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England and Wales High Court (Chancery Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Attheraces Ltd & Anor v Ladbrokes Betting And Gaming Ltd & Ors  EWHC 431 (Ch) (06 March 2017)
Cite as:  EWHC 431 (Ch)
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IN AN INTENDED ACTION
Rolls Building, Fetter Lane
London, EC4A INL
B e f o r e :
(1) ATTHERACES LIMITED
(2) ARENA LEISURE LIMITED
|- and -
(1) LADBROKES BETTING AND GAMING LIMITED
(2) LADBROKES SPORTSBOOK LP
(3) LADBROKES CORAL GROUP PLC
(4) CORAL RACING LIMITED
(5) CORAL INTERACTIVE GIBRALTAR LIMITED
(6) DONE BROTHERS (CASH BETTING) LIMITED
(7) PETFRE (GIBRALTAR) LIMITED
(8) SPOERTS INFORMATION SERVICES LIMITED
(9) SIS LIVE LIMITED
Mr. Tom Weisselberg, Q.C. and Ms. Victoria Windle (instructed by Mishcon de Reya LLP) for the First to Fifth Respondents
Mr. Paul Stanley, Q.C. (instructed by Olswang LLP) for the Sixth and Seventh Respondents
Mr. Michael Bloch, Q.C. (instructed by Olswang LLP) for the Eighth and Ninth Respondents
Hearing dates: 28TH February 2017
Crown Copyright ©
Mr Justice Marcus Smith:
The factual background
i) The "Ladbrokes/Coral Group", comprising (for present purposes) the First to Fifth Respondents; and
ii) The "Betfred Group", comprising (for present purposes) the Sixth and Seventh Respondents.
Although they do other things (like on-line betting), both the Ladbrokes/Coral Group and the Betfred Group operate licensed betting offices. During the course of this year – the relevant period for present purposes – none of the Ladbrokes/Coral Group nor any of the Betfred Group have had any right to use the course coverage. That is simply because they have chosen not to take a licence.
The Ladbroke/Coral Group and Betfred commentaries
"…the Respondents have, so far, and despite requests, failed to reveal the source of the live coverage being misused and/or explain how they say they are entitled to produce or facilitate the production of "off-tube" commentaries…thus necessitating this urgent application."
i) The Ladbrokes/Coral Group. In his first statement filed on behalf of the Ladbrokes/Coral Group ("Chambers 1"), Mr. Mark Chambers states:
"5. Since 1 January 2017, Ladbrokes Coral has produced off-tube commentaries of races from Arena Courses and such commentaries have been made available in Ladbrokes Coral LBOs. Ladbrokes Coral has never denied that it makes such commentaries available.
6. As has been made clear by Ladbrokes Coral from the outset of this dispute, the Applicants have no right to prevent Ladbrokes Coral from producing such off-tube commentaries: Ladbrokes Coral is not infringing any rights (whether by way of copyright or otherwise) of the Applicants nor any obligations (in contract or otherwise) which are owed to them…
9. Since 1 January 2017 Ladbrokes Coral have not shown pictures of races from the Arena Courses. However, off-tube commentary from such courses has been made available within our LBOs.
10. As the term suggests, "off-tube" commentaries are taken from off the tube i.e. from the TV, and that is exactly what Ladbrokes Coral has done in relation to our commentaries from the Arena Courses. By way of further detail, I set out below how off-tube commentaries from the Arena Courses have been made since 1 January 2017.
10.1 Ladbrokes Coral has available to it a number of subscriptions to Sky TV, the well-known satellite broadcaster. One of the channels available on the Sky TV platform is "At the Races". "At the Races" includes live coverage of races from the Arena Courses.
10.2 Ladbrokes Coral uses freelance broadcasters to watch "At the Races" on Sky TV using one of the subscriptions I refer to above. These broadcasters commentate on the races and that commentary is subsequently broadcast into Ladbrokes Coral LBOs…"
In his second statement ("Chambers 2"), Mr. Chambers confirms (at paragraph 8) that the Sky TV subscriptions used for this purpose were subscriptions of the Ladbrokes/Coral Group. It is worth noting that this use of Sky TV subscriptions has now ceased.
Mr. Kingston pointed out (at paragraph 78 of Kingston 1) that this use of the Sky TV subscription was (in his view) likely a breach of the terms of the subscription agreement. On 20 February 2017, Sky wrote to the Ladbrokes/Coral Group complaining of this practice and alleging breach of their Sky subscription agreement. On 22 February 2017, the Ladbrokes/Coral Group responded, stating that, without any admission of liability, they would not use "At the Races" for the purpose of creating "off-tube" commentary broadcast in the LBOs.
ii) The Betfred Group. In his first witness statement filed on behalf of the Betfred Group ("Siers 1"), Mr. Philip Siers states:
"18. On 2 January 2017, and for that one day alone, we provided sound commentary (but no video) in our LBOs in respect of three or four Arena Races on the basis of having a commentator watch the ["At the Races"] channel (under a normal subscription agreement with Sky which included ["At the Races"] in the package) and to produce the commentary in that way (but of course not showing any of the underlying video). I was not aware on 2 January 2017 that we had used off tube commentaries in this way and on hearing of this activity, I ensured that this activity ceased after this one day.
19. We continue to have synthesised commentary on Arena Races in our LBOs although such commentaries as we have are very limited, and could not be construed in any way as a professional commentary, normally delivered to LBO. These synthesised commentaries contain very limited content and detail, and are used only for the closing stages of each race, and it is not our intention to provide this for every race. The manner in which we now create this commentary is a matter of commercial sensitivity and I am not prepared to disclose how this is done. However, I can say:
(a) we are not using any ["At the Races"] content…;
(b) we are not using any material provided by the Eighth or Ninth Respondents in order to produce this commentary; and
(c) I would be prepared to disclose information regarding the means by which we produce the commentary to named individuals within the solicitors and counsel for the Applicants provided they in advance enter into a confidentiality ring under which they undertake not to disclose that information to their clients or any third party. That information could then also be available to the Court."
In his second statement ("Siers 2"), Mr. Siers provided further detail of how a "synthesised commentary" is produced for the Betfred Group. I heard submissions of the Applicants in relation to their application against the Betfred Group in private in order to preserve the confidence in Siers 2. It has been possible to write this Judgment without referencing the confidential material in Siers 2, and accordingly this Judgment is public.
iii) Sports Information Services. In his first witness statement filed on behalf of Sports Information Services ("Graham 1"), Mr. Andrew Graham explained that the off-tube commentaries used by the Ladbrokes/Coral Group and by the Betfred Group have not been produced by Sports Information Services.
"(1) This rule applies where an application is made to the court under any Act for disclosure before proceedings have started.
(2) The application must be supported by evidence.
(3) The court may make an order under this rule only where –
(a) the respondent is likely to be a party to subsequent proceedings;
(b) the applicant is also likely to be a party to subsequent proceedings;
(c) if the proceedings had started, the respondent's duty by way of standard disclosure, set out in rule 31.6, would extend to the documents or classes of documents of which the applicant seeks disclosure; and
(d) disclosure before proceedings have started is desirable in order to –
(i) dispose fairly of the anticipated proceedings; or
(ii) assist the dispute to be resolved without proceedings; or
(iii) save costs.
(4) An order under this rule must -
(a) specify the documents or classes of documents which the respondent must disclose; and
(b) require him, when making disclosure, to specify any of those documents –
(i) which are no longer under his control; or
(ii) in respect of which he claims a right or duty to withhold inspection."
i) As is clear from Kingston 1 (in particular paragraphs 80ff), the Applicants' initial position was that they did not know how the Ladbrokes/Coral Group and the Betfred Group had produced their commentaries.
ii) This, so it was said, prevented a claim being pleaded even in draft form. That may have been the case when the application was made: but was not the case after the evidence of Mr. Chambers and Mr. Siers had been received. It may be that that evidence came so late as to preclude the formulation of draft particulars of claim, and I make no criticism of the Applicants in this regard. But the consequence was that the court had no particularly clear idea of how the Applicants were planning to put their case in the anticipated proceedings.
iii) Indeed, it is fair to say that the basis of the Applicants' claim against the Ladbrokes/Coral Group and the Betfred Group underwent significant change over time:
a) As against the Ladbrokes/Coral Group, the case was originally said to be based on breach of contract, copyright infringement, inducing or procuring a breach of contract and/or conspiracy. By the time the application was heard, the Applicants' claim was confined to an alleged unlawful means conspiracy. What is more, the nature of the loss suffered by the Applicants as a result of this conspiracy was, to say the least, nebulous. Loss appears to be predicated on the Ladbrokes/Coral Group purchasing the commentary or the right to use the commentary from Sky or some other party, which financial benefit would (in the end) trickle down to the Applicants.
b) As against the Betfred Group, the case is now said to be based on unlawful means conspiracy and on passing off. In the latter case, it appears that the Applicants were maintaining their claim even if the commentary produced by the Betfred Group was produced lawfully and not (as alleged for the purposes of the conspiracy claim) in breach of contract. Again, the loss sustained by the Applicants was not clearly put.
iv) Given these developments after the applications had been issued, the documents sought by the Applicants by way of pre-action disclosure underwent significant change. The application by the Applicants appended a draft order, seeking disclosure of material (by class of document) relating to the manner in which the off-tube commentaries had been produced. In light of the evidence of the Ladbrokes/Coral Group, the disclosure sought had to be substantially modified; and it was, in the form of a draft order produced by the Applicants on the day of the hearing.
v) In light of the evidence of the Betfred Group, the entire basis of the disclosure sought had to be revisited, given that the commentaries were not off-tube (except in relation to a short period in early 2017). Again, this was addressed by the Applicants, in the form of a draft order produced on the day of the hearing.
Are the changes to the application fatal to it?
CPR Part 31.16(3)(a) and (b)
CPR Part 31.16(3)(c)
"…I regard the ambit of the disclosure sought as wide and woolly. Mr. Eder suggested that if there were flaws in the application notice then they could be dealt with after this judgment. I do not regard that as satisfactory. It is, I think, important, if not essential, that every application for pre-action disclosure should be crafted with great care, so that it is properly limited to what is strictly necessary…"
"The First, Third and Fourth Respondents shall each give disclosure and inspection of the following documents within 7 days of this Order:
a. documents evidencing the details (including the card number, the identity of the subscriber, and the date of the subscription) of each Sky TV viewing card which has been used for the production of Commentaries;
b. documents evidencing the location(s) at which each such card has been used since 1 January 2017, and the details of any change in location(s);
c. copies of the Sky subscription terms and conditions applicable in respect of each such card;
d. documents evidencing the identity of each commentator engaged by any of those Respondents to produce and/or facilitate the production of Commentaries, and their employer (if any);
e. copies of the terms on which any of those Respondents have engaged each such person and/or entity."
CPR Part 31.16(3)(d)
i) At the first stage – the jurisdictional stage – "the court is only permitted to consider the granting of pre-action disclosure where there is a real prospect in principle of such an order being fair to the parties if litigation is commenced, or of assisting the parties to avoid litigation, or of saving costs in any event": Black at  per Rix L.J.
ii) At the second – discretionary – stage – "the court should go on to consider the question of discretion, which has to be considered on all the facts and not merely in principle but in detail": Black at  per Rix L.J.
i) Dispose fairly of the anticipated proceedings;
ii) Assist the dispute to be resolved without proceedings;
iii) Save costs.
i) To enable the Applicants to commence proceedings not merely against entities within the Ladbrokes/Coral Group, but also against the commentators used by the Ladbrokes/Coral Group to produce their off-tube commentaries during January and February 2017.
ii) To enable the Applicants to plead more specifically what they can, already, plead, namely that the off-tube commentaries were produced using a subscription from Sky to "At the Races", which conduct was arguably in breach of the Sky subscription terms.
i) If these proceedings are commenced – as, clearly, they can be – there will doubtless be need for interlocutory argument about the pleadings and disclosure. I do not consider that there is any real prospect that granting this application would render the proceedings any less expensive or protracted.
ii) Indeed, I consider that there is a real prospect of this application protracting the proceedings, and making them even more expensive. As I have already indicated, I would not have been minded to grant the applications as framed. Had I granted them, it would have been on the basis of a tightening of the classes of document sought. There would, therefore, have been further time and cost spent in ensuring that the applications – in terms of the pre-action disclosure sought – were precisely and properly drawn. Then, time would have to be allowed to enable the Ladbrokes/Coral Group to produce the pre-action disclosure ordered.
iii) Not only would this cost time and money (I appreciate, but discount, that the cost of pre-action disclosure would not be for the respondent: my focus must be on the overall costs of the proceedings), but it would also serve to delay the issue of proceedings by the Applicants. To my mind, the single most important step, in terms of fairness, achieving settlement and for the saving of costs is for the Applicants to put their claim, properly pleaded, so that the Ladbrokes/Coral Group know where they stand, and can respond appropriately.