Red card for defendant ordered to pay the Premier League US$213 million
In a recently published judgment, the Premier League was awarded nearly US$213 million in missed payments from a Hong Kong company under contracts to broadcast football matches during the 2019/2020 season, despite the impact of COVID-19.
Football Association Premier League Ltd v PPLive Sports International Ltd  EWHC 38 (Comm) is an instructive decision as to the benefits of summary judgment as a powerful tool for claimants, as well as the pitfalls of self-representation in high stakes litigation.
In February 2017, the parties entered into a contract whereby PPLive Sports International Ltd (PPL) licensed the rights to broadcast live Premier League matches in China for the 2019/2020, 2020/2021 and 2021/2022 seasons. The total contract price over the full term of the contract was US$701 million. Another contract was entered into in February 2019 to broadcast Premier League clips packages for the relatively modest amount of US$8.02 million. It was a term of both contracts that: “the format of the [Premier League season] will not undergo any fundamental change which would have a material adverse effect on the exercise of the Rights by the Licensee [PPL].” If such a “fundamental change” occurred, PPL was entitled to enter into good faith negotiations with the Premier League in order to discuss a possible reduction to the fees payable.
The first season of the contracts was intended to run from August 2019 to June 2020. This was severely disrupted by the pandemic. The season was temporarily suspended on 13 March 2020. The UK government announced its first “lockdown” ban on public gatherings including sporting events on 23 March 2020. A formal suspension of the season followed on 3 April 2020. The fixtures resumed in very different conditions on 14 June 2020 with the remaining 92 fixtures completed by 26 July 2020.
Around the time of these suspensions, PPL missed payments of instalments of US$210.3 million on 1 March 2020 and US$2.673 million on 1 June 2020 under the respective contracts. PPL’s main defence was that the rearranged fixtures, taking place in a compressed period, on different days, with different kick off times, and without fans, constituted the necessary “fundamental change” to the format of the competition. It is not clear whether any negotiations took place – the judge noted that if they did, they were probably without prejudice – but in any event no compromise was agreed. The Premier League continued to provide PPL with the contract packages for the remainder of the rearranged season, whereafter it terminated both contracts and issued proceedings against PPL. The summary judgment application was issued in April 2021, with the hearing taking place before the Commercial Court on 29 and 30 November 2021.
The judge found against PPL on its “fundamental change” arguments, following the now well-established principles of contractual construction, involving a balancing act between the words the parties actually used in the contracts and the background factual matrix. The judge interpreted “the format” as being concerned with the number of matches in any given season, the fact they were played at home and away, how many points were awarded and how the table was organised – none of this changed as a result of the pandemic. The scheduling of fixtures fell within the Premier League’s discretion under the contracts; the rescheduling of fixtures being a relatively common occurrence notwithstanding COVID-19 (although perhaps not on the same scale). Taking a dispassionate view, the judge found “Without in any way being thought of as disparaging…whether fans are present in a stadium or not, the match still consists of Team A playing Team B.” Although it might have affected the result, that was not the same as affecting the format.
The judge found that neither the “fundamental change” nor any PPL's other defences had a real prospect of success and there was no other compelling reason for a trial. The Premier League was granted summary judgment for the missed instalments plus interest. Despite the presence of force majeure provisions in the contracts and some ambiguity in PPL’s skeleton argument, force majeure did not arise on PPL’s pleaded case and so whether or not the pandemic constituted a force majeure event was not resolved as part of the application. Any such analysis may well have led back to the judge’s decision on the lack of a “fundamental change”, with the same result.
Despite the presence of force majeure provisions in the contracts and some ambiguity in PPL’s skeleton argument, force majeure did not arise on PPL’s pleaded case and so whether or not the pandemic constituted a force majeure event was not resolved as part of the application. Any such analysis may well have led back to the judge’s decision on the lack of a “fundamental change”, with the same result.
Interestingly, in another recent judgment, European Professional Club Rugby v RDA Television LLP  EWHC 50 (Comm), which concerned a dispute in relation to media rights to broadcast European Champions Cup and Challenge Cup rugby matches, the onset of the pandemic was found to constitute a force majeure event. The contract included “epidemic” in a list of force majeure events, which the judge found included pandemic in the context of the contract. In any event, the judge noted that the general wording of the force majeure clause covering circumstances “beyond the reasonable control of a party affecting the performance by that party of its obligations” also included the pandemic.
The judge found that the contract had required "Available Live Matches" for the 2019-2020 season including each quarter final, semi-final and final in each of the Competitions to be made available. When the termination notice was served, none of those rounds of either of the competitions had been staged or even re-scheduled or made available for live transmission. The judge held that it was clear this was the result of the pandemic, and that this was sufficient to permit termination pursuant to the force majeure clause.
Returning to the Premier League's case, the judgment’s summary of pre-hearing applications reveals that PPL’s former solicitors applied to come off the record over 3 weeks before the hearing following non-payment of legal fees. At that time, PPL did not intend to appoint a replacement. To an outside observer, PPL’s next steps seem contradictory. First, it applied for permission for its employees to represent PPL in the litigation, which the Court granted. Second, it served a skeleton argument in line with an agreed timetable and engaged with the Premier League’s solicitors and the Court in preparing for the hearing. Third, it applied for an adjournment of the hearing on the basis that it needed more time for compiling evidence and instructing alternative solicitors.
Despite noting that it was “not usually (or ever) advisable for parties to represent themselves” the Court allowed PPL’s employees to do so based on the unusual circumstances of the case. The application for an adjournment was refused for a number of reasons, including the fact that comprehensive evidence in response had already been served by PPL’s former solicitors, there had been sufficient time to instruct alternative solicitors and PPL was the cause of being unrepresented due to the non-payment of its legal fees.
This case is a good example of the force behind a well-conceived summary judgment application, which can provide claimants with a shortcut through time consuming and expensive litigation. In this case, concerning payments of nearly US$213 million, there were approximately 9 months between issue of the application and release of the judgment. Indeed, one of the reasons why PPL’s application for an adjournment was refused was precisely because of the likely delays caused in re-arranging the hearing, which would not have been possible earlier than July 2022. In the judge’s words: “In circumstances where the whole ethos of CPR Part 24 is to deal with cases where a defendant has no real prospect of successfully defending a claim or issue, such delay is to be avoided”. The judge’s flexibility in allowing PPL to represent itself demonstrates both the Court’s push for disputes to be resolved expeditiously, as well as why self-representation can be risky.
The case also highlights the ongoing fall-out of the pandemic in the litigation arena, with cases of this kind continuing to come to the English Courts. The Football Association Premier League judgment, where the impact of the pandemic on matches did not relieve the broadcaster of its payment obligations, contrasts with the European Professional Club Rugby judgment, where the impact did constitute a force majeure event.