GB - The Football League Ltd v Edge Ellison (a firm)

Judgment

MR JUSTICE RIMER :

Introduction

1. The Football League Limited (“the FLL”) administers the business and furthers the interests of the 72 member clubs which make up the Football League and constitute its shareholders. It organises an annual league of what were formerly known as (and I will call) the First, Second and Third Divisions but now as the Coca Cola Championship, League One and League Two.

2. The FLL owns the broadcasting rights to matches played by its member clubs. In 1995 it licensed the television rights to British Sky Broadcasting Limited (“Sky”) for five years. During the term of that licence, the clubs concluded that a better deal could and should have been done. With a view to doing better in future, the FLL established a Commercial Committee whose function included the negotiation of licences of media rights on the best terms.

3. On 15 June 2000, following an extended marketing exercise by the Commercial Committee, the FLL granted a licence of the television rights to ONdigital Plc (“ONdigital”) for a term of three years from the beginning of the 2001/02 season (when the Sky licence would expire). The total amount payable by ONdigital over the term was £315m, including an advance payment of £47.25m, to be paid as to £12m on 15 June 2000 and as to the balance of £35.25m within 80 days. The advance payment was particularly attractive, since the clubs were in urgent need of money, with some facing risks of insolvency. ONdigital was ITV’s digital broadcasting arm and was a subsidiary of Carlton Communications Plc (“Carlton”) and Granada Media Plc (“Granada”), both FTSE 100 companies.

4. In March 2002, with over two years of the licence term still to run, ONdigital went into administration. It stopped broadcasting on 1 May 2002. It went into liquidation in October 2002. A substantial part of the £315m was unpaid and the FLL could at most hope for a modest dividend in the liquidation: its claim in the Commercial Court for a declaration that each of Carlton and Granada was a guarantor of ONdigital’s liabilities was dismissed by Langley J in August 2002 ( Carlton Communications plc and Another v. The Football League [2002] EWHC (Comm.) 1650 ). I shall refer to that claim as “the guarantee action.”

5. The FLL has now brought this claim against edge ellison. They are the solicitors who acted for it on the licensing of the rights to ONdigital (the firm later merged with Hammond Suddards, now Hammonds). The partner handling the m

Judgment

MR JUSTICE RIMER :

Introduction

The Football League Ltd v Edge Ellison (a firm)

Areas of Law