Sports Ticker (15 February 2022) - Sony acquires Bungie, LaLiga launch Amazon store and BT, Eurosport in JV negotiations - a speed-read of commercial updates from the sports world
In a fortnight which has seen the settlement of the passing off claim against the House of Rugby podcast (see Edition 54), the Washington Redskins' rebranding coming into effect as they become the Washington Commanders, and the CAS's decision to allow Kamila Valieva to continue competing in the Winter Olympic Games, we feature an update on BT's ongoing negotiations with Discovery around a potential joint venture with Eurosport UK, LaLiga's official Amazon store launch and Sony's acquisition of Bungie.
We also take a look at the recent High Court decision considering a force majeure clause in a media rights agreement involving European rugby (EPCR), potential breaches of the Premier League and UEFA's IP rights by the "Ape Kids Club" NFT creators, and Chelsea FC's settlement of a High Court claim over historical racist abuse allegations.
As always, if there are any issues on which you'd like more information (or if you have any questions or feedback), please do let us know or get in touch with your usual contact at RPC.
The Commercial Court handed down judgment on a dispute between European Professional Club Rugby (EPCR) and RDA Television (RDA), in which EPCR licensed its media rights in the Champions Cup and the Challenge Cup to RDA. Following suspension in March 2020 of the knock-out matches of the two tournaments due to the COVID-19 pandemic, RDA terminated the media rights agreement – stating its reliance on the relevant force majeure clause. EPCR brought a claim in the Commercial Court and, after a trial in early December, the Court found largely against EPCR on the main claims in a Judgment handed down a couple of weeks ago. EPCR claimed damages for wrongful termination of the agreement by RDA. RDA successfully counterclaimed against EPCR claiming back the pre-payments made for the 2020/21 and 2021/22 seasons. In siding with RDA, amongst other things, the Court rejected the argument from EPCR that – because both parties had been affected by the same Force Majeure event (i.e. COVID-19) – RDA should be prevented from relying on the Force Majeure clause. After the Premier League's successful claim against PPL, this is the second High Court decision on COVID-19-related terminations of media rights agreements in recent months.
Sony has announced its strategy to expand its offering of “live service” games, with 10 new multiplayer games planned for its PlayStation 5 console by 2026. This represents a shift for Sony, which has previously focused on single player narrative games. The market for live service games, such as Fortnite and Apex Legends, has grown by 15% year on year since 2014, creating new income streams for developers from in-app purchases rather than from traditional upfront sales. Sony’s new announcement follows its acquisition of Bungie, the video game developer behind popular titles Halo and live service game Destiny 2, in January for $3.6bn. Although Bungie will remain an independent studio, it is predicted that the company will play a large part in developing Sony’s new live service titles.
Premier League, UEFA investigate NFT IP rights breaches
The Premier League and UEFA are investigating potential breaches of their intellectual property rights by a collection of NFTs named the 'Ape Kids Club'. The 10,000-strong collection, a spin-off of the popular 'Bored Ape Yacht Club', includes drawings of trophies, logos and kits linked to entities such as the Premier League, UEFA Champions League, the FA and Chelsea FC. Amongst those promoting the collection on social media are former Premier League players Jack Wilshere and Bobby Zamora – as well as former Chelsea captain John Terry (who despite promoting the collection online, is also currently a coach at the club).
BT Discovery continue joint venture negotiations
Following our update in Edition 52, BT has announced that it is in negotiations to form a 50:50 joint venture with Eurosport UK, which is owned by the US Discovery group. The deal would give BT Sport customers access to Eurosport content including tennis Grand Slams and Olympics-content, in addition to Premier League and UEFA Champions League matches and other major sporting events. The wide offering would make the new service a strong competitor to Sky Sports in the UK. BT and Discovery aim to complete the deal by Spring 2022, with the service being operational later this year subject to regulatory approval. BT had previously been in talks with streaming service DAZN, which sought to acquire the BT Sport network for an estimated US$800 million.
LaLiga has launched an official store on Amazon, becoming the first football league to have its own dedicated ecommerce portal with the online retail giant. The ecommerce platform features kits and other merchandise from 13 Spanish top-flight clubs, but notably Real Madrid, Barcelona and Atletico Madrid are absent from the list of participating clubs selling products via LaLiga's Amazon online store. LaLiga is following suit of other sports teams, clubs and associations recognising the value and importance of fan engagement through tapping into digital technology and ecommerce.
... and finally, Chelsea FC have settled a High Court claim for an undisclosed six figure sum over historical allegations of racist abuse, brought by four former members of the club's youth team. The alleged conduct took place in the 1990s, when the claimants were between the ages of 14 and 18, and was allegedly perpetrated by then members of the youth team coaching staff. Both parties reported they were pleased to have reached the settlement (which was reached ahead of a pre-trial review), with the Chelsea spokesman indicating that the club's Player Support Service continues to support former players.