SD v RFC Judgement

[alex wright]

Scotsman reporting that we could be forced to cancel the deal we have with Hummel.

Don't see why this is as they are our Kit Suppliers and don't actually sell the kit directly.

The deal that broke the terms of the SD Contract was the Elite merchandise deal. Not the hummel one?

We packaged manufacture and distribution together, which meant it was subject to the SD matching clause, I think.

 

[MosesMcNeil99]

This line of thinking isn't something I would lean on. The idea that we could just continually keep acting outwith the orders of the court and just pay £1m is wildly unrealistic IMHO and not going to carry us forward.

I think this also assumes that sports direct won’t eventually walk away if this will be the constantly trodden path. Again i would say we will always be the defendants here so have no choice but they will have to keep going on that merry go round - it is damaging everyone’s reputation and the courts are getting extremely fed up. That much is clear from the language the judge uses this time round.

 

[wtownsley]

We packaged manufacture and distribution together, which meant it was subject to the SD matching clause, I think.

We kept it tight together but i don't actually think SD would be able to chose our Kit Manufacturer. They've only got a matching right in selling the club's offical kit

 

[clubdeckcharlie]

It can come from Rangers, all they have to say is that they disagree with the decision as it is contrary to natural justice; that the club intends to appeal and finally, to thank fans for their continued loyalty.

Agreed but they don’t have any choice now as by saying nothing sales will grind to a halt until we are told . To be fair if legally it can’t come from them directly , there will be other outlets the fans will trust , club1872 etc .

 

[Bluenose1979]

The problem is though we did allow SD to try and match which what was brought up before and why the last Judge ruled that we were to hurry up and get on with it. SD were stalling as they had no intention of matching. Elite have not been involved for a year yet as it was October before we started selling kit with them.

Finally Hummel deal is as kit supplier. It has nothing to do with retail or replica kit that is where Elite is involved and is totally separate. Hummel sponsor our jersey if SD want to supply our replica kit then they have to try and deal with Hummel and get them to give them stock. Hummel/Elite at worst case will not be allowed to sell replica jerseys only fat man.

Mate. You need to read the ruling. Basically none of this is the case.

 

[Bluenose1979]

I think this also assumes that sports direct won’t eventually walk away if this will be the constantly trodden path. Again i would say we will always be the defendants here so have no choice but they will have to keep going on that merry go round - it is damaging everyone’s reputation and the courts are getting extremely fed up. That much is clear from the language the judge uses this time round.

Yeah, there’s nothing to suggest SD will walk away. Quite the opposite.

 

[Marty101]

My reading of Para 92 is that the judge is accepting that the cap is not sufficient and that is offset by entitling them to the revenues they would've got from matching the first two seasons of the Hummel deal. IE the money they will be due for that is what is making up for the insufficient cap of £1m - and it is not classed as damages.

I think that’s more nor less how Jas Boyd is reading it too, but the judge is saying that all in the context of deciding to grant the injunction (paras 90 to 95 are all under the heading injunctive relief.)

The judgment as a whole is dealing with declaratory relief (which is really telling the parties what the contract says and what their obligations are under it, since they were in dispute about that), and the question of whether the injunction should be granted.

Para 92 is part of his consideration as to whether injunctive relief is justified, and he sees it as so due to the cap on the damages. He’s just saying you can’t fix this with damages, so you’re entitled to the enforcement of your matching rights by virtue of the injunctions sought.

My view is that the loss of profit suffered by SDIR has to be part of their damages claim; I don’t see it as a separate head of claim. Loss of profit on breach of contract is the “classic” sort of damages someone can claim for a commercial contract. (I also think if the conclusion was that the loss of profit was something other than damages, there would be a lot more discussion and explanation of what sort of remedy the loss of profit would be.)

There isn’t any general rule that just because a party’s losses would greatly exceed a cap on damages that the cap can be put to one side if there’s a breach of contract. That’s just the risk the party took when it agreed the terms of the contract.

The argument is usually more that the wording of a clause imposing a cap like that can be scrutinised very carefully by a court to see if it stands up to interpretation and analysis. There’s no sense of the judge going through that sort of process here. It might happen in a later hearing though.

I also think the summary in the conclusions would state clearly that the judge considered a payment for 18/19 and 19/20 had to be made, if that was his decision.

 

[Square and compass]

This and the pedro debacle has cost the club maybe 20 million pounds.
Heads should roll, there are people to blame and they should be no where near the club.

 

[ecossebear]

Who is Jas Boyd?

Pretty dependable poster on twitter who’s usually spot on. Definitely one of us and I usually follow his judgement on things.

 

[ecossebear]

At the end of the day no point debating what may happen regarding the losses cap. It will come down to interpretation by a judge at a date and no one on here can guess what that may be. Yes this seams like a clusterf*** by the board, but I can’t believe for one minute they didn’t do what they felt was the best for the club at the time and everyone can make a bad judgement - this looks like theirs. At the end of the day if they have messed up as badly as it looks, it is them that are out of pocket since they are the ones bankrolling is. We perhaps need to remember that before attacking them.

 

[MosesMcNeil99]

Yeah, there’s nothing to suggest SD will walk away. Quite the opposite.

I think that’s fair enough mate - there’s probably enough circumstantial evidence to back both of our views on this but again this is purely speculative.

The main point that I think most people are concerned with in the short to medium term is do we owe Ashley ‘millions’. I think based on the facts ie what the judge has laid out that is absolutely not true and is lazy journalism from the usual rags.

 

[Laudrup11Cooper]

It’s the opposite of a gamble if you expect to lose and take the hit, where the hit is the lesser evil.

No offense ……but do you know this for a fact?

 

[ElBarrileteCosmico]

You’re not wrong
How many sat on their hands when we were nearly sent to oblivion?
We like to call ourselves the best support in the world, that’s simply back patting, we aren’t, we aren’t even near it. We are lazy

There’s an inherent life belief in a lot of our support that big powerful men are good and should look after us. Check the lounge out ffs...

There was support for every spiv that rolled up. It’s deeply ingrained in so many that rich people are good and can be a father figure. That’s led us to where we are.

 

[Glasgow Ger]

Unfortunately for Elite, if the judge rules that we broke the contract, we will have to say cheery bye as we will be contractually obliged to go with SDI.

However I believe Elite would of been well aware when they agreed to work with us that if worse came to worse then this situation was a possibility.

What they do next I’m not sure. Do they gracefully accept this was a possibility? Do they sue Rangers for loss of profit as their contract isn't fulfilled? who knows.

But as you say, if we go with SDI, then we’ll probably need to find a new manufacturer as Hummel/Elite have some sort of tie in.

Worrying thing for Elite is that they took out a 10 year lease on the shop at St Enoch. If I were elite and I was told that I wasn’t allowed to sell any more merchandise then I’d definitely be suing Rangers. That being said I don’t know what involvement if any Rangers had in dealing with Elite.

 

[MosesMcNeil99]

No offense ……but do you know this for a fact?

The only people that know for a fact are Dave king and his legal team/directors.

However I find it highly highly unlikely that rangers did not expect this. when weighing it up, everything that comes with selling our kit (exposure, profit, fan satisfaction etc) would massively offset the pain and cost of this battle with Ashley, plus the fact that damages are capped at a million.

There’s just no way everything hinged on the court ruling in our favour on this. It was never likely to win.

 

[BrownBrogues]

Pretty sure if we're forced back into a deal with SD, Hummel won't be manufacturing our kit and we'll be back in cheap Puma garb.

Pretty sure this is covered in the Judgement that control over this aspect reverted to Rangers under the end of the 7 year agreement. SD can only use the trademarks to produce non kit merchandise.

Time to shelve this thread, a lot of misunderstanding putting false fear in folk. I know it’s not deliberate but, let the court aspect run its course.

 

[Marty101]

I think the real worry is what sort of damages claim Elite/Hummel might have against us.

Thinking about that further, there is a possibility of a claim by SDI against Elite/Hummel for damages for inducing a breach of contract. The authorities in relation to that suggest that such a claim might not be capped even if the contract they induced a breach of itself contains a cap on damages.

We’ve indemnified Elite, so they would pass such an uncapped claim on to us, presumably. I’m a long way from thinking SDI necessarily could go against Elite/Hummel for inducing a breach of contract, as if they had a reasonable belief that what they were doing was not facilitating a breach (even if they were wrong about that), then they would have a defence.

If SDI did successfully pursue them this way though, that might get them round the cap by the back door, since we could then end up carrying an uncapped claim under the indemnity.

 

[LarkfiedLoyalNS]

Wish I never opened this thread.

Depressing.

 

[Burgh Bear]

From what I can gather, a boycott would just be cutting our nose to spite our face.

IF we are forced to deal with SDI again, then it will only be on the grounds that they match the offer that Elite put forward. Now if the deal from Eltie is beneificial to Rangers, then SDI marching said deal will also be beneficial to Rangers.

Yes Elite will be making a cut, which will then become SDI’s cut should we be forced to work with them, however..

We have been saying for years how all the diddy teams hate us more than they love their own team.. prime example from least season being Killie reducing our allocation, thus giving us 2 fingers, but dramatically reducing their own income in the process.

If we boycott SDI, when the deal is favourable to Rangers, then we would essentially be giving 2 fingers to Ashley, but also reducing our own income in the process!

Therefore if SDI take on the contract we should bite the bullet, and continue to buy, knowing SDI make a cut, but also knowing that Rangers are making a decent profit too.

This is just my opinion based on what I can gather from the contract/courts situation. And IMO we should have allowed SDI to match the Elite deal initially, as we wouldn’t have made any more or less money, only difference would have been SDI taking a cut as opposed to Elite. That was a major OG on our part but I suppose at the time we believed, through legal advice or whatever, that we had the right to accept Elites offer without letting SDI match it. Which the court have now ruled we didn’t have the right. So actually the club accepting elites offer and refusing to work with SDI, has potentially cost us more, than if we had allowed them to match the offer and agreed to sell through them.

Got to agree mate

 

[BrunoBear]

There’s an inherent life belief in a lot of our support that big powerful men are good and should look after us. Check the lounge out ffs...

There was support for every spiv that rolled up. It’s deeply ingrained in so many that rich people are good and can be a father figure. That’s led us to where we are.

I actually think the poets would have started burning shit down ages ago.

 

[Spinning Blue]

This is all a fucking mess.

 

[TerrySilverLoyal]

The whole thing is a fucking shambles

 

[Tagsbear]

Pretty dependable poster on twitter who’s usually spot on. Definitely one of us and I usually follow his judgement on things.

He also is a long term critic of Dave King, for whatever reason, and whilst he's a switched on guy I think that clouds his judgement at times.

 

[supersonic]

Worrying thing for Elite is that they took out a 10 year lease on the shop at St Enoch. If I were elite and I was told that I wasn’t allowed to sell any more merchandise then I’d definitely be suing Rangers. That being said I don’t know what involvement if any Rangers had in dealing with Elite.

I agree with what your saying and dont get the 10 year lease or the pop up shop (considering elite executives were part of this trial they would know well before us the outcome, yet the pop up shop went ahead). If we only signed a 3 year deal with elite and hummel then why would they take a lease of 10 years? Elite defos knew the risk of all this before surely.

 

[Burgh-Ger]

I have to ask - I appreciate the SD contracts were shocking and we all want them away from the club but if we were obliged to offer them the ability to match the deal on the table then why didn’t we do it?

History tells us they will litigate!

Whether it’s legal advise or brains within the club, this would appear to be an absolute cluster fu*k

 

[Now and forever]

How do you know this?

It's in the judgement Elite were indemnified.

 

[Earl of Leven]

There is no fucking way anyone is stupid enough to believe we can break legal contract every season, make £4m for example, and just give SDI £1m.

Don't you think the courts will have thought of this?

 

[Valley Bluenose]

Jas Boyd's take

https://www.twitlonger.com/show/n_1sqv59s

I'd be interested to hear from @Marty101 on Jas's take of the damages.

Got a lot of time for Jas' work but he demeans his article by bringing Club1872 into his diatribe about Blair. I don't disagree with him that Blair has had undue influence in guiding the Club's legal challenge to SDI -the Judge says as much - but that's nothing to do with Club1872 and the article would have been no weaker had he omitted mention of them. He's allowing what appears to be a personal beef about Blair's involvement with Club1972 to infringe on an article that has nothing to do with Club1872. Blair's supposed 'conflict of interest' with Club 1872 has nothing at all to do with his involvement in the SDI case.

 

[supersonic]

I have to ask - I appreciate the SD contracts were shocking and we all want them away from the club but if we were obliged to offer them the ability to match the deal on the table then why didn’t we do it?

History tells us they will litigate!

Whether it’s legal advise or brains within the club, this would appear to be an absolute cluster fu*k

It looks as if they were already talking to elite and hummel so much that they intended to go into business with each other, it wasnt w normal tendering process. Stupid move.

 

[supersonic]

Got a lot of time for Jas' work but he demeans his article by bringing Club1872 into his diatribe about Blair. I don't disagree with him that Blair has had undue influence in guiding the Club's legal challenge to SDI -the Judge says as much - but that's nothing to do with Club1872 and the article would have been no weaker had he omitted mention of them. He's allowing what appears to be a personal beef about Blair's involvement with Club1972 to infringe on an article that has nothing to do with Club1872. Blair's supposed 'conflict of interest' with Club 1872 has nothing at all to do with his involvement in the SDI case.

It's a good point though. Club 1872 is pretty dormant and puts out the odd statement whilst it takes in the cash and occasionally buys shares. What is actually happening? Who are the elected members?

 

[CinnamonSwally]

I’m clueless with all this sort of thing so apologies for the noob question.

So there doesn’t come a time when SD will no longer be able to match deals from other companies?

 

[alex wright]

I’m clueless with all this sort of thing so apologies for the noob question.

So there doesn’t come a time when SD will no longer be able to match deals from other companies?

As soon as they refuse to match a legitimate offer their right to match ends.

 

[Valley Bluenose]

I think the real worry is what sort of damages claim Elite/Hummel might have against us.

Thinking about that further, there is a possibility of a claim by SDI against Elite/Hummel for damages for inducing a breach of contract. The authorities in relation to that suggest that such a claim might not be capped even if the contract they induced a breach of itself contains a cap on damages.

We’ve indemnified Elite, so they would pass such an uncapped claim on to us, presumably. I’m a long way from thinking SDI necessarily could go against Elite/Hummel for inducing a breach of contract, as if they had a reasonable belief that what they were doing was not facilitating a breach (even if they were wrong about that), then they would have a defence.

If SDI did successfully pursue them this way though, that might get them round the cap by the back door, since we could then end up carrying an uncapped claim under the indemnity.

I've been away visiting my son over the weekend so have only been dipping in and out of this.

@Marty101 is it fair to say that a summation of your thoughts would be as follows:

We will have to make recompense to SDI for 'lost profits' for last season and the one just started. That recompense could run into, to use the Judge's words, 'many millions of pounds'.

We may also face being sued by Elite/Hummel at some point. If Elite/Hummel sue we could be bound to pay them a huge sum of cash as well.

It may be, of course, that Elite/Hummel choose not to sue - but, they too, may be open to being sued by SDI and that may force their arm regarding suing us.

SDI have had an injunction granted preventing the launch of the Away and Third kits (subject to any Appeal by Rangers).

We have been bound by this judgement to return to SDI for our retail operations from next Summer (or have they only been given the right to match again?)

Please tell me I've called each and every one of those wrongly mate.

F*cking grim.

 

[Anoldranger]

This and the pedro debacle has cost the club maybe 20 million pounds.
Heads should roll, there are people to blame and they should be no where near the club.

Please name the ones responsible

 

[Valley Bluenose]

It's a good point though. Club 1872 is pretty dormant and puts out the odd statement whilst it takes in the cash and occasionally buys shares. What is actually happening? Who are the elected members?

It's not a good point at all. It is entirely irrelevant in the context of the case against SDI.

By all means raise it as a discussion point regarding Club 1872 - but that's an entirely separate issue to this matter. Just smacks of throwing it into the article because he has a personal beef about it.

 

[Bluenose1979]

I think that’s more nor less how Jas Boyd is reading it too, but the judge is saying that all in the context of deciding to grant the injunction (paras 90 to 95 are all under the heading injunctive relief.)

The judgment as a whole is dealing with declaratory relief (which is really telling the parties what the contract says and what their obligations are under it, since they were in dispute about that), and the question of whether the injunction should be granted.

Para 92 is part of his consideration as to whether injunctive relief is justified, and he sees it as so due to the cap on the damages. He’s just saying you can’t fix this with damages, so you’re entitled to the enforcement of your matching rights by virtue of the injunctions sought.

My view is that the loss of profit suffered by SDIR has to be part of their damages claim; I don’t see it as a separate head of claim. Loss of profit on breach of contract is the “classic” sort of damages someone can claim for a commercial contract. (I also think if the conclusion was that the loss of profit was something other than damages, there would be a lot more discussion and explanation of what sort of remedy the loss of profit would be.)

There isn’t any general rule that just because a party’s losses would greatly exceed a cap on damages that the cap can be put to one side if there’s a breach of contract. That’s just the risk the party took when it agreed the terms of the contract.

The argument is usually more that the wording of a clause imposing a cap like that can be scrutinised very carefully by a court to see if it stands up to interpretation and analysis. There’s no sense of the judge going through that sort of process here. It might happen in a later hearing though.

I also think the summary in the conclusions would state clearly that the judge considered a payment for 18/19 and 19/20 had to be made, if that was his decision.

Fair assessment. Still to be decided exactly what will be awarded to compensate the slug. I would maintain that I don’t see any indication that he won’t do well out of it and we will remain tied to SDI though.

 

[Marty101]

I've been away visiting my son over the weekend so have only been dipping in and out of this.

@Marty101 is it fair to say that a summation of your thoughts would be as follows:

We will have to make recompense to SDI for 'lost profits' for last season and the one just started. That recompense could run into, to use the Judge's words, 'many millions of pounds'.

We may also face being sued by Elite/Hummel at some point. If Elite/Hummel sue we could be bound to pay them a huge sum of cash as well.

It may be, of course, that Elite/Hummel choose not to sue - but, they too, may be open to being sued by SDI and that may force their arm regarding suing us.

SDI have had an injunction granted preventing the launch of the Away and Third kits (subject to any Appeal by Rangers).

We have been bound by this judgement to return to SDI for our retail operations from next Summer (or have they only been given the right to match again?)

Please tell me I've called each and every one of those wrongly mate.

F*cking grim.

I think you’re correct on each point, although I think the money we might have to pay SDI directly for loss of profit for last season and this is probably capped at £1m.

 

[Laudrup11Cooper]

The only people that know for a fact are Dave king and his legal team/directors.

However I find it highly highly unlikely that rangers did not expect this. when weighing it up, everything that comes with selling our kit (exposure, profit, fan satisfaction etc) would massively offset the pain and cost of this battle with Ashley, plus the fact that damages are capped at a million.

There’s just no way everything hinged on the court ruling in our favour on this. It was never likely to win.

Mate …I hope you are right.
I would never underestimate Ashley because I think this has gone beyond business.It’s a personal battle between King and Ashley.
And unfortunately as of now there is only one winner and it’s not King!

 

[Valley Bluenose]

I think you’re correct on each point, although I think the money we might have to pay SDI directly for loss of profit for last season and this is probably capped at £1m.

Thanks - I think. Every bit as bad as I suspected from my 'speed read' then. That said, if the cap applies it helps - at least in respect of SDI, if not Elite/Hummel should it come to that.

Just got back home. I'm away for a couple of beers and a lie down to see if I can shake off these suicidal feelings.

 

[Eddie Doc]

I’m clueless with all this sort of thing so apologies for the noob question.

So there doesn’t come a time when SD will no longer be able to match deals from other companies?

They've got the right to match in perpetuity. (For ever)

 

[Now and forever]

Fair enough - they would also need to invoke it though. Doubt rangers were ever confident of winning this to be honest but the trade off of having our kit out there and some profit was far better and damages to SDI are ultimately limited.

Elite and Hummel would be well aware of this - I would be very surprised if we end up in court with those parties. This is in no way a surprise.

Have you actually read the judgement?

Burying your head in the sand isn't going to make it better.

There's a reason companies insist on being idemnified.

 

[Vote For Pedro]

I’ve read bits of the judgment and some on here. However I might not be getting this or just a bit thick, but if it’s been ruled that SD had the right to offer terms or match the deal we have would we have been obliged to accept those matched terms? Would our defence not have been SD can offer what they like, we won’t be doing business with them? Fucking pisses me off this stems back to that cvnt Green taking us for everything!

 

[HenningBerg]

They've got the right to match in perpetuity. (For ever)

Illegal under European law .

 

[Bristol_bnose3]

How much longer does the deal with sdi have left to run?

 

[Chubster]

Worrying thing for Elite is that they took out a 10 year lease on the shop at St Enoch. If I were elite and I was told that I wasn’t allowed to sell any more merchandise then I’d definitely be suing Rangers. That being said I don’t know what involvement if any Rangers had in dealing with Elite.

A 10 year lease ?? I find that very unlikely.

 

[ronadamus_prime]

Illegal under European law .

Why have we not taken this to the European courts?

I'm stupid and don't understand the ins and outs. So just wondering if that's even a possibility.

 

[HenningBerg]

How much longer does the deal with sdi have left to run?

This is getting borderline ridiculous , not aimed at you pal because we all have the same questions and concerns.

Where are the board or club 1872 to show a bit of guidance ? Surely we will hear something tonight or tomorrow . We can’t be left in the dark again on this .

 

[Marty101]

Illegal under European law .

Seen this mentioned a few times on here - can someone point to The provision which says this? Is it some part of competition law?

Not disputing it, I just haven’t heard of it and would like to check.

I can see a contract for an indefinite period might be barred - I do wonder if a contract for defined periods which can be indefinitely renewed would be.

 

[kclarkhall]

A 10 year lease ?? I find that very unlikely.

They did.

 

[Candyass]

Dave King's tenure as Rangers chairman will be judged heavily on how he dealt with Ashley & Sports Direct.

With all due respect, the fat cůnt has tied King in knots.

The only plausible explanation is that either we knew we were screwed from the beginning & this was all stalling for time, or our board are as inept as they come.

I'm hoping it's the former, but someone in the board room has made an absolute dog's dinner of this.