the bodies and organisations. Typically, UK Sport or Sport England will categorise an investment as Tier 3 if:

The funding is intended to be granted over several years;
The funding is granted for a continuing activity rather than a one-off project;
The total amount of funding is greater than £1m.

Tier 2

Tier 2 catches levels of investment that does not sit within Tier 3 or Tier 1. This might be because the investment is one-off (rather than long-term), or where the investment represents the start of a new strategic relationship between UK Sport/Sport England and the organisation.

Organisations receiving Tier 2 investment will be expected to comply with all Tier 1 Requirements, and some Tier 3 Requirements (which would be decided depending on the circumstances of the organisation and nature of investment).

Tier 1

Tier 1 represents the minimum level of Requirements. Tier 1 is designed to ensure the protection of public funding through good governance whilst not creating an administrative burden. Typically, UK Sport or Sport England will categorise an investment as Tier 1 if:

It is granted on a one-off basis (for example, for a specific project with a finite life);
The total amount of funding is less than £250,000.

Requirements

Tier 1 Requirements (for all investments)

The organisation must be properly constituted, have a clear purpose and, if membership based, be inclusive and accessible;
The governing committee must meet regularly and record decision making;
Conflicts of interest must be recognised, managed by the chair and recorded. At least three people on the committee must be unrelated or non-cohabiting;
In deciding who sits on its governing committee the organisation considers the skills and diversity required of its committee members;
Committee members are subject to regular election and ideally should serve no longer than nine years;
The organisation must have a bank account and two independent signatories are required for payments; and
Annual accounts must be prepared and scrutinised independently of the person responsible for finance. The annual accounts should be made available to members to describe how money has been spent.

To assist organisations in complying with the requirements, the Code sets out a commentary. This commentary includes advice ranging from suggesting the number of times a governing meeting ought to meet to fulfil the “regular” meeting in Requirement 2); the suggestion is four times a year, to examples of when a conflict of interest might arise per Requirement 3); the Code states that a committee member would have a conflict of interest in circumstances where they (or a family member) receives a personal benefit from a committee decision.

The Tier 1 Requirements are straightforward, but it is vital that all sports organisations receiving investments undertake a compliance review sooner rather than later.

Tier 3 Requirements (for all Tier 3 and some Tier 2 investments)

The Tier 3 Requirements are, understandably, much more onerous. A summary of the key Requirements is set out below. It is crucial for any sports organisation receiving significant investment to review its corporate governance and undertake a thorough compliance review and risk analysis against each of the Requirements in the Code (not just those summarised below).

The board should be of appropriate size to meet the organisation’s requirements and have an appropriate balance of skills. In any event, the board should be limited to 12 people (unless otherwise agreed with UK Sport or Sport England).
The board should be the ultimate decision-making body and be responsible for setting the strategy of the organisation. The council should not be able to override the board.
25% of the board should be independent non-executive directors.
Subject to a few specific exceptions, a director may serve on the board for a maximum of eight years (in either four terms of two years, or two terms of four years) or nine years (in three terms of three years).
Each organisation shall adopt a target of, and take all appropriate actions to encourage, a minimum of 30% of each gender on its board, and demonstrate a strong and public commitment to progressing and achieving gender parity and greater diversity on its board (including but not limited to BAME diversity and disability).
Each organisation should adopt a mandatory directors’ code that, among other things, requires all directors to always act with integrity, in a forthright and ethical manner, and in accordance with the organisation’s conflicts policy.
Each organisation should publish directors' pay and, where the organisation employs over 50 staff, senior management pay.
Each year the board should evaluate their performance and ensure that an external provider evaluates the board’s performance every four years.

How will the Code be enforced?

We await the separate guidance referred to in the Code. That separate guidance will inform users how UK Sport and Sport England intends to monitor and assess compliance against the Requirements.

It is worth noting that at the time of writing the UK Government is looking at reforms to corporate governance structures which are primarily aimed at large private companies. Much of the Code has similarities with the UK Corporate Governance Code (which applies to London Stock Exchange listed companies). It will be interesting to see whether UK Sport/Sport England will adopt similar enforcement criteria to those used in corporate governance situations.

What can organisations do to prepare?

Simply, any sports body or organisation ought to review its rules and regulations alongside the new requirements and ensure compliance as soon as possible. A top tip is to use the Code to collate each Requirement and undertake a risk analysis based on the existing rules, thereby identifying any gaps or shortfalls.

There are then new documents that will need to be prepared. Given that the Code is much more prescriptive than the existing approach to sports governance, organisations should start drafting now if they have not already done so. There must be new policies and procedures to ensure board, council and chairperson compliance (including descriptions of the chairpersons’ roles). The new targets for inclusion and diversity will likely require new written policies.

Despite significant work required to review compliance, it is a fantastic opportunity for sports bodies and organisations to refresh the rules and regulations to ensure best practice.

Chelsea swap Adidas for £900m Nike deal

Fri, 28 Oct 2016 10:32:43 +0100

With the value of commercial partnerships in a seemingly perpetual escalation, it comes as no surprise that Chelsea's new agreement with Nike is reportedly worth twice the previous deal with Adidas per year.

According to some sources, Chelsea agreed to pay around £40 million to terminate the Adidas agreement six years early, which serves as a well-timed reminder of the importance of termination clauses in sport sponsorship contracts.

Termination clauses provide flexibility to parties operating in a dynamic and growing market; as shown by how quickly the Chelsea/Adidas agreement fell behind the market value.

A top-tip when drafting termination clauses is to consider whether any termination payment is mutually beneficial or too costly to pursue. Both Chelsea and Adidas put positive spins on the termination pay-off. Chelsea entered into a new, more profitable agreement and Adidas commented that the payment will positively impact the group's net income.

Notice periods are also important. In the context of football supply agreements, where replica kits are designed and agreed well in advance, it is vital that the parties use notice period provisions to create a sufficient buffer ahead of termination.

Sponsors drop lying Lochte - the fallout from Rio 2016

Wed, 24 Aug 2016 13:52:46 +0100

Sponsors made the announcements after Lochte was found to have lied about being robbed at gunpoint during a night out in Rio de Janeiro. In fact, Lochte and some team mates vandalised a petrol station toilet door.

Speedo has reportedly sponsored Ryan Lochte for approximately 10 years and confirmed that it will donate $50,000 of Lochte's sponsorship fee to Save the Children in Brazil. Ralph Lauren confirmed that its agreement with Ryan Lochte only lasted for the duration of Rio 2016 and that it would not be renewed going forward.

The precise details of the various endorsement agreements remain confidential, but it is likely that sponsors triggered anti-embarrassment clauses.

It is a timely reminder of the importance of anti-embarrassment clauses for sponsors. Anti-embarrassment clauses are almost a necessity as sponsors seek to protect brand image from unknown future events. Of note in this case, is that US Newspapers ran headlines that included Speedo's name ("Liar, Liar, Speedo on fire").

A top-tip when drafting anti-embarrassment clauses is to keep the wording as broad as possible, as public perception as to what might be embarrassing or socially unacceptable can change during the lifetime of an agreement.

For more information on anti-embarrassment clauses and their role in sponsorship agreements, in the sport sector and beyond, please contact Jeremy Drew or Joshua Charalambous.

China’s richest man strikes deal to host new global football tournament

Thu, 21 Jul 2016 09:44:38 +0100

Last week it was announced that the Group, a conglomerate run by Wang Jianlin (China’s richest man), has struck a deal to host an international football tournament in China next year.

The Dalian Wanda Group is reinforcing its reputation as a significant player in sports investment. It acquired the Ironman Triathlon for a reported $650m in August, owns a 20% stake in Atletico Madrid, and is the first Chinese top-tier FIFA partner. It has also been announced that the Group will be the FIBA’s exclusive partner for the sale and marketing of sponsorship and licensing rights for some of the basketball governing body’s main events.

Dubbed the China Cup, the new international tournament will take place annually in Nanning starting in January 2017. It will initially involve four international teams (including China) before expanding in subsequent years. The tournament has been approved by FIFA, the Chinese Football Association and the Asian Football Confederation.

The sports division of the Dalian Wanda Group will own the IP rights for the China Cup, and no doubt it will attract a plethora of potential sponsors and partners. It has been reported that the Group has been liaising with over 100 stakeholders in order to develop the proposal, in a move that adds yet another layer to China’s emergence as a football powerhouse.

Penalty saved by CAS with a little help from English Courts

Mon, 06 Jun 2016 11:08:41 +0100

Mon, 06 Jun 2016 11:08:41 +0100SportsJoshua CharalambousThe Question

In Pencil Hill Ltd v US Città Di Palermo S.p.A, the CAS award found that a penalty clause was, in part, enforceable, and this raised a question for the English High Court as such a clause is unenforceable under English law.

The question was whether the enforcement of a penalty clause by an English court via an arbitral award was contrary to public policy, or whether there was a more convincing argument that ensuring that international arbitration awards are enforced was in the interests of public policy (s. 103(3) of the Arbitration Act 1996).

The Facts

Pencil Hill Limited owned the financial rights to Paulo Dybala after it acquired them from his club in a Third-party ownership structure. In April 2012, Serie A club Palermo agreed to purchase the financial rights from Pencil Hill Limited in order to sign Dybala as a summer transfer. The purchase price was EUR 10m which was due in various instalments.

After defaulting on the instalments, Pencil Hill Limited relied on the ADR clause to seek payment of the outstanding amounts from CAS. As part of the claim, Pencil Hill Limited pointed to a penalty clause which required any outstanding amounts to be due, plus another payment equal to the outstanding amounts to be due (effectively doubling the amount outstanding under the contract).

The Decision

CAS exercised its discretion under Article 163.3 of the Swiss Code of Obligations to reduce the size of the penalty award, to the money outstanding plus 25% of the penalty claimed. Bird HHJ disagreed with Palermo that there was a pressing public policy issue which ought to prevent the award being enforceable. Bird HHJ explained that it was more important to enforce international arbitral awards and that, the exceptions which rely on public policy exceptions, must infringe a universal principle of morality. Bird J also relied on the fact that the parties elected to contract under Swiss law in the first place.

Why is it important?

The CAS tribunal effectively held that the penalty clause was unfair and it reduced it to an amount which it felt reflected a more fair position. It is therefore important to consider what CAS might consider fair when negotiating an agreement with a CAS ADR clause.
This penalty clause was governed by Swiss Private Law and does not impact on the recent Supreme Court ruling in Cavendish Square Holding – see here.
This does not mean penalty clauses can simply be inserted into contracts with foreign ADR provisions. CAS held that Swiss law required a penalty to be reduced and it was confirmed that the reduction meant the penalty no longer contravened Swiss law. English law does not permit courts to intervene to reduce penalty clauses to make them enforceable in the same way.

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World eSports Association formed

Thu, 26 May 2016 16:45:37 +0100

ESL announced the development on its website here.

Named the World eSports Association (“WESA”), it aims to regulate and standardise the field of eSports, whilst also providing an opportunity to narrow the differences between the large number of global stakeholders in the industry. Currently, many of the rules and regulations are implemented on a competition by competition basis.

It is hoped that the recent focus on standardising eSports on a national level will result in an innovative and thriving eSports sector, especially when combined with the opportunity to have standardised contracts, a global equivalent of football’s transfer window etc. One of the key implementations is the Player Council, elected by players to represent and advocate pro gamers on issues such as league policies and transfers.

However, some have raised concerns that WESA’s inherent link with ESL is not independent enough for WESA to position itself as a FIFA/ IOC style governing body (two ESL employees are also on the five-person board of WESA). We await to discover whether WESA can shake off these potential issues, but we are certain that eSports is a sector destined for growth affecting the full range of legal practice areas.