Wednesday, October 08, 2014

ASADA Act amendments - what the changes mean for sport in Australia

The Australian Sports Anti-Doping Authority Amendment Bill 2014 (Bill) was recently referred to the Senate Community Affairs Legislation Committee for inquiry and report.

The Bill proposes five amendments to the current Australian Sports Anti-Doping Authority Act 2006 (Cth) (Act) which are all scheduled to come into effect on 1 January 2015.

Violations List

The current "Register of Findings" will be replaced by a "Violations List". The new Violations List will detail all athletes or support persons whose sanction for an Anti-Doping Rule Violation (Violation) has been finalised. This amendment aims to simplify the process of charging and sanctioning an athlete or support person for a Violation.

Under the current system, ASADA issues its show-cause notice to the athlete or support person, and thereafter the Anti-Doping Rule Violation Panel determines whether to place the person's details onto the Register of Findings. If so, ASADA informs the person's sport, and the person is then charged under the terms of the sport's anti-doping policy. This two-stage process is unique to Australia. It has long been considered antiquated and "clunky" in operation, and has resulted in matters in Australia taking a comparatively long time to process as compared to other countries.

The proposed new process is intended to streamline the steps involved. Once an athlete or support person has been charged, a hearing conducted and the person has been sanctioned by their relevant sport, ASADA will list the nature of the doping offence and the resulting sanction on the (publicly available) Violations List. Such an approach will finally align the anti-doping process in Australia with that of the rest of the world.

Prohibited Association

The Bill creates a new Violation of prohibited association, in which it will be a Violation for an athlete or support person to associate, in a professional or sports related capacity, with another person who is banned from sport or has been criminally convicted or professionally disciplined for an action that would constitute a Violation.

By way of example, it will be considered a Violation for an athlete to be trained by a coach who is currently serving a sanction. The proposed wording is very broad and, therefore, it may also be considered a Violation for an athlete to be trained by a coach who is not serving a Violation sanction, but who has been professionally disciplined for an action that would constitute a Violation. For example, a coach who is also a teacher, lawyer, doctor or other industry professional, and who has been disciplined for recreational drug use by their industry body.

The amendment has the potential to be wide-reaching in its application across sports, and will require sports to be thorough in their recruiting and appointments. The prohibition on association only applies in a sporting or professional capacity and is not intended to prevent social or family associations with a banned person.

Other amendments

Other amendments proposed by the Bill include:

Increasing the limitation period (ie the period in which a charge must be brought) for actions in relation to potential Violations from eight years to ten years.


Creating a right of appeal within Australia for athletes who are denied access to medication under a Therapeutic Use Exemption (TUE). Where an athlete's application to have medication approved under the TUE is unsuccessful, they will now have the opportunity to seek consideration of the decision by a review panel, rather than having to appeal directly to WADA.


It will be an offence, with a maximum of two years' imprisonment, to disclose protected information to anyone besides an authorised person for the purposes of the ASADA Act. While there are currently provisions under the ASADA Act relating to disclosure of confidential information, the amendments seek to simplify these rules.

Overall, the measures introduced in the Bill will simplify and streamline the anti-doping process in Australia. In particular, the introduction of the Violations List and the TUE review panel will assist both athletes and sports and are long overdue changes.

The introduction to the WADA Code of the new violation for "prohibited association" and the lack of information surrounding its operation in practice, may create a few challenges for ASADA and is likely to result in some court challenges in order to get clarity on this new violation.

However, the amendments have not addressed some of the major concerns that sport has in Australia such as:

the requirement for matters to be heard by CAS at first instance (in most cases) and the associated costs of such hearings, where other jurisdictions such as the UK, the USA, France, Canada and New Zealand have no-cost tribunals available to their sports and athletes; and

those issues pertaining to professional team sports which face a different set of challenges from individual sports.

It will be interesting to see if the Senate Community Affairs Legislation Committee makes any recommendations on the matters outlined above in its review of the Bill.

 

Amelia Lynch
Senior Associate
Tom Hickey
Graduate
alynch@landers.com.au

 

This article originally appeared on the Lander & Rogers internet site. You can access the original by clicking here. A search for ASADA on the World Sports Law Report internet site returned eight articles. To sign up for a free trial to World Sports Law Report, click here.


Tuesday, September 23, 2014

Major bookies agree self-regulation to promote responsible gambling

The recent announcement by the four major retail bookmakers – William Hill, Ladbrokes, Coral and Paddy Power – that they are committing to a range of voluntary measures to promote responsible gambling standards and ensure that the marketing of gambling is socially responsible, has been well received by the national regulator, the Gambling Commission, and politicians alike.

The proposals

Together these four operators have formed an organisation called the Senet Group, and whilst the founding members are all bookmakers, the organisation is open to all gambling operators.

The response by the betting industry to address very public concerns around gambling sees a commitment to the following steps from the 1st October 2014:

• a voluntary ban on advertising sign-up offers (free bets and free money) on TV before 9pm, mindful of children and young people watching;

• the withdrawal of all advertising of gaming machines from betting shop windows;

• dedicating 20% of shop window advertising to responsible gambling messages.

These measures follow a further initiative taken by the industry in September 2013 when the ABB's Code for ‘Responsible Gambling and Player Protection in Licensed Betting Offices’ was launched.

In addition to the above, from 1 January 2015, a commitment has been made to:

• the creation of a new independent body, The Senet Group, which will be headed by an independent Standards Commissioner to hold the industry to account;

• fund a major new advertising campaign to educate people about responsible gambling;

• all TV advertising carrying more prominent responsible gambling messages.

In launching these initiatives Richard Glynn, CEO of Ladbrokes said that whilst "Gambling has long been a leisure pursuit and part of the cultural fabric of the UK…we are alive to the concerns of the public to keep gambling a responsible and fun activity.”

Patrick Kennedy, CEO of Paddy Power also commented that "Putting responsible gambling at the heart of our business is simply the right thing to do.”

The Public Response

The Gambling Commission has welcomed the initiative adding that they "hope it will gain traction across the industry more widely" whilst Helen Grant MP tweeted that she was ‘encouraged by leading bookmakers announcement …on social responsible gambling’ adding that she was ‘pleased with the industry's pro – activity’.

Needless to say the proposals did not receive universal praise. The Campaign for Fairer Gambling is reported as saying that "the bookmakers are engaging in desperate conjuring tricks to protect their FOBT market monopoly and, put simply, this is just more smoke and mirrors. If the Gambling Commission was fit for purpose there would not be the need for a watchdog. But for any such watchdog to have credibility it should be neither industry-run nor industry-funded."

This may seem a little harsh on an industry who no doubt feels that they are damned if they do and damned if they don’t. In practice, what does all of this mean? Is it too little too late from the industry and has the ‘FOBT’ horse already bolted? There are clearly those who will feel that the industry has not gone far enough and that the proposed measures are a token effort as the political pressure mounts on the sector.

What does this mean in practice?

Whichever side of the argument you find yourself on it is, however, progress and the betting industry should be applauded for the steps that they are going to take. The recent announcement, however, should not been seen as the end for any self-regulation. It should simply be regarded as a start. Any policy, whether they be in relation to responsible gambling or, for example, health and safety, needs to be dynamic, and the steps proposed by the major bookmakers need to be re-visited on a regular basis to keep in step with changing gambling habits and trends.

On a national level the Gambling Commission should have confidence that the words of the industry are now being translated in to actions. Whilst it remains to be seen whether the Senet Group will bear the teeth that it is ultimately given it should at least be given time to bed in before any sensible conclusions can be drawn.

In so far as the local regulators are concerned, when it comes to considering applications for premises licences, local authority licensing committees (and Boards in Scotland) should take greater comfort that those operators who have signed up to the above initiatives will not only comply with their statutory obligations under the Gambling Act 2005 (‘the Act’) but will be going over and beyond that which is required of them by statute to ensure that the objectives under the Act, and in particular the protection of children and the vulnerable, are being upheld.

These steps do not of course not stop an operator from proposing its own application specific conditions nor from preventing a local authority from adding its own additional conditions on any licence where there is evidence that to do so would be necessary to uphold and promote the licensing objectives under the Act.

The future

The argument over fobts, the debate over primary gambling activity, and the political pressure on betting operators will inevitably continue (there are outstanding consultations on the LCCP and planning regulations in England and Wales as well as Scotland). There has also been an announcement by a well-known operator of AGC premises that they intend to convert their premises from an AGC to a betting office and install four FOBTs.

The recent announcement will have taken some of the heat off the betting industry in the short term at least. Observers of the industry will watch closely to see what impact, if any, the proposed changes have and how the Senet Group holds, as they say they will, the industry to account.

 

Ewen Macgregor
Partner
Emma Feeney
Solicitor
Bond Dickinson, Bristol
ewen.macgregor@bonddickinson.com
emma.feeney@bonddickinson.com


This article originally appeared on the Bond Dickinson internet site. You can access the original by clicking here. A search on World Sports Law Report’s internet site for ‘gambling’ returned 70 articles. Try a trial to World Sports Law Report by clicking here.


NFL Could Learn From New MA Domestic Violence Law

 

Baltimore Ravens running back Ray Rice, Carolina Panthers Pro Bowl defensive end Greg Hardy, and San Francisco 49ers defensive end Ray MacDonald all have something in common (and it’s not just that they are incredibly talented professional football players):  They have all been indicted for engaging in conduct that constitutes domestic violence.  In Hardy’s case, he has been convicted for domestic abuse.  And just a few days ago, Minnesota Vikings running back Adrian Peterson was indicted for abusing his son and is now under investigation for abusing another son.

The National Football League’s travails with perpetrators of domestic violence have been numerous and storied, and after years of dealing with player domestic abuse instances, the NFL finally instituted a Domestic Violence Policy.  While the NFL’s policy is directed towards perpetrators of domestic violence, Massachusetts employers now are required to protect employee victims of domestic violence.

As of 1 September 2014, Massachusetts has joined 20 other states by enacting an Act Relative to Domestic Violence (‘DV Law’).  The DV Law requires employers to:

• Provide notice about the DV Law to all of its employees.

• Grant, and reinstate employees after, domestic violence leave.

• Not engage in discrimination or retaliation against any employee exercising his or her right to leave under the DV Law.  (Employers should also institute a protocol for employees to report possible violations of the DV Law and for investigating such reports.  The protocol may be similar to that used for reporting and investigating reports of sexual harassment in the workplace.)

• Keep confidential any information received in connection with an employee’s requesting or taking leave under the DV Law.

Below is a summary of some additional key terms.

When is the DV Law effective?

The DV Law became effective on 1 September 2014.

What employers are covered by the DV Law?

Employers with fifty (50) or more employees are subject to the DV Law.  As with many Massachusetts statutes affecting employee rights, the definition of employer is not limited to entities organized under the laws of, or having a place of business in, the Commonwealth.  Nor does it define employees protected by such law as those working in Massachusetts.

What employees are covered by the DV Law?

The DV Law protects any employee who:

• works for an employer with fifty (50) or more employees; and

• is, or has a family member who is, a victim of abusive behavior by a current or former spouse or person with whom there was a dating, engagement, cohabitation, or co-parental relationship. 

The employee need not be located in Massachusetts and does not need to have been employed for any period of time before being entitled to the protections of the DV Law.

To what is an eligible employee entitled?

An eligible employee may take up to fifteen (15) days of unpaid leave in a twelve (12) month period to:

• Seek or obtain medical attention, counseling, victim services or legal assistance;

• Secure housing;

• Obtain a protective order, appear in court proceedings, or meet with a district attorney or other law enforcement official;

• Attend a child custody hearing; or

• Address other issues directly relating to the abuse.

What notification or verification must an employee provide?

Where advance notice is available, employees are required to notify their employers as to when and for how long leave is needed.  Where an employee may be in imminent danger, advance notice is not required, but an employee must give her employer notice within three (3) workdays.  However, if an employee takes an unauthorized absence that is for a reason permitted under the DV Law, then her employer may not take any negative action against the employee if the employee provides verification within thirty (30) days from the last absence that the reason for the absence was one that is protected by the DV Law.

Although the DV Law does not require it, taking a page from the NFL’s playbook, it behooves employers, and particularly in-house counsel who must advise on how to handle employee situations that may be publicly damaging, to take this opportunity to consider a policy for handling employees who are perpetrators of domestic abuse (while being mindful of legal requirements related to the use of criminal records information).

 

Renee Inomata
Partner
Chair - Labor, Employment & Employee Benefits Practice
Burns & Levinson LLP
rinomata@burnslev.com

 

This article originally appeared on the Burns & Levinson blog ‘In-House Advisor.’ You can access the original article by clicking here.

 

 


Thursday, August 28, 2014

Fantasy Sports in Kansas May Be Illegal

As our readers are aware, the legality of fantasy sports contests is determined by two things:

• the laws of the individual States in which the participants are located; and

• the rules and features of the contests themselves.

In terms of Federal law, the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA) created a specific carve out for fantasy sports games that left the legality of fantasy sports up to the States. As we have detailed on this blog, some States have decided to allow its citizens to participate in fantasy sports contests, while others are silent on the topic or have outlawed such contests entirely. Kansas appears to have become the latest State to outlaw fantasy sports contests within its borders.

The Legality of Fantasy Sports Contests in Kansas

In a recent update to its website, the Kansas Racing and Gaming Commission (KRGC) states that ‘if a fantasy sports league involves the elements of (1) prize, (2) consideration and (3) chance, then it is an illegal “lottery” prohibited by Kansas criminal law.’

The first and second elements listed by the KRGC are pretty straightforward:

• a fantasy sports prize may consist of cash, gift certificates or tangible goods awarded to the fantasy sports contest winner(s); and

• consideration is a buy-in amount or fee paid by the player to participate in the fantasy sports contest. It is the element of chance outlined by the KRGC that has caused uncertainty in the fantasy sports industry.

Under Kansas law, the element of chance, as it relates to fantasy sports, is satisfied if it predominates over any skill involved. The KRGC acknowledges that some level of skill is required to be a successful fantasy sports player. It is whether that level of skill predominates over the amount of chance involved that has been the subject of significant legal wrangling. However, the KRGC has now definitively ruled that ‘chance predominates over skill in fantasy sports leagues.’ In short, under Kansas State law, if a fantasy sports league requires players to pay a fee to participate and awards a prize to the winner(s), in the opinion of the KRGC, it is an illegal lottery, punishable under Kansas criminal law.

This blog post only touches on a few of the relevant legal issues involved in the fantasy sports arena. If you plan on engaging in, or operating, a fantasy sports venture, be sure to retain competent legal counsel to help you design your associated contests in a way that comports with applicable law, and best protects you and your business.

 

David O. Klein
Managing Partner
Klein Moynihan Turco LLP, New York
dklein@kleinmoynihan.com

 

This article originally appeared on the Klein Moynihan blog. You can access the original by clicking here. A search on the World Sports Law Report internet site for ‘fantasy sports’ returned four results. To benefit from expert analysis on the key sports regulation issues of the day by proven experts, sign up for a free trial to World Sports Law Report by clicking here.


Wednesday, July 23, 2014

Proposed ban on sponsorship of major sports events by alcohol companies kicked to touch

The Republic of Ireland has recently decided not to implement a plan to improve public health by restricting the sponsorship of major sporting events by alcohol companies. Chris Connolly, an Associate with A&L Goodbody, explains the logic behind the proposed ban and why it was decided that it should not go ahead.
 

The much debated ban on sponsorship of major sporting events by alcohol companies will not form part of the government's upcoming legislation, known as the Public Health (Alcohol) Bill. Instead, the Bill will focus on introducing minimum pricing for strong alcohol products and warnings on promotional materials and containers.

The ban is now being considered by a governmental working group, which is expected to report on the issue towards the end of 2014. This follows an agreement at government level that no ban should be implemented until a decision is reached regarding how to secure alternative funding for sports bodies, who had claimed they would suffer a significant loss of income if the ban was implemented.

This issue has caused considerable debate since the National Substance Misuse Strategy Steering Group proposed the ban among 45 recommendations to tackle the issue of alcohol misuse in society in February of last year. The key aspects of the proposed ban were:

- A ban on new sponsorship contracts in respect of major sporting events being entered into between alcohol companies and sports governing bodies from 2016.

- An outright ban on such contracts from 2020.

- The ban would not apply to sponsorship of local events, only ‘major events.’

- The ban would not apply to arts and cultural events.

Views of sports governing bodies


In their submissions to the Oireachtas Committee on Transport and Communications, a number of governing bodies in sport stated that no evidence exists which proves that introducing a ban would help solve the problem of alcohol misuse in this country. They also pointed out that the introduction of a ban would result in a drastic drop in revenue for sports bodies, which would be in addition to the decrease caused by the economic downturn.

The Federation of Irish Sport, an umbrella organisation for over 100 sports governing bodies, asserted that the value of sport sponsorship by drink companies in Ireland in 2012 was €35 million and that if this entire sector of income was to be removed, there would be no alternative source of revenue available, either from the State or sponsors in other sectors. This would cause significant damage to sport at both elite and grassroots levels.

The Football Association of Ireland (FAI) has submitted that a ‘significant part’ of its annual sponsorship of income of €6 million would be lost. Likewise, the Irish Rugby Football Union (IRFU) had stated that a ban would cost it an estimated €9 million per annum.

This reduction in funding would jeopardise the ability of sports bodies to continue with social inclusion and community based projects that promote health and well-being. One such example is the FAI's Late Night League Programme, which takes place in disadvantaged areas during prime anti-social hours.

Views of the Drinks Industry Group of Ireland (DIGI)


The DIGI is the representative of the manufacturing, distribution and retail sectors of the drinks industry. It highlighted that a ban would be extremely damaging to one of the country's most vital industries. This would be at odds with the aim of growing Ireland's export industry using the food and drinks market.

It was also asserted that advances in technology, particularly digital television and video streaming, mean that on a daily basis consumers view content and advertising that originates from outside Ireland, for example the ability to watch foreign television channels and events such as the Heineken Cup in rugby union and the John Smith's Grand National in horse racing. Therefore, a ban applying only in Ireland would not eliminate consumers from exposure to sponsorship of major sports events by drink companies in other countries, where no such ban exists.

 

Chris Connolly
Associate
A&L Goodbody, Dublin
cconnolly@algoodbody.com


This article originally appeared on the A&L Goodbody internet site. You can access the original by clicking here. A search on the World Sports Law Report internet archive for ‘sponsorship’ turned up 216 articles. To access the archive, sign up for a free trial to World Sports Law Report by clicking here.


Tuesday, July 15, 2014

Suarez, Barcelona and Liverpool’s potential £70 million plus transfer profit

With Luis Suarez now reportedly close [n.b. - this article was written before his move was confirmed] to moving to Barcelona for a reported £70 million-£80 million, this blog aims to shed light on how clubs account for the sale and purchase of players and why it is important for Financial Fair Play (FFP) compliance. I have previously written on the value of the David Luiz transfer to PSG, which can be accessed here. Parts of that blog are republished here to explain the transfer amortisation accounting process.

How purchasing clubs account for their spending

In sexy accounting speak, 'when a player is purchased, his cost is capitalised on the balance sheet and is written-down (amortised) over the length of his contract.' In laymen’s terms, transfer fees for accounting purposes are spread over the length of a player's contract. If we take Barcelona’s proposed purchase of Suarez as an example, £75 million over a five year contract is amortised by a club in its accounts to the value of £15 million per season.

A transfer occurring in the summer after the 2013-14 season (depending on Barcelona’s accounting year-end) will have an impact on a club trying to break-even for FFP purposes in subsequent seasons. As noted above, Barcelona will amortise Suarez’s transfer fee over the length of his contract. If we assume a five year contract, Barcelona will have four further £15 million amortisation charges in their 15-16, 16-17, 17-18 and 18-19 accounts. All of those amortisation costs will have FFP significance.

How selling clubs account for their income

The other important amortisation issue is the accounting procedure when a player is sold. On this topic I defer to the Swiss Ramble, who uses the ex-Manchester City player Robinho as an example:

'[H]e was bought for £32.5 million in September 2008 on a four-year contract, so annual amortisation was £8.1 million. He was sold after two years, so cumulative amortisation was £16.2 million, leaving a value of £16.3m in the books. Sale price to Milan is reported as £18 million, so City will report a profit on sale of £1.7 million in the 2010/11 accounts. Therefore, City will show an annual profit improvement of £18.1 million after this deal: £8.3 million lower wages + £8.1 million lower amortisation + £1.7 million profit on sale.'

This demonstrates how clubs write off the transfer value of a player over the lifetime of their contract and also illuminates that because Robinho was worth £16.3 million two years into his four year deal, Manchester City actually made an accounting profit on his transfer of £1.7 million. Fans would see the sale of a player for £18 million bought two years previously for £32.5 million as bad business. The club in their accounts will class it as a £18.1 million profit improvement.

Potential Suarez profit for Liverpool

Liverpool originally purchased Suarez on a 5.5 year deal from Ajax in the January 2011 transfer window for a reported £22.8 million. Suarez’s transfer fee was amortised to around £4.1 million annually (£22.8 million / 5.5 years).

Suarez then signed a (presumed) new five year contract in August 2012. The remaining book value of the transfer fee at the time of his new deal was £16.65 million as around 1.5 years of the original transfer fee (£6.15 million) had been amortised. Therefore £16.65 million amortised over the new five year deal meant a new amortisation cost of £3.33 million per season.

Then in December 2013, he signed a new 4.5 year deal. Almost 1.5 years of his re-amortised total figure of £16.65 million had been amortised, which reduced his total unamortised value by £4.99 million (£3.33 million x 1.5 years) to £11.66 million. His annual amortisation cost became £2.57 million (£11.6 million / 4.5 years), or £214,000 per month.

If you are still with me(!), depending on the exact figures that Barcelona is willing to pay for Suarez, an initial conservative £70 million transfer fee minus the remaining £8.89 million (£11.6 million – £1.71 million), which is eight months further amortisation (£214,000 x eight months December ’13 to July ’14 inclusive), gives Liverpool a total accounting profit on the Suarez sale of £61.11 million. Therefore, with £10.4 million in lower wages1, £2.57 million lower amortisation costs and £61.11 million estimated profit on the sale, Liverpool may show an annual profit improvement of around £74 million.

Such profit will no doubt put Liverpool in a stronger position to spend big this summer, but as Liverpool’s year end is 31 May, transfer revenue from the Suarez deal will only appear in the clubs 2014-15 accounts thus not one of the periods (i.e. 11-12, 12-13 and 13-14) that UEFA will use to assess the club for FFP break-even purposes during the upcoming Champions League campaign.

 

Daniel Geey
Senior Associate
Field Fisher LLP
daniel.geey@fieldfisher.com

 

1. Assuming £200k a week, equaling around £10.4 million per year.

 

This article originally appeared on Daniel's blog, 'The Final Score on Football Law.' You can access the original by clicking here. A search for 'Financial Fair Play' in World Sports Law Report's internet archive returned 36 articles. To sign up for a free trial to World Sports Law Report, please click here.


Sunday, July 13, 2014

Doping tests and privacy rights in Spain: a key court decision

Spain’s Audienca Nactional has recently ruled that the Spanish High Council for Sports cannot require athletes to permanently report their whereabouts, despite concerns that such an extreme measure is necessary to fight against doping. Diego Ramos, a Partner in DLA Piper’s global media, sport and entertainment team, examines the decision and its implications.
 

No one can deny that, over the last decade, Spain has taken the fight against Sports’ doping networks very seriously. In 2006 and 2013, two demanding laws for the health protection of federated sportsmen and the prosecution of fraud in sports competition have been passed by the Spanish Parliament. New and stringent regulations developing both laws were rapidly drafted by the local Sports authorities. Enforcement of the laws and the regulations has been particularly tough. In fact a bit too much, as one Spanish court recently ruled.

The facts are simple. The Spanish High Council for Sports (CSD) issued a regulation requiring certain federated sportsmen (e.g. the ones recovering from injuries) to be available to undergo doping tests ‘permanently’. This meant at any time, workdays or weekends, holidays or working periods, day or night, in public or private life. They need to report where they are at all times (hence the term ‘permanently’). The Spanish Association of Professional Cyclists (ACP) filed a claim against that regulation for this and other legal grounds in front of Spanish Audiencia Nacional, a central court based in Madrid that handles serious crime like terrorism, the lawfulness checking of regulations and other matters like privacy rights.

The Audiencia Nacional, in a decision that has just been made public, dismissed most of the arguments of the claim, supporting strongly the views of CSD against doping. The Audiencia Nacional even ruled that, since doping in sports is a matter of public concern, sports professionals are obliged to accept regular doping tests at unusual periods of time. However, the Audiencia Nacional also found that the Regulation went too far when requiring some federated sportsmen to report ‘permanently’ where they are. They shall report where they can be ‘usually’ found for undergoing a test (the law actually employs the term ‘usually’, rather than ‘permanently’, the court says, so the CSD went too far extending the scope of the legal authorisation, especially when a constitutional right like privacy is at stake). The court could have stopped there. However, it went into detail on the merits of the case, analysing whether the duty to report ‘permanently’ the whereabouts of an individual breaches the constitutional right to privacy. It does, according to Audiencia Nacional. Every individual, also federated sportsmen, has the right to a minimum quality of life and a minimum of dignity. By making privacy zero that goal is not achieved.

The decision could still be appealed in front of the Spanish Supreme Court. Reporting where someone is ‘usually’ may be only slightly different from reporting where s/he is at every single second. However, the decision is important, and not only because it shall improve slightly the lives of Spanish federated sportsmen and sportswomen. First of all, the court that issued this decision handles normally the legal review of the decisions made by the Spanish Data Protection Commissioner. So it is likely to have a very strong impact on any future court decision on privacy in Spain. Second, the court used for deciding a sports’ case arguments borrowed from the Spanish data protection practice, the Spanish Data Protection Commissioner and the European Data Protection Authorities (Art 29 Working Party) in geo-localisation cases (i.a. AEPD reports of 28 June 2012 and 25 May 2009, AEPD Resolution of 6 June 2013, WP Art 29 Opinion of 16 May 2011). The special legal concept of ‘proportionality’ that made up the core of privacy authorities’ and experts’ position in all these instances is the one that also boasts the new court decision. People like policemen and sportsmen can be obliged, for different reasons, to be geo-localised on a regular basis. Personal safety, public security, personal health and sports’ cleanness entail risks that justify such burden. Nevertheless, forcing them to surrender their privacy at all times in all contexts is probably not proportional to those risks that the law tries to mitigate. A life that shall be worth living requires a minimum of dignity, and privacy is a key part of it.

Sources

- The Opinion of 16 May 2011 from the WP ex Art 29 can be checked here

- The resolution of the Spanish Data Protection Commissioner of 6 June 2013 (in Spanish) can be checked here

- The AEPD Report of 25 May 2009 (in Spanish) can be checked here

- The original draft of Spanish Law 3/2013 on protection of sportsmen’s health and fights agains doping in sports can be checked here


Diego Ramos
Partner
DLA Piper, Madrid
diego.ramos@dlapiper.com

 

This article was originally published on DLA Piper’s blog. You can access the original by clicking here.

A search for the term ‘privacy’ on World Sports Law Report’s internet site returned 70 results. A search for the term ‘data protection’ returned 45 results. World Sports Law Report’s internet archive contains over ten years of sports law information. For access, please contact sophie.rowlands@e-comlaw.com.

 


Friday, June 27, 2014

Court Confirms $1.6 Million Judgment Against Former Spartan and Detroit Red Wing Hockey Player

In a 17-page opinion issued on June 5, 2014, the Honorable Gordon J. Quist of the United States District Court for the Western District of Michigan entered an order recognizing a judgment entered in Switzerland against former NHL hockey player Kevin Miller. The case is of particular local interest in that Miller was born and raised in Lansing, played college hockey for Michigan State University, and played professional hockey for a number of teams, including the Detroit Red Wings.

The underlying judgment against Miller arose out of an on-ice incident on October 31, 2010, between Miller and Andrew McKim during a Swiss hockey league game. Miller checked McKim from behind, hitting McKim in the head and neck and causing McKim to fall on the ice and hit his head. McKim suffered a concussion and other injuries and was hospitalized for several weeks. The Swiss hockey league determined that Miller's check was intentional and suspended Miller for eight games.

In addition, McKim brought a civil lawsuit against Miller for injuries resulting from the incident. At the conclusion of the civil proceedings in Switzerland, judgment was ultimately entered in the amount of 1 million Swiss Francs against Miller, which, when converted to United States dollars, and adding interest, costs, and attorneys' fees, resulted in a current judgment amount of approximately US $1.6 million.

Miller challenged recognition of the judgment under the Uniform Foreign Country Money Judgments Recognition Act (FCMJRA), which Michigan has adopted. Miller raised two arguments:

- that the Swiss judgment was repugnant to public policy and violated due process because Miller was not allowed to cross-examine the independent expert who provided opinion testimony about Miller's intent at the time he checked McKim; and

- that it was repugnant to public policy and violated due process for the Swiss civil tribunal to consider as evidence the determination by the Swiss hockey league that Miller's check of McKim was intentional.

The district court was not persuaded that either of these objections rose to the level of the Swiss judgment being repugnant to public policy. The court noted that the fact that Swiss law does not allow for cross-examination of expert witnesses "is a mere difference of procedure that does not trigger the public policy exception." Op. at 11. The district court also noted that the civil tribunal's consideration of the hockey tribunal's disciplinary determination was not repugnant to Michigan public policy in that the hockey tribunal's determination was only one of numerous sources of information, and the "Swiss civil court did not accord preclusive effect to the National League proceeding that determined that Miller intentionally injured McKim." Id. at 12.

The district court also held that these concerns did not deny Miller due process in the Swiss civil proceedings. The district court clarified that foreign tribunals do not have to provide identical procedural safeguards as United States courts, but rather "must only be compatible in that they do not offend the notion of basic fairness." Id. at 14. Although the court acknowledged that the procedures in the Swiss tribunal were not identical to those in the United States, particularly the restriction on Miller's ability to cross-examine the independent expert, "the Court cannot say the Judgment presents a serious injustice or lacks basic fairness, such that nonrecognition is appropriate." Id. at 15.

 

Bryan R. Walters
Partner
Varnum LLP, Grand Rapids
brwalters@varnumlaw.com


This article originally appeared on the Varnum LLP internet site. You can access the original by clicking here. A search on the World Sports Law report internet archive for the term ‘injury’ returned over 70 results. For a free trial to World Sports Law Report, click here.


Thursday, June 19, 2014

Playing it with a straight bat – gagging clauses and the KP settlement soap opera

Say what you like about Kevin Pietersen (and many do) but he is never boring. As a young man, he controversially left his native South Africa in protest at its racial quota system to bring his mercurial talents to England.  Since then, cricket fans have watched him develop from skunk-haired, switch-hitting talisman to record-breaking run scorer, via a disastrous stint as captain and being dropped for sending texts about his team mates to the opposition. ‘KP’ was unlikely to leave the public stage quietly and, when it was announced that his England contract was not going to be renewed following the Ashes tour of Australia, rumours abounded about his (allegedly) disinterested and disruptive influence in the dressing room.  

For a while it seemed that these rumours would remain unsubstantiated as the England and Wales Cricket Board (ECB), keen to avoid further bad publicity after a shambolic winter tour, agreed settlement terms with Pietersen. These apparently included confidentiality and ‘gagging’ provisions on both sides, which prevented either party from discussing the events leading up to the termination of Pietersen’s contract, such as any dressing room bust-ups or details of the severance negotiations. However, this did not stop a constant drip feed of comments from individuals close to the player and eventually the ECB’s Managing Director, Paul Downton, weighed in with comments of his own. In an on-the-record statement to journalists, he remarked that Pietersen had appeared disinterested and distracted in the fifth Ashes Test in Sydney, and that he could not find any team mates who had wanted the batsman to remain in the team.

Pietersen reacted furiously to Downton’s comments, denying them and suggesting that they were in breach of the agreed settlement terms, with the ECB subsequently issuing a bland apology. In a further twist, it has recently been ‘revealed’ that the confidentiality provisions in the agreement expire on 1st October of this year, and that Pietersen has lined up an interview with his friend, Piers Morgan, to ‘blow the lid’ on his sacking.

All of the above begs the question, with this much public mud now being slung, what was the point of the settlement agreement in the first place?

The first point to make is that the precise terms of the settlement reached between the parties are still unknown. However, the relative lack of specific comment by the parties since January does support the idea that the agreement dealt, at least in general terms, with confidentiality and disparaging comments. As such, it seems likely that that any off-the-record briefing of friendly journalists by Pietersen was in breach of his contractual duties and/or that the ECB most likely breached its legal obligations to Pietersen through the actions of Downton.

The second point of interest is that it is very unusual for confidentiality and non-disparagement terms to be time-limited, as it has been suggested is the case here.  Confidential information can usually be divided into two categories: information that is and will always be confidential (for example, KFC’s or Coca Cola’s secret formulas); and information that is confidential now but will not be confidential in the future (for example, details of those companies’ next advertising campaigns). Confidentiality obligations are therefore open-ended, on the basis that there is a legitimate need to preserve the first category of information in perpetuity whereas the second category of information will, by its nature, cease to be protected once it is in the public domain or no longer commercially relevant.

Restrictions on the settling parties discussing the terms and background leading up to settlement and/or making any disparaging or damaging comment about the other also tend to be open-ended. This is because settlement is generally intended to be a final resolution to all disputes between the parties and allowing them to speak ill of the other, even after a reasonable passage of time, can only put such resolution at risk.

If it is true that the settlement agreement contained confidentiality and non-badmouthing provisions, one can only speculate as to why neither party sought to take action to pursue their potential claims against the other in this case. However, the ECB may have felt that proving that Pietersen was the source of comments made by others would be difficult and that getting involved in a public dispute with him would simply fan the flames of publicity. Equally, Pietersen may have been advised that the ECB would claim his conduct had constituted a repudiatory breach of contract, which released it from its obligations to him, and that any action he took could leave him open to an expensive counter-claim. In short, both sides may have considered litigation to be a messy, unsatisfactory and potentially expensive option.

It is also possible that time limiting the relevant terms suited both parties in this case. The ECB probably accepted that it was unrealistic to expect to gag Pietersen indefinitely and that the truth would come out eventually but wanted a window of relative calm to review matters such as the coach’s position and the captaincy. Pietersen for his part may have taken the view that interest in him would remain undiminished and that agreeing to a relatively short period of silence would simply delay his opportunity to have his say in a lucrative autobiography or interview, not reduce it. The way in which events have transpired may not have been perfect for either party. However, judged from this perspective, it appears their aims have broadly been met.

The cricket, and wider sporting world, waits with bated breath for 1st October…

 

James Williams
Partner
Hill Dickinson, London
james.williams@hilldickinson.com


This article originally appeared on the Hill Dickinson blog. To view the original, click here. A search on the World Sports Law Report archive returned three results under the text ‘settlement agreement’. To sign up for a free trial to World Sports Law Report, click here.


Tuesday, June 03, 2014

2022 FIFA World Cup Qatar: a convenient leak?

Last weekend, the Sunday Times published allegations that Mohamed Bin Hammam, former President of the Asian Football Confederation and member of FIFA’s Executive Committee, attempted to bribe football executives in order to secure votes for Qatar’s bid to host the 2022 FIFA World Cup. The allegations are supported by a cache of leaked documents which appear to reveal that Bin Hammam made a total of US$5 million in secret payments, in particular to heads of African football associations.

Following concerns expressed by the Asian Football Confederation, Qatar’s Supreme Committee for Delivery & Legacy, the organising committee for the 2022 World Cup, has denied the allegations. It stressed that Bin Hammam played ‘no official or unofficial role’ in Qatar’s 2022 bid, despite his Qatari nationality.

However, as the BBC points out, the ‘vast majority’ of African officials allegedly receiving payments did not have a vote. The Sunday Times is to publish further articles alleging that Bin Hammam’s strategy was to build a groundswell of support in Africa, which would then influence the four African members of the 22-strong (two were suspended from voting) FIFA Executive Committee members who did hold a vote.

As well as categorically denying the accusations made in the Sunday Times, a media statement from the Confederation of African Football (CAF) appears to question the logic of Bin Hammam’s alleged strategy. ‘The Sunday Times claimed just before 2 December 2010, Mr Hayatou received (60) World Cup match tickets from Mr Bin Hammam,’ reads the statement. ‘As Chairman of the Organising Committee of the 2010 World Cup and vice-president of FIFA, does Mr Hayatou need anybody to offer him match tickets for the World Cup as gifts? Is he not justified and entitled in his positions to receive match tickets?’

As well as replying to the Sunday Times’ allegations, a further statement from CAF President Issa Hayatou reveals that the CAF is considering legal action against the Sunday Times. ‘The CAF president reserves the right to sue and ensure that perpetrators of these fallacious rants are held responsible for their actions,’ it reads. 

If the allegations are proved true, the maximum number of votes Bin Hammam could have secured for his $3 million would have been four. That still leaves 20 members of FIFA’s Executive Committee that would need to be convinced of the merits of Qatar’s bid (two were suspended late on in the process). As the voting process is secret, we are yet to find out who else voted for Qatar and why. 

FIFA has been coming under increasing pressure over its decision to award the 2022 tournament to Qatar. Having previously threatened a boycott, player organisation FIFPro has lent its support for a winter World Cup in 2022, due to summer temperatures that can top 50 degrees centigrade. On the other hand, the European Professional Football Leagues (EPFL) has stated that ‘all scenarios on the re-scheduling  of the World Cup in Qatar are damaging the domestic competitions and Leagues’ business interests.’

Pressure is also building for action on the conditions suffered by migrant workers, almost 1,000 of whom have died building the facilities for Qatar 2022. The International Trade Unions Congress has demanded that FIFA take action over their treatment. UK Politician Jim Murphy has done much to expose the kafala system that ties workers to their employers, who can prevent migrant workers from leaving the country.

It appears that FIFA is caught between a rock and a hard place. If it goes ahead with the tournament as planned, it faces a potential player strike or potential heatstroke deaths. If it reschedules the tournament, it faces potential action from European football leagues due to revenues lost. In either case, it faces a potential political backlash over worker conditions, which could involve sponsors, TV companies and supporters boycotting the tournament.

The leaked emails and documents come just before Michael Garcia, the US lawyer heading the Investigatory Chamber of the FIFA-funded Independent Ethics Committee, is due to report his findings concerning the initial allegations of corruption in relation to the 2022 bidding process, on 9 June. The report and its findings, to be published six weeks later, will not consider the Sunday Times’s allegations. The leaked emails also come just before FIFA’s Executive Committee meeting on 7-8 June, where the 2022 World Cup is on the agenda. Both these events precede the FIFA Congress, on 10-11 June in Sao Paulo.

Any FIFA decision to re-run the election of the 2022 hosts would make all of these issues disappear, without delving into the difficult question of who, exactly, voted for Qatar and why. The Sunday Times’s initial article refers to payments made by a person already banned by FIFA, to smaller national associations not actually involved in the 2022 voting process. It would appear that the leak, upon which the Sunday Times’s allegations are based, has come about at a convenient time and in a convenient way for FIFA to take action.

Andy Brown


Monday, June 02, 2014

Australia's Major Sporting Events Protection Bill 2014 (Cth)

Key points:

• The Major Sporting Events (Indicia and Images) Protection Bill 2014 (Cth) is currently before Parliament.

• The Bill will apply to major sporting events including The Asian Football Confederation Asian Cup 2015, The Cricket World Cup 2015 and The Gold Coast 2018 Commonwealth Games.

• The Bill seeks to protect Major Sporting Events’ images and indicia (including words associated with the Major Sporting Events, such as “Queen’s Baton Relay”, with respect to the Commonwealth Games) against commercial exploitation by bodies other than the event body responsible for the major sporting event.

• The language and reach of the Bill is very broad.

• Any person who commercially uses a major sporting event’s protected indicia or images, without the prior approval of the event body may be subject to an order for damages, an injunction, ordered to publish a corrective statement (disclaiming any association with the major sporting event) or their goods may be seized by Australian Customs.

Protection of Images & Indicia

The Major Sporting Events (Indicia and Images) Protection Bill 2014 (Cth) (Bill) prohibits the commercial use of Protected Indicia by persons other than the event body, unless the event body has authorised another person, or body, to use the event’s Protected Indicia (Prohibition).

The Bill provides a list of what indicia and images are protected for the Major Sporting Events (Protected Indicia); for example, the following words and phrases are some of the Protected Indicia for the Commonwealth Games: “Australian Commonwealth Games”, “GC18” and “Queen’s Baton Relay” (Primary Words). Furthermore, if Primary Words are used in conjunction with other listed words, such as “agent”, “caterer”, “city” or “product”, then these phrases are also Protected Indicia.

The Bill also provides that where indicia or images are used which ‘so closely resembles’ Protected Indicia, where a reasonable person may mistake the indicium or image as being Protected Indicia, the used indicia or images are also Protected Indicia.

“Commercial use” includes where Protected Indicia are “applied to” a person’s goods or services or used for advertising purposes, provided that such uses would, to a reasonable person, suggest that the user was a sponsor or support provider of a major sporting event. “Applied to” is broadly defined to include where the Protected Indicia are ‘woven in, impressed on ... or affixed to the goods’, and it also includes the use of Protected Indicia on invoices, price lists, catalogues, brochures, and presumably menus.

Interaction with Other Laws

The provisions of the Bill are not intended to limit the application of other Commonwealth laws: remedies obtainable pursuant to the Bill are additional to those which may be available to the event body under other laws, such as the Australian Consumer Law, with respect to misrepresentations or the Trade Marks Act 1995 (Cth), with respect to trade mark infringement. The Bill also operates alongside certain State legislation; for example, with respect to the Commonwealth Games, the Bill operates in tandem with the Commonwealth Games Arrangements Act 2011 (Qld) (Queensland Act).

Permissible Use

The event body for the major sporting event may authorise other persons to commercially use the Protected Indicia for that major sporting event (Authorised User). With respect to the Commonwealth Games, the Bill recognises authorisations granted to persons under the Queensland Act, which permit the commercial use of Commonwealth Games’ Protected Indicia by such persons.

The Bill also permits Protected Indicia to be used for the ‘primary purpose’ of ‘criticism and review’ and for the dissemination of information via news and current affairs’ platforms.

Implications

Persons and businesses need to be aware of what words and images constitute Protected Indicia for the Major Sporting Events. They also need to ensure that they do not use Protected Indicia in any part of their business or marketing strategies, unless authorised to do so. By way of example, except with an authorisation, a restaurateur would not be permitted to develop and provide a “Commonwealth Games lunch” during the period in which the indicia are protected (i.e. any marketing flyers or menus with the words “Commonwealth Games lunch” printed on them would breach the Prohibition).

Persons who breach the Prohibition may be liable to account for profits made, be subject to injunctive orders or liable for any loss which the event body, or an Authorised User, may suffer. A corrective statement remedy may also be sought, whereby the person who breached the Prohibition may be ordered to publish (in a newspaper or on television, for example) a corrective advertisement explaining that there is no association between the person’s use of the Protected Indicia and the major sporting event. Imported goods which breach the Prohibition may be subject to seizure by Australian Customs and potentially be forfeitable to the Commonwealth.

If you would like further information or advice on how the Major Sporting Events Protection Bill may impact on your business operations please contact a member of our Kelly & Co. team.

 

Luke Dale
Partner
Kelly & Co. Lawyers, Adelaide
ldale@kellyco.com.au

 

This article originally appeared on the Kelly & Co. internet site. To view the original article, click here. A search on World Sports Law Report’s internet archive, which contains over ten years’ worth of sports law information, resulted in 108 articles. To sign up for a free trial to World Sports Law Report, click here


Wednesday, May 28, 2014

What the Premier League Clearly Did Not Learn from the Miami Dolphins

I recently wrote about the Miami Dolphins’ swift and effective response to offensive tweets posted by a player in response to the NFL’s draft of its first openly gay player, Michael Sam. Within a week, news of offensive and sexist e-mails written by Richard Scudamore, the Chief Executive of the Premier League, were leaked and the reaction of the League and the FA (Football Association) stands in stark contrast to that of the Miami Dolphins.

In case you didn’t see the reports, e-mails exchanged between Mr. Scudamore and a lawyer colleague included derogatory comments about women, including one woman with whom Mr. Scudamore worked. The e-mails were leaked by Mr. Scudamore’s personal assistant (PA) who said that she felt she had a duty to release them.

Here’s what happened next: the Premier League conducted an investigation, which is a good start, except that the investigation was apparently conducted by the Premier League’s only other board member, the Chairman. He did say that he utilized the services of an external law firm to assist in reviewing all of Mr. Scudamore’s e-mail correspondence and that there was “no evidence of wider discriminatory attitudes or inappropriate language or a general attitude of disrespect to women”.

Based on the investigation, the Premier League issued a statement advising that no further disciplinary action was required or justified in the circumstances. This decision seems troubling when one considers various aspects of the “investigation.” First, reports are that Mr. the Chairman and investigator in this case, Peter McCormick, is a close friend of Mr. Scudamore and that they have gone on shooting trips together. An independent investigation, this was not. Second, the investigation appears to have included discussions with other women in the League, including the woman who was supposedly referenced in some of the offensive e-mails. These women claimed to not have been offended by Mr. Scudamore’s behaviour, which seems a predictable response when the question is posed by the Chairman and friend of the alleged offender. How comfortable would any woman have been sharing true feelings of disrespect to someone holding this position?

It also appears to have been overlooked that, regardless of whether some women were not offended by these remarks, clearly the PA who leaked the e-mails was. There is a dispute as to whether she was required to view these e-mails in the course of her employment. The League claims that she searched them out, unauthorized, from a personal e-mail account, while the PA says that the e-mails were sent to her automatically so that she could organize Mr. Scudamore’s calendar. It does seem clear that the PA had access to these e-mails in the course of her duties, and the e-mails were sent from the Premier League account. Employees have a right not be subjected to offensive conduct or comment in the course of their employment, regardless of whether they were the subject or target of the offensive comments or conduct.

Mr. Scudamore has admitted to sending the e-mails and he did so using the employer’s e-mail system. Under the circumstances, it seems extraordinary that the League employer in this case has not found his behaviour worthy of some censure. What kind of message could the League possibly be hoping to send when a matter involving inappropriate comments made by one of the two most senior people in the organization is responded to by the other most senior person in this manner? It would seem that the Premier League could take a lesson from the Miami Dolphins on this one.

Christine M. Thomlinson
Partner
Rubin Thomlinson, Toronto
cthomlinson@rubinthomlinson.com

This article originally appeared on the Rubin Thomlinson blog. You can access the original by clicking here.


What Employers Can Learn from the Miami Dolphins

Michael Sam recently became the first openly gay player to be drafted by the National Football League. The University of Missouri defensive end was drafted by the St. Louis Rams in the final round and, in an obviously emotional moment (televised by ESPN) turned to his boyfriend and gave him a kiss. If you’ve seen the ESPN video, then you know that the kiss was hardly more than a peck and yet it prompted some negative reaction, probably the most notable of which was from Miami Dolphins defensive back Don Jones who tweeted, “horrible” and “OMG”.

Jones later deleted the tweets but he was fined an undisclosed amount and suspended from the team to attend sensitivity training in respect of his comments. Miami Dolphins Coach, Joe Philbin, said in a statement:

“We were disappointed to read Don’s tweets during the NFL Draft. They were inappropriate and unacceptable, and we regret the negative impact these comments had on such an important weekend for the NFL. We met with Don…about respect, discrimination and judgment. These comments are not consistent with the values and standards of our program. We will continue to emphasize and educate our players that these statements will not be tolerated.”

Now you may recall that, just two months ago, a report was released following an investigation into allegations of bullying amongst Miami Dolphins players. So, inasmuch as I’m sure the Miami Dolphins organization was not happy with the negative attention surrounding Jones’ comments above, especially following so soon after the bullying scandal, what is important to note here is the organization’s response. Jones was summoned to a meeting almost immediately after management learned of his comments and he has been punished (fined) and also ordered to attend training, presumably designed to ensure that if he is to continue playing for this organization, he understands the expected standards of behaviour.

 

Christine M. Thomlinson
Partner
Rubin Thomlinson, Toronto
cthomlinson@rubinthomlinson.com


This article originally appeared on the Rubin Thomlinson blog. You can view the original by clicking here


Wednesday, May 21, 2014

European Commission defers Striani complaint to Brussels court

This article has been moved to the main News Section of World Sports Law Report's internet site. To view this article, click here.


Tuesday, May 20, 2014

Scudamore - should he stay or should he go?

There is a depressing familiarity about the revelation that the Premier League’s Chief Executive, Richard Scudamore, has been involved in exchanging sexist and offensive emails with colleagues and a lawyer friend. After all, this is the game which allows a director of football to go unpunished for suggesting that a female lineswoman should “go and pose for Playboy” and has welcomed Messrs Keys and Gray back into the punditry fold, despite their boorish attitudes towards female colleagues and women in general.  In a week in which a report by the Women's Sport and Fitness Foundation has shown a continuing lack of proper female representation in the top tiers of sports administration, it appears that male chauvinism in football is alive and kicking.

Both the Premier League and the FA have confirmed that they are not intending to take any action over the emails and, despite widespread protests from a range of public figures and bodies, the consensus appears to be that Mr Scudamore is simply too powerful to be forced out.  The Premier League has enjoyed extraordinary commercial success under Mr Scudamore’s stewardship and so the desire to preserve this seems likely to win out over moral arguments in favour of him being disciplined. Indeed parallels can be drawn to Bernie Ecclestone’s tenure at the helm of Formula 1 despite his continuing legal battles regarding alleged bribery and judicial comment, which branded him an unreliable witness. Nonetheless, the Premier League’s inaction also exposes it to potentially legal liabilities, which should be factored into its decision-making.

Mr Scudamore has accepted that he sent and received the emails, which included crude slang references to women, ‘jokes’ about female irrationality and suggestive comments about a female colleague. Under UK law, “sexual harassment” occurs where one employee subjects another to “unwanted behaviour which is of a sexual nature and which has the purpose or effect of violating the other’s dignity or creating an intimidating, hostile, degrading, humiliating or offensive environment”. On the face of it, the emails therefore fall squarely within this definition.

Mr Scudamore’s defence is that the emails were sent and received from a “private and confidential email address” and that the temporary PA who leaked them should not have accessed them. However, the PA claims that his emails were sent to her automatically so that she could organise his diary, a claim which Mr Scudamore has not denied. Unless the PA trawled through Mr Scudamore’s private emails despite clear instructions not to do so, it seems reasonable to conclude that she was exposed to these emails whilst using the Premier League’s IT systems in the proper course of her duties, and that she was subjected to sexual harassment as a result. 

It is apparent that Mr Scudamore did not intend these emails to be read by his PA. However, the law is interested in the effect of a harasser’s conduct, as well as its purpose. There is a ‘get out’ where it is not reasonable for the conduct to have the effect of violating another’s dignity or creating an intimidating, hostile, degrading, humiliating or offensive environment (for example, if a victim is overly sensitive or goes out of their way to be offended). However, given the language and attitudes expressed in the emails, it is difficult to see this being applicable in this case. In circumstances where the effect of the emails seems clear and reasonable, Mr Scudamore’s lack of intention is irrelevant in law.

If Mr Scudamore’s conduct does constitute sexual harassment, the next question to consider is the extent to which the Premier League is vicariously liable for his actions as his employer. This will depend on a variety of factors, including whether the conduct took place during the course of his employment or in a personal capacity. Mr Scudamore claims that the emails were private. However, he appears to have used the Premier League’s IT systems to send, receive, view and/or store the emails, and at least one of them made reference to one of his female colleagues. This suggests a sufficiently close connection between the emails and his employment that his employer will struggle to avoid liability for his actions.

The Premier League could also try to avoid liability by demonstrating its commitment to combating discriminatory practices in the workplace. This would include, for example, showing that it operates an up-to-date equal opportunities policy and provides anti-discrimination training to staff, including Mr Scudamore. However, as Mr Scudamore is the most senior member of the organisation and one of only two members of the ‘Board’ responsible for ensuring that its policies are upheld, there are also likely to be significant challenges with this defence.

It remains to be seen whether the individual involved in bringing these emails to light chooses to bring legal proceedings against Mr Scudamore and the Premier League. However, the legal remedies available do not make it particularly attractive for her to do so.

She would theoretically be in line for uncapped compensation but this would largely depend on what losses, if any, she suffered as a result of the conduct. In circumstances where she was only engaged on a temporary basis, these losses are likely to be limited. She might also be entitled to an injury to feelings award, but this is not likely to exceed more than a few thousand pounds. A further remedy would be to ask the Employment Tribunal considering these matters to issue a recommendation for the Premier League to take steps to eliminate or reduce the effects of discrimination on its employees. The scope and framing of such a recommendation would be very interesting (could it, for example, consider the gender breakdown of senior staff?). However, the Tribunals have tended to make scant use of their discretion in this respect and the government is, in any event, proposing to remove this power.

In the circumstances, the PA may feel that her purpose has been served by leaking the emails to the papers, which have presumably compensated her appropriately whilst also allowing her to preserve her anonymity. Given the demonisation that those who have taken on the football authorities in the past have had to endure, frankly, who could blame her? However, at a time when the NBA is demonstrating its commitment to eradicating discrimination in sport by banning LA Clippers owner, Donald Sterling, for life for making racist comments, it is unfortunate that the English football authorities have not so far seen fit to take a similarly strong stance. Whilst they may be able to ride the storm on this occasion, it seems unlikely that behaviours will change unless decisive action is taken by (and, if necessary, against) those at the very top of the sport. Until this is done, it seems only a matter of time until the next sexism scandal rears its ugly head in the beautiful game. 

James Williams
Partner
Hill Dickinson
james.williams@hilldickinson.com


This article originally featured on the Hill Dickinson blog. You can access the original by clicking here.


Monday, May 19, 2014

Fantasy Sports Contests: Avoiding Civil and Criminal Liability

The Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA) prohibits any person engaged in the business of betting or wagering from knowingly accepting payments in connection with the participation by another person in unlawful Internet gambling.   Violation of this statute may result in criminal penalties, including monetary fines and imprisonment for up to five (5) years.  UIGEA has a well known ‘carve out’ for fantasy sports contests.  It is critical to note, however, that the carve out is fairly specific in its scope.  In addition, even if your business falls within the scope of the UIGEA fantasy sports exemption, you must still be mindful that some state laws do not permit fantasy sports contests within their borders.

Federal Fantasy Sports Liability Issues

As set forth above, UIGEA carries the potential for criminal penalties, including fines and/or imprisonment.   In light of this, and because there is currently much discussion and some uncertainty surrounding issues related to the duration of fantasy sports contests played for money, it is imperative to, at the very least, adhere to the basic rules that are clearly delineated in UIGEA.

First, for a fantasy sports contest to be legal under federal law, the outcome of the contest must be determined by the statistics generated by multiple athletes (on different teams) participating in multiple real-world sporting events. Accordingly, at a minimum, fantasy sports contests should require contestants to assemble a roster consisting of several athletes from more than one team and participating in more than one game.

Second, the prizes offered to the winners must be preset and not influenced by the amount of fees paid by the contestants, or the number of contestants in any given fantasy contest.  While it might be tempting as an operator of a pay-for-play fantasy sports contest to treat the purse for each contest like a lottery pool – the more players that enter, the greater the prize – such a scenario would be in violation of applicable law.  Instead, fantasy sports contest operators must set a prize amount prior to the commencement of the particular contest, and not modify that amount based on the number of entrants participating in the fantasy contest or the amount paid in entry fees.

State-Specific Fantasy Sports Liability Issues

On the state level, the legality of fantasy sports games that are played for money in many respects remains unclear and state laws and interpretations thereof are in a regular state of flux.  Some states have specifically legalized fantasy sports (e.g., Maryland, where the statute follows the UIGEA exception) or are considering draft legislation.   Other state laws appear to allow for fantasy sports contests, and then there are a small number of states that have statutes which seem to prohibit fantasy sports altogether (e.g. in Arizona, where operators of fantasy sports contests may face felony charges).  Bear in mind that, even if a given state permits fantasy sports contests, the state’s attorney general’s office may still commence an investigation and prosecute if the subject contest is otherwise violative of state deceptive advertising laws.  Finally, it is important to note that each state attorney general is authorized to enjoin certain violations of UIGEA.

Private Fantasy Sports Litigation

Be aware of the fact that private litigants may seek to take action against fantasy sports contest operators as well.  For example, a handful of Qui Tam actions have been filed in which a private individual sues on behalf of the state for alleged violations of state anti-gambling statutes.  There is also the potential that private suits and/or class actions may be brought based upon alleged violations of consumer protection and/or state marketing statutes.

Notwithstanding the foregoing warnings, remember that the fantasy sports arena is a rapidly growing industry that, if approached with caution and careful legal analysis, can result in a very lucrative business pursuit. This blog post only touches on a few of the relevant legal issues involved in the fantasy sports arena.  If you plan on engaging in, or operating, a fantasy sports venture, be sure to retain competent legal counsel to help you design the associated contests in a way that comports with applicable law, and best protects you and your business.

David O. Klein
Managing Partner
Klein Moynihan Turco LLP, New York
dklein@kleinmoynihan.com
 

This article originally appeared on the Klein Moynihan Turco LLP blog. You can access the original by clicking here. A search for ‘fantasy sports’ on the World Sports Law Report internet site returned four articles. To sign up for a free trial to World Sports Law Report, click here


Monday, May 12, 2014

Australia: Legislating against ambush marketing

A Bill that increases protection against ambush marketers, who try to get a free ride by piggybacking off major sporting events, is welcome news for event organisers and sponsors. The Major Sporting Events (Indicia and Images) Protection Bill 2014 was introduced into Federal Parliament on 26 March 2014. The legislation specifically protects next year’s AFC Asian Cup, the ICC Cricket World Cup 2015, and the 2018 Gold Coast Commonwealth Games.

This new event-specific ambush marketing legislation increases protection of the commercial rights and marketing efforts of event owners and sponsors by legislating against unauthorised commercial use of certain event indicia (text and other distinguishing marks) and images. This bolsters support currently provided to rights owners and their licensees by the Trade Marks Act 1995 and the Australian Consumer Law. The Major Sporting Events (Indicia and Images) Protection Bill 2014 follows on from the Olympic Insignia Protection Act 1987 and other event specific legislation created for the Australian Grand Prix, Sydney Olympics and Melbourne Commonwealth Games.

Ambush marketing

Local organising committees, who own events and the related event intellectual property and commercial rights, rely on sponsorship to provide essential revenue for staging events. Businesses that do not sponsor the events may seek to capitalise on the event by using event indicia or images in order to associate themselves (sometimes subtly) with the event.  This is known as ‘ambush marketing’.  

While ambush marketing may comprise advertising or marketing that is clearly misleading and would be unlawful under existing legislation, ambush marketers are often more savvy than this.  A business may seek to associate itself with an event but stop short of representing that it is an official sponsor; that is, it misappropriates for itself the benefit of the reputation (and feel good factor) of the event but does not misrepresent an association with it.  This in itself may not be in breach of the Australian Consumer Law, and it also may not involve the use of a registered trade mark associated with the event. 

Benefits to sponsors

The new ambush marketing legislation will provide an added level of comfort to official sponsors who believe existing legislative mechanisms are inadequate and do not prevent freeloading businesses diluting genuine sponsor marketing efforts.

As mentioned, consumer law does not cover all the issues. There are also certain types of event indicia – like common words, titles and short expressions – that are not covered by the Trade Marks Act 1995. This new legislation will prevent or minimise broader forms of ambush marketing by going beyond the normal prohibitions against trade mark infringement and misleading or deceptive conduct. 

The key features of the Bill include:

• Prevention of the unauthorised commercial use of protected indicia and images.

• Protection of the use of agreed words and phrases, and variants of event names and known abbreviations, associated with each event.

• The establishment of a registration process and the creation of an online register containing details about authorisations to use indicia and images for each event. 

• Provision of a range of remedies including injunctions, damages, corrective advertisement and the seizure of goods.

• Exceptions allowing for the continued operation of rights and liabilities under the Trade Marks Act 1995, Designs Act 2003, Copyright Act 1968 and the Competition and Consumer Act 2010 (Australian Consumer Law). 

The Bill contains a list of protected indicia that may only be used by authorised users (i.e. official sponsors) during specified periods of time around each sporting event.  For example, protected indicia for the ICC Cricket World Cup 2015 include the phrases, “Cricket World Cup” and “CWC 2015”. 

The Bill also contains two lists of expressions that are protected when a phrase from one list is combined with a phrase from the other list.  For example, one list contains phrases that are similar or identical to terms on the protected indicia table like “Cricket World Cup”, while the other list contains general terms like “caterer” and “merchandise”.

Event owners will have an expanded range of legal remedies to protect their intellectual property. This includes the ability to enforce their rights by threatening or taking legal action under event-specific legislation. This means improved security for sponsorship revenue, and a more attractive investment for sponsors.  This is good news for these upcoming world class sporting fixtures.  

 

David Yates Partner
Mark Hyde Associate
Corrs Chambers Westgarth, Perth
david.yates@corrs.com.au
mark.hyde@corrs.com.au

 

This article originally appeared on the Corrs Chambers Westgarth internet site. You can access the original by clicking here.

 

A search on World Sports Law Report’s internet site revealed 40 articles on ambush marketing. To sign up for a free trial to World Sports Law Report, click here.


Friday, May 02, 2014

Is football finally becoming a 21st century employer?

When rumours first surfaced that David Moyes was to be relieved of his duties by Manchester United, it seemed that his team’s lacklustre performance in the 2-0 defeat to his old club Everton FC was the straw that broke the camel’s back. However, it seems that there may have been a bit more to the timing than simply the events at Goodison Park. The result guaranteed that Manchester United would not be participating in the Champions League next season (for the first time in 19 years). It has since been widely reported that this failure meant that the manager’s six year contract could be terminated with immediate effect, with a pay-off of no more than 12 months’ remuneration, despite still having more than five years to run.

Moyes was reported to be earning £4.5 million a year under his contract with Manchester United, so even though he is only getting one year’s worth of compensation he is not doing too badly out of the deal. However, in the crazy world of football contracts and finances, such performance-related caps on severance remain relatively rare. There are plenty of examples, both past and present, of players being signed up on long and lucrative deals only for the expected levels of performance to fail to materialise. Clubs are then lumbered with paying out huge salaries season after season, with little chance of offloading the underperforming player unless they agree to pay the player off or loan them out and continue paying a hefty chunk of their inflated salary.

Managers are also awarded long contracts but, when they fail to perform, it is not an option to force them to train with the reserves or loan them out. A club wanting to part ways with its manager is therefore usually left with no option but to bite the bullet and pay out the remainder of his contract, or at least a substantial part of it. Even when such payments are paid out in instalments, there is little incentive for managers to mitigate their losses by rushing to find another job - as the FA discovered to its cost after terminating Sven Goran Eriksson’s contract as England manager. Chelsea are famously said to have paid out almost £50 million to the managers they have sacked over the last 10 years, many of whom have subsequently gone on to take well-paid jobs with other large clubs.

No other business would ever allow itself to be put in this position. In the real (i.e. not football) world, senior employees are rarely given fixed terms or notice periods of more than 12 months, which is in line with corporate governance guidelines that advise against it. We are constantly told that football is a special case and different from other businesses, not least because playing careers are short and managerial tenures are notoriously insecure. For so long as TV companies are willing to pay exorbitant broadcast fees, it is accepted that the best talent will demand their share. Add in the market-distorting antics of new entrants, rich with oil or commodity wealth, there is a case to say that some of football’s challenges may be unique. However, many of the same points can be made about individuals working in other areas of business, where these challenges are nevertheless managed through the use of properly considered and drafted employment contracts.

For example, specialist and highly paid employees in the financial services sector, such as traders and fund managers, are often critical to the fortunes of their employer and therefore generally enjoy a large slice of the profits they generate as a reward (up to 50% in some cases). They also typically have fairly short careers, often retiring in their late 30s/early 40s due to burn-out (and the fact that they have accumulated substantial wealth and never need work again). In short, they are pretty similar to professional footballers and managers in a number of material respects.

Such employees are sometimes engaged on fixed term contracts of more than 12 months. However, these invariably contain clauses allowing for early termination in the event of poor performance, sometimes coupled with a right to reduce remuneration if particular targets are not met. This ensures that both employer and employee are able to benefit when things go well but, crucially, also ensures that the employee bears his or her share of the pain when they go sour.

In addition to such performance-related incentives and disincentives, the contracts of such employees typically contain restrictions on their activities after their employment ends. Such examples being: restrictions preventing the employee from targeting or interfering with their ex-employer’s clients, suppliers or key staff for a period of time (usually 6 to 12 months) and/or a restriction on working for a competitor for a similar period. Even when such restrictions are not enforced (or are, perhaps, unenforceable), they can create a strong negotiating position from which the employer can secure a sensible severance outcome.

Engaging football players on contracts of this sort would be complicated, first by the registration system, but secondly by the fact that clubs usually treat their players’ registrations as intangible assets and account for them accordingly. However, no such concerns relate to managers and there is no reason why more managers should not be subject to ‘ejector seat’ clauses that limit their pay-outs in the event of unacceptable levels of performance. Perhaps, in his departure, David Moyes has contributed to the development of football in a way his team was unable to achieve on the pitch.


James Williams
Partner
Louise Millington-Roberts
Partner
Hill Dickinson, London
james.williams@hilldickinson.com
louise.millington-roberts@hilldickinson.com


This article originally appeared on the Hill Dickinson internet site. You can view the original by clicking here. A search on World Sports Law Report’s internet site for ‘manager contracts’ revealed seven articles. To sign up for a free trial to World Sports Law Report, click here.


Wednesday, April 30, 2014

Belgium national football team denied protection of image rights

From June 12 to July 13 2014, all football-loving eyes will be directed towards the World Cup in Brazil. This will definitely be the case in Belgium, as its national team, the Red Devils, last qualified for the World Cup in 2002. Support for the Red Devils in Belgium is immense and grew significantly during the qualification rounds. More than 20,000 supporters attended the first Red Devils Fan Day on June 2 2013 and the Royal Belgian Football Association (RBFA) – the Belgian governing body for football – received so many offers to sponsor the team that it had to turn some of them down.

The tremendous (commercial) success of the Red Devils has not gone unnoticed. The qualification rounds received heavy press coverage and this is expected to increase once the World Cup starts. Some organisations may try to cash in on the team's success.

A recent case came before the Belgian courts in which the RBFA claimed that a book cover photograph infringed the Red Devils' image rights. The dispute arose from the first publication of the book "Football Annual 2012-2013" by a Belgian publisher with the cover below.

About 80% of the cover comprised a picture of six of the Red Devils (including Vincent Kompany, Kevin De Bruyne and Kevin Mirallas) celebrating after their team scored a goal during a World Cup qualification match. The back cover included text describing the book as a summary of the previous football season, covering both the Belgian and international league, as well as the national team. The book also contained interviews with some of the Red Devils depicted in the cover photograph.

In Belgium, the RBFA is competent to enforce the individual and collective personality rights of the players in their capacity as members of the Red Devils. The RBFA had already signed an agreement with another publisher, which had published The Official Red Devils Book and was authorised to use a similar cover photograph. The RBFA thus claimed that the unauthorised publisher's publication of Football Annual 2012-13 jeopardised its relationship with the authorised publisher (as well as with any future partners). When the unauthorised publisher failed to reply to the RBFA's formal written notice, the RBFA initiated expedited proceedings for infringement of the players' image rights and requested a court order to have all copies of the annual withdrawn from sale and its cover replaced.

Right to privacy

The question of whether the unauthorised publisher could use the contested photograph on the cover of the football annual was answered in the affirmative by both the president of the Brussels Court of First Instance1 and the Brussels Court of Appeal2.

Image rights are personality rights that an individual has over his or her own image and which protect individuals from taking and publishing photographs without their consent. However, these rights are restricted by the right to freedom of expression and the freedom of the press, as laid down in Article 10 of the European Convention on Human Rights, Article 19 of the International Covenant on Civil and Political Rights and Articles 19 and 25 of the Belgian Constitution. This restriction unequivocally applies to public figures, who are:

"persons holding public office and/or using public resources and, more broadly speaking, all those who play a role in public life, whether in politics, the economy, the arts, the social sphere, sport or in any other domain3."

The use of images of public figures without their prior consent is subject to two conditions:

• The image is used for information purposes only.

• The public figure's right to privacy is not infringed.

The courts in both instances confirmed that these principles applied to this case. The courts held that the players' right to privacy had not been infringed, because the photo had been taken during an official game of the Red Devils – that is, during a public sporting event, through which the players in question had become well-known public figures. However, the discussion focused on whether the first condition had been breached.

Commercial purpose

The RBFA claimed that the photo had not been used solely for information purposes, but was rather a blatant attempt to free-ride on the success of the Red Devils, in particular because it was the largest feature on the cover and thus served as an eye-catcher for potential buyers. This constituted a commercial purpose and the publisher therefore should have obtained prior consent from the RBFA.

Both courts disagreed with this claim, agreeing with the annual's publisher that the photo could be freely used, as it had been used purely for information purposes. In the courts' view, the annual clearly aimed to inform readers about the Belgian league and international teams in the 2012/2013 season. The qualification of the Red Devils for the World Cup finals was an inevitable and important part of the past season, as confirmed by the heavy press coverage. The fact that the annual was not written by a journalist, was not presented in a newspaper or magazine and was more expensive than a newspaper or magazine did not alter this conclusion. The court of appeal believed that the photo had a direct relationship with the content of the book, and that it had its own value as information, regardless of the fact that the publisher had profited from publication of the annual. The RBFA's claim based on the personality rights of the players was therefore dismissed as unfounded.

Comment

The RBFA's attempt to protect its players' interests and IP rights4 thus failed. With the World Cup finals approaching, it is likely that other companies will also try to use images of or references to the Red Devils. The Belgian press recently reported on the publication of a comic book telling the history of the Red Devils in World Cup competitions since 1930, as well as the launch of a champagne named 'Les Diables Rouges' ('Red Devils' in French) by a French wine house. It remains to be seen whether the RBFA will be able to stop these companies (in or outside the court).

 

Sarah Van Nevel
Philippe de Jong
ALTIUS, Brussels
sarah.vannevel@altius.com
philippe.dejong@altius.com


1. President of the Brussels Court of First Instance (expedited proceedings), September 26 2013, 13/1268/C, available at www.ie-forum.be.

2. Brussels Court of Appeal (expedited proceedings), November 12 2013, 2013/KR/234, available at www.ie-forum.be.

3. Resolution 1165, Right to privacy, Parliamentary Assembly, European Council, June 26 1998, nr 7.

4. For example, RED DEVILS is registered as a Benelux and international trademark.

 

This article originally appeared on the International Law Office internet site. You can access the original by clicking here. To take out a free trial to World Sports Law Report, click here.


NLRB Region 13 Rules Northwestern University's Football Players Can Unionize

In a case of first impression, Region 13 of the National Labor Relations Board (NLRB) determined that football players who are on scholarship at Northwestern University are “employees” of the school and eligible to vote whether they want to be represented by the Collegiate Athletes Players Association (CAPA), an entity financed by the United Steelworkers (USW) union.

According to the decision, “players receiving scholarships to perform football-related services for the Employer [Northwestern] under a contract for hire [athletic scholarships] in return for compensation [tuition, room & board, and stipends] are subject to the Employer’s control [team rules] and are therefore employees within the meaning of the Act.”

Region 13 determined that athletic scholarships are an employment contract for compensation since they cover a football player’s tuition, fees, room, board, and books for up to five years. In fact, the value of football scholarships at Northwestern is roughly $76,000 per year resulting in a total compensation package in excess of one quarter of a million dollars throughout the four or five years they perform football duties.

Walk-on football players do not meet the NLRB’s definition of employees because they do not receive a scholarship or compensation for their time devoted to the Northwestern football program and thus are not eligible to vote in the upcoming union election.

Northwestern University as the “employer” has the right to request a review of this decision by the full National Labor Relations Board in Washington, D.C. It is expected that the school will seek such review, though the full NLRB will likely rubber stamp Region 13’s conclusion. From that, Northwestern can appeal the matter to a Federal Circuit Court where a different outcome may occur.

This decision raises more questions than it answers.

Northwestern is a private university, and this decision, if it stands, likely governs other private universities regardless of sport or division. Football players – or any athletes – at public universities would have to abide by their own state’s collective bargaining laws and may not meet their individual state’s definitions of “employee.” For example, Northwestern football players may have federal collective bargaining rights under the National Labor Relations Act, but football players for The Ohio State University may not have collective bargaining rights because they may not be “employees” under State Employment Relations Board doctrine.

Although other areas of employment law have different standards of what constitutes an “employee,” most standards are very similar resulting in the following questions being further raised by this decision:

• Are Northwestern football players who are on scholarship entitled to overtime pay for all hours worked in excess of 40 hours each week? According to testimony in the NLRB case, players spent 50-60 hours per week devoted to football during training camp and upwards of 25 hours over a two-day period traveling to and from away games, attending practices and meetings, and competing in those games.

• How does the determination that football scholarships are “compensation” impact a student-athlete’s eligibility? Specifically, the NCAA prohibits student-athletes from receiving compensation for just about everything and suspends players from games and schools from bowl games and future scholarships for breaking this rule.

• Are Northwestern scholarship football players now eligible for workers compensation benefits for injuries sustained while engaging in football-related endeavors?

• Will the Board ultimately expand this issue from student-athletes who receive scholarships to students who receive scholarships related to the arts and sciences? For example, does a student who receives a scholarship requiring her to major in music become an “employee” since the scholarship requires her to take music classes like the football player is required to practice and play football?

Since this issue has severe ramifications to every college and university that offers scholarships of any kind to its students, look for updates from the attorneys at Roetzel & Andress as new developments happen.

 

Matt Austin
Roetzel & Andress, Columbus, Ohio
maustin@ralaw.com


This article was originally published on the Roetzel & Andress Employment Services Alert. You can access the original by clicking here. To take out a free trial to World Sports Law Report, click here.