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Thursday, October 14, 2010

International Corporate Warfare in Real Time

Whether or not you are a scouser, I would encourage you to go to this page right now -- now! -- to experience the thrill of international corporate warfare in real time.  Yesterday a British court ruled that the board of Liverpool Football Club had the power to go through with its sale of the club to the folks who own the Boston Red Sox.  I say the "board," although that was part of the dispute, as the owners -- two Americans, including the former owner of the Texas Rangers -- had changed the composition of the board in breach (as the U.K. court found) of an agreement with UBS, who had lent them £200m.  If this is all a bit much to figure out, then add in a late-breaking TRO from a Texas trial court judge enjoining the sale!  Today the parties are back in U.K. court, and there could be a verdict as I am writing this now.  If the sale doesn't go through today, UBS can take over the club tomorrow, which will cripple LFC's standings in the Premier league.  So check out David Zaring's piece from yesterday for background, and keep hitting "refresh" at the Guardian's site.  And feel free to email the Guardian's reporters if you have any in-depth knowledge about Texas civil procedure.

UPDATE:  Mr Justice Floyd is back, but a decision is still pending.  Tough to take!  And I'm wholeheartedly in the board's camp.  I've been brainwashed, perhaps, by things like this.

UPDATE 2: From the Guardian blog:

5.21pm: Judge rules that anti-suit injunction wanted by RBS and other parties (board) against owner's action in Texas is granted. "This case has nothing to do with Texas."

If anyone with international civil procedure expertise would like to weigh in on what happens next, I'd be much obliged.

Posted by Matt Bodie on October 14, 2010 at 11:45 AM in Corporate, Current Affairs | Permalink

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Comments

Anonsters,

Liverpool is an English team, located in England.
It plays in the Premier League, the leading English football [soccer] league.
The team does not play in the United States.

Liverpool's players are all in England.
Its coaches are all in England.
Its staff is all in England.
The bank financing the team is the Royal Bank of Scotland.

Hicks and Gillett used the British court system in an attempt to block the sale of the Liverpool team. They lost.

That’s when they decided to complain to a court in Texas. And whined when a British court then determined that Texas law does not apply in the case.

As counsel for RSB stated:
"This dispute involves an English football club and three English companies and has no connection with Texas other than that Hicks and Gillett may reside there."

More info here.

Posted by: us-ukfootballfan | Oct 15, 2010 10:15:32 AM

The anti-suit injunction is a time-tested (though not always honored) device.

http://en.wikipedia.org/wiki/Anti-suit_injunction

Basically, it is a way for a court to protect itself. Hicks already agreed (by litigating) that the UK court was the proper forum to hear his case on the merits. Just because he's now dissatisfied with the result does not entitle him to "forum shop" to seek a different result.

In this case, an English court is enjoining Americans from trying to weasel out from a result they submitted themselves to by seeking relief in an American court.

This isn't even a very close case. Hicks chose to fight in England and lost. He doesn't get to take his ball and go home.

/American civil litigator, not a professor

Posted by: Craig Esherick's Mustache | Oct 15, 2010 5:13:50 AM

We need to get a civ. pro. prawf's take on this, as it appears to be headed to silly-town, now that (according to the Grauniad): "5.21pm: Judge rules that anti-suit injunction wanted by RBS and other parties (board) against owner's action in Texas is granted. 'This case has nothing to do with Texas.'" So an English court is enjoining Americans from seeking relief in an American court (and apparently ignoring the Texas injunction). Wha?

Posted by: Anonsters | Oct 14, 2010 12:32:43 PM

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