Rangers v Sports Direct (Latest Court Case – Verdict Awaited)

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As others have said, I freak out whenever this thread re-appears on the first page, so sorry for bumping it!

It’s a bit difficult to get the head round exactly what’s been happening. We aren’t given the full terms of the contract and some of the judgments are a bit vague as to what the actual order made by the court ultimately is once the Court’s decision was made.

There actually seem to be at least 2 separate actions ongoing. The case which went to the “speedy trial” in April has case reference 000631 of 2018 (per the report from February 2019), but the case with the decision in March 2019 has case reference 000726 of 2018.

The 726 case is about determining the terms of a new contract entered into between SDI and us following on SDI matching Elite’s offer in July 2018. The creation of this new contract was provided for in the 2017 retail agreement. It’s been determined this new contract exists but its terms haven’t yet been finalised. In the March 2019 judgment, the Court interpreted things broadly in line with what SDI wanted, but the final order wasn’t published as far as I’m aware, and I’m not really clear what that means for what the new contract with SDI will include. No doubt a major issue will be whether this new contract includes the right for SDI to match subsequent offers again (which SDI argue it should.) This contract was determined to “exist” from 25th July 2018, although it's actual terms haven't been fully determined yet (at least per the published judgments.) Once its terms are finally determined, no doubt the next question becomes have we breached this new contract in some way since July 2018.

The 631 case originally related to whether a failure to allow SDI to match a subsequent September offer by Elite was a breach of the 2017 Retail agreement. The claim is for declaratory and injunctive relief and damages, but the “speedy trial” isn’t dealing with damages. That question has been deferred until after the issues of declarator and injunctive relief have been decided. Declarator is an order by the court declaring something. In this case I imagine it is that the Elite contracts mentioned below breach the agreement with SDI. Injunctive relief is an order not to do something. In this case it will be not to operate in a way which continues to breach this contract, presumably.

In 631, the court has already determined we are in breach of the 2017 retail contract re failing to allow matching of the September offer, and has already granted permanent injunctions per the judgment of 24/10/18. The speedy trial relates to a request for further declarators and injunctions which SDI say are necessary/justifiable because they have now seen further agreements between RFC and Elite (Retail Units Agreement and the Elite/Hummel agreement.) They say we also failed to allow SDI to match these, and are accordingly in further breach of contract.

Ultimately 631 will also determine what damages are payable for the already established breach re the September 2018 offer, and potentially for the further breaches SDI allege if these are indeed found to be breaches following the speedy trial.
 
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@Marty101 my reading of that is that my previously outlined worst fears may be about to be realised. :eek: Namely, that we are ‘forced’ to give some or all of the retail contract back to SDI plus we get hammered for ‘damages’.

Please re-assure me I’ve got it wrong.:(
 
I believe that SD have been pressing for contempt of Judge Teare’s original order for the club to inform Elite as to the court ordering no deal and any existing to immediately cease.

Judge Teare also appeared to agree that any ceiling for damages was inadequate, how Judge Persey interprets previous rulings in arriving at his own, we can only hope for parity.
 
Valley Bluenose said:
@Marty101 my reading of that is that my previously outlined worst fears may be about to be realised. :eek: Namely, that we are ‘forced’ to give some or all of the retail contract back to SDI plus we get hammered for ‘damages’.

Please re-assure me I’ve got it wrong.:(
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Sorry... Best I can tell SDI already have a new contract dealing with some of the retail elements going forward - equivalent to whatever was in the July 2018 Elite offer. From the March 2019 decision:

"SDIR in its 25 July 2018 notice expressly matched the material terms in the notice of offer. There was a contractually-prescribed offer and acceptance. My interpretation of paragraph 5.7 in context is that a further agreement came into existence at that point, to take effect immediately on the Agreement coming to an end. The precise wording of that further agreement needs to be determined. To that extent the matching process has not been finalised, but that has no effect on the further agreement's existence.

CONCLUSION

The claimant is entitled to declarations along the lines it sought in the Part 8 claim form, but with modification in accordance with the rulings in the judgment. In light of the judgment the parties should agree the wording of the further agreement. At this stage I am not persuaded that in these proceedings the court should have any role in this. "

What that actually means in practice though...?

We're presumably already in breach of that contract, so a damages claim under that contract too - presumably with the same £1 million cap?

Also does the new contract include matching provisions? If so we could face further injunctions under this contract if we don't allow SDI to match whatever rights are included by this further contract whenever it comes up for renewal.

From what I've read I don't think we're finished with this by a long shot, pretty much no matter what happens re the recent "speedy trial."

All I can say to soften the blow of that is I'm just doing my best piece together the position from what's actually publically available, so there may easily be elements I'm unaware of or misinterpreting.
 
Marty101 said:
Sorry... Best I can tell SDI already have a new contract dealing with some of the retail elements going forward - equivalent to whatever was in the July 2018 Elite offer. From the March 2019 decision:

"SDIR in its 25 July 2018 notice expressly matched the material terms in the notice of offer. There was a contractually-prescribed offer and acceptance. My interpretation of paragraph 5.7 in context is that a further agreement came into existence at that point, to take effect immediately on the Agreement coming to an end. The precise wording of that further agreement needs to be determined. To that extent the matching process has not been finalised, but that has no effect on the further agreement's existence.

CONCLUSION

The claimant is entitled to declarations along the lines it sought in the Part 8 claim form, but with modification in accordance with the rulings in the judgment. In light of the judgment the parties should agree the wording of the further agreement. At this stage I am not persuaded that in these proceedings the court should have any role in this. "

What that actually means in practice though...?

We're presumably already in breach of that contract, so a damages claim under that contract too - presumably with the same £1 million cap?

Also does the new contract include matching provisions? If so we could face further injunctions under this contract if we don't allow SDI to match whatever rights are included by this further contract whenever it comes up for renewal.

From what I've read I don't think we're finished with this by a long shot, pretty much no matter what happens re the recent "speedy trial."

All I can say to soften the blow of that is I'm just doing my best piece together the position from what's actually publically available, so there may easily be elements I'm unaware of or misinterpreting.
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The court has not ordered Elite to stop selling our merch. I think that has major significance. SDI's contracts with Rangers may well exist, but if Hummel refuse to supply SD with orders there isn't anything SDI can do.
Another significant consideration is Elite/Hummel have their own retail division, and with that a lot of retail legal expertise. It's difficult to see why Hummel would have bothered if they hadn't assessed the risks first and been confident in how it would unfold.
DK has said SDI's success in court to date has been with interim and urgent proceedings. However, when all the facts are heard and considered by the court he expects Sports Direct to fail.
One thing for certain is as long as Elite are distributing our merch Sports Direct will never sell a stitch of it.
What's your take on DK's opinion and Elite's likelihood of remaining our non exclusive merchandise partner?
 
@Marty101 I’m sure I read that Hummel won’t supply SD because SD are ‘slow payers’ in other words they agree 60/90 days to settle invoices but stretch it out to 120 days and Hummel insist on 60 days maximum.
So whilst Rangers May be in breach of contract with SD the side issue is Hummel won’t supply them. Also are Elite and Hummel not connected?

This remains a shambles one thing I really don’t understand is the legality of the original SD contract surely it’s not mutually beneficial and the RFC directors who agreed it were ex SD employees? Does that not impact the court in any way?
 
bob1873 said:
@Marty101 I’m sure I read that Hummel won’t supply SD because SD are ‘slow payers’ in other words they agree 60/90 days to settle invoices but stretch it out to 120 days and Hummel insist on 60 days maximum.
So whilst Rangers May be in breach of contract with SD the side issue is Hummel won’t supply them. Also are Elite and Hummel not connected?

This remains a shambles one thing I really don’t understand is the legality of the original SD contract surely it’s not mutually beneficial and the RFC directors who agreed it were ex SD employees? Does that not impact the court in any way?
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Not when it is a stitch up
 
Can anyone say what the effect of Judge Teare's ruling is.

  1. Accordingly, I grant Sports Direct a third injunction on the following terms:

  2. "Rangers shall:​
    (1) not perform the Elite Agreement;​
    (2) not assist Elite to perform the Elite Agreement; and​
    (3) inform Elite that it will not perform the Elite Agreement."​
 
silks said:
Can anyone say what the effect of Judge Teare's ruling is.

  1. Accordingly, I grant Sports Direct a third injunction on the following terms:

  2. "Rangers shall:​
    ​
    (1) not perform the Elite Agreement;​

    ​
    (2) not assist Elite to perform the Elite Agreement; and​

    ​
    (3) inform Elite that it will not perform the Elite Agreement."​
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I don’t think Rangers are breaking the above terms, as our agreements are with Hummel. Marty or one of the other guys would be able to clear that up I’m sure.
 
bob1873 said:
@Marty101 I’m sure I read that Hummel won’t supply SD because SD are ‘slow payers’ in other words they agree 60/90 days to settle invoices but stretch it out to 120 days and Hummel insist on 60 days maximum.
So whilst Rangers May be in breach of contract with SD the side issue is Hummel won’t supply them. Also are Elite and Hummel not connected?

This remains a shambles one thing I really don’t understand is the legality of the original SD contract surely it’s not mutually beneficial and the RFC directors who agreed it were ex SD employees? Does that not impact the court in any way?
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The contract they are dealing with in Court is the one that was signed in 2017 and expired in 2018 and which, on its conclusion, we were bound to offer SDI ‘matching rights’ on the next one. It was signed by our current Directors unfortunately.
 
Valley Bluenose said:
The contract they are dealing with in Court is the one that was signed in 2017 and expired in 2018 and which, on its conclusion, we were bound to offer SDI ‘matching rights’ on the next one. It was signed by our current Directors unfortunately.
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Cheers for clarifying that but is it not a follow on from the original deal signed by Lambias?
 
mart22 said:
The court has not ordered Elite to stop selling our merch. I think that has major significance. SDI's contracts with Rangers may well exist, but if Hummel refuse to supply SD with orders there isn't anything SDI can do.
Another significant consideration is Elite/Hummel have their own retail division, and with that a lot of retail legal expertise. It's difficult to see why Hummel would have bothered if they hadn't assessed the risks first and been confident in how it would unfold.
DK has said SDI's success in court to date has been with interim and urgent proceedings. However, when all the facts are heard and considered by the court he expects Sports Direct to fail.
One thing for certain is as long as Elite are distributing our merch Sports Direct will never sell a stitch of it.
What's your take on DK's opinion and Elite's likelihood of remaining our non exclusive merchandise partner?
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Dave King has access to more information than I have about what’s going on, so I’m sure he’s in a better position than I am to assess things! :D



None of the cases reported on the Court website deal with any direct attempt by SDI to take an injunction against Elite, so I’m not sure to what extent that’s actually been tried. I remember there were certainly threats they would do so though. Elite aren’t a party to either of the 2 cases, so an injunction against them directly couldn’t be granted in either of them - but there could be other cases which aren't currently reported.

In the 631 case, Elite tried to argue they should be allowed some sort of representation at the proof. The court denied them their application, saying that if they wanted to come in the action they would have to do so formally, and not in the sort of half way house approach they were suggesting. Elite said in that case that they wanted in to the action as the orders sought (i.e. the ones to be dealt with at the “speedy trial”) would cause Elite to suffer “very significant financial losses” if successful.

It does suggest to me that there’s something at stake re whether Elite could continue to operate the contract in the event SDI succeed, but I don’t know the exact declarator/injunction orders sought by SDI in their amended claim, so it’s difficult to be sure.

It isn’t necessarily the case that it is easier to get interim injunctions than perpetual injunctions. They are two different issues. At the interim stage the court has to look at balance of convenience. It’s not just a question of who is right and who is wrong at the interim stage. That's because the Court doesn’t know who is right and who is wrong, so it tries to work out what course causes least inconvenience to the parties whilst still protecting the position of both parties.

E.g. the court might think party A doesn’t need an interim injunction, as even if party A turns out to be correct, A will be entitled to damages in the end anyway so A isn’t prejudiced by not getting interim injunction at the initial stage. The court might weigh that against the possible effect on party B if it granted an interim injunction to A. What if it turned out that B was right all along and a grant of interim injunction would have a devastating effect on B?

In that sort of scenario even if party A turns out to be correct in the end the court might be justified in not granting interim injunction originally.

At the final stage, balance of convenience doesn’t come into it. The Court has heard the case and is determining who is right and who is wrong. It would grant an injunction against B if A was entitled to it without really having to consider the effects on B.

I think it’s probably right that the decision there is a new contract with SDI has no major effect at the moment. Where I think it might be significant though is when it comes to renewal time.

The reason we were able to enter the contract with Elite was that the original interim injunction was dropped because we indicated we accepted that SDI were entitled to match. Having done that we then entered into the contract with Elite in September.

We weren’t in breach of interim injunction at that time because it had been dropped. Next time around, SDI will be wise to that. So, if there is this new contract, and if it does include the same matching provisions as the old one, then at that point I would think SDI will try to “fence us in” with interim injunctions to take back control of the retail (at least in so far as provided for in the new contract created in July 2018.)

I don’t think we’re at risk of some sort of catastrophic award of damages being made against us, It’s more the drip-drip of never ending litigation that worries me.

We really can’t afford to be facing damages actions every year and constantly being strangled by SDI’s legal actions every time we are trying to negotiate deals.
 
Valley Bluenose said:
The contract they are dealing with in Court is the one that was signed in 2017 and expired in 2018 and which, on its conclusion, we were bound to offer SDI ‘matching rights’ on the next one. It was signed by our current Directors unfortunately.
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The way I see it everything happening is necessary to get rid of Sports Direct. That one year deal was the beginning of a tough road. At the end Sports Direct will be gone. There is no clean, quick way to get rid of them. It's litigation all the way because Sports Direct are parasitic c*nts. Using the court as their means of forcing themselves onto an unwilling host.
 
mart22 said:
The way I see it everything happening is necessary to get rid of Sports Direct. That one year deal was the beginning of a tough road. At the end Sports Direct will be gone. There is no clean, quick way to get rid of them. It's litigation all the way because Sports Direct are parasitic c*nts. Using the court as their means of forcing themselves onto an unwilling host.
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As has been said all along by many of us, the new deal at least gave us the power to go to market and get better terms than we had with SD on the 7 year deal. The worst case was that SDI had to match those terms, so we could effectively force a normalisation of the retail share onto SD even if we couldn't quite walk completely away from them.

The problems seem to have been with the differing interpretations of the level of detail of any proposed deals we were expected to provide them to allow them the opportunity to match.

From there it has grown arms and legs and turned into a clusterfck.

I fear we've tried to be a bit too smart by half in finding a loophole to bump them for good and might end up just tied back in with them and carrying a bit of a fine to boot. We'll see.
 
Bluenose1979 said:
As has been said all along by many of us, the new deal at least gave us the power to go to market and get better terms than we had with SD on the 7 year deal. The worst case was that SDI had to match those terms, so we could effectively force a normalisation of the retail share onto SD even if we couldn't quite walk completely away from them.

The problems seem to have been with the differing interpretations of the level of detail of any proposed deals we were expected to provide them to allow them the opportunity to match.

From there it has grown arms and legs and turned into a clusterfck.

I fear we've tried to be a bit too smart by half in finding a loophole to bump them for good and might end up just tied back in with them and carrying a bit of a fine to boot. We'll see.
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That's a fairly reasonable interpretation of where things are at. However, it's not an interpretation I agree with anymore. I don't want to speculate too much, but I think a lot of planning and thought has gone into what had to be done. All the bases were covered.
Sports Direct are as good as gone. There is no way back for them.
 
Laudrup22 said:
We are due a break,hopefully judge sees commonsense.
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The Scottish Court of Session ignored the laws of the land to instead implement " common sense " when we ended up at the Supreme Court regarding HMRC. The scumbag Lord Carloway, who had previous with us when he tried and failed to force an illegal transfer ban on our club, was unsurprisingly part of that Scottish Court of Session Panel. We still have a long road ahead, imo, before we are genuinely free of these seemingly endless courtroom appearances.
 
Can our legal team speak of previous contracts with spd?if I was rangers qc I would want to show the judge the whole picture.ie,Hastley signed contracts the day before spies booted out,why mr fat man do you want to sell strips a tiny minority want to buy?did you not try to have mr king jailed?theres no money to be made,why spend more on courts than what you would make from merch.i would put fat man in the dock and ask those questions.
 
tazzabear said:
Would they not have to use some factual data as well?
For example, previous sales.
Based on that, they must know we wouldn’t going to SD.
They must know then, that the extra sales would be zilch.
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Using the previous sales would also mean SD letting it out the bag how much they’re holding back from us
 
Would someone mind giving me a quick summary of this, are SD trying to challenge the Elite/Hummel deal?

I don't think we're even officially involved in that
 
mart22 said:
That's a fairly reasonable interpretation of where things are at. However, it's not an interpretation I agree with anymore. I don't want to speculate too much, but I think a lot of planning and thought has gone into what had to be done. All the bases were covered.
Sports Direct are as good as gone. There is no way back for them.
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I hope you're right. Don't feel as optimistic as you, but I sincerely hope we get shot of them - even for a price.
 
Necro said:
Would someone mind giving me a quick summary of this, are SD trying to challenge the Elite/Hummel deal?

I don't think we're even officially involved in that
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Yes they are, but I think you're correct that technically we're not even involved - hence why the last judge refused to block it at the previous hearing. I think that was essentially the can of worms he wasn't prepared to open by crossing the two situations over into one ruling.

I think SD if they still want to challenge Elite will need to do so separately.
 
mart22 said:
That's a fairly reasonable interpretation of where things are at. However, it's not an interpretation I agree with anymore. I don't want to speculate too much, but I think a lot of planning and thought has gone into what had to be done. All the bases were covered.
Sports Direct are as good as gone. There is no way back for them.
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I am sure we all hope you are correct however I continue to fear the worst.
 
mart22 said:
That new contract was the first step on the road to getting rid of Sports Direct. They are a bully and don't like it when their target fights back.
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Sorry you have lost me, what has that got to do with Dave King and Paul Murray willingly signing and lauding a new contract in June 2017, also the club paid SDI £3 million, what was that all about.

As far as I can see we would have been better sitting out the 7 years and terminating cleanly and legally, the amount of money that this nonsensical vendetta has cost in lawyers and payments to SDI + costs cancels any benefits stone dead.
 
silks said:
Sorry you have lost me, what has that got to do with Dave King and Paul Murray willingly signing and lauding a new contract in June 2017, also the club paid SDI £3 million, what was that all about.

As far as I can see we would have been better sitting out the 7 years and terminating cleanly and legally, the amount of money that this nonsensical vendetta has cost in lawyers and payments to SDI + costs cancels any benefits stone dead.
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You have your opinion because you're wilfully ignoring facts. SD had matching rights in the original deal, and in the new deal that recently expired.
The vendetta is held by Sports Direct against Rangers. They have been a dreadful commercial partner. The sooner we are rid of them the better.
Where we are now is where Sports Direct and their litigation have led. Thankfully the board have a strong resolve to do what's best for Rangers. They have stood up to SD's bullying tactics, and are doing whatever it takes to get rid of them once and for all.
 
mart22 said:
You have your opinion because you're wilfully ignoring facts
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I have my opinion because I am sticking to facts, your thesis appears to be based on wishful thinking and ignoring multiple court judgements against us.

Any how it will end as it ends, we can only hope for a good result, as others have intoned I doubt on known facts that will be the outcome, but we live in hope.
 
silks said:
I have my opinion because I am sticking to facts, your thesis appears to be based on wishful thinking and ignoring multiple court judgements against us.

Any how it will end as it ends, we can only hope for a good result, as others have intoned I doubt on known facts that will be the outcome, but we live in hope.
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Sports Direct have been granted interim relief by the courts so far. Their tactic at urgent and interim proceedings is to drown the court in papers that have no chance of being read in time, leading to the court granting them relief pending a full hearing. When all the facts are heard Dave King believes Sports Direct will be found out. And their efforts to sabotage our commercial progress will fail.
 
silks said:
Sorry you have lost me, what has that got to do with Dave King and Paul Murray willingly signing and lauding a new contract in June 2017, also the club paid SDI £3 million, what was that all about.

As far as I can see we would have been better sitting out the 7 years and terminating cleanly and legally, the amount of money that this nonsensical vendetta has cost in lawyers and payments to SDI + costs cancels any benefits stone dead.
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The 7 year deal would have just led to here anyway with matching clauses etc, King and Co moved us forward by YEARS to get us to here in 2019.

But you knew that anyway.....
 
EndOfDays said:
The 7 year deal would have just led to here anyway with matching clauses etc, King and Co moved us forward by YEARS to get us to here in 2019.

But you knew that anyway.....
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If you insist , but It didn’t because it was reneged on, and the new deal is and has been reneged on making matters worse, however you probably didn’t know that already.
 
silks said:
If you insist , but It didn’t because it was reneged on, and the new deal is and has been reneged on making matters worse, however you probably didn’t know that already.
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Of course it did, they were helping themselves to stadium naming rights for £1 and putting in 7 year notice periods at the time.
 
The way I see it the original onerous contracts were put in place by people who were perfectly entitled to sign them. If I remember correctly Green desperately wanted Ashley to invest in his company and would probably have agreed to pretty much anything to achieve that.

There have of course been subsequent variations, however the current board has been working at a severe disadvantage ever since it took over and has been trying to sort this issue out. They may have had to push certain boundaries in order to achieve what they have already. That may end up costing even more than it already has, however what were the alternatives.

I think people are now getting to the stage of thinking let's just get this sorted out, one way or another.
 
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