CHIA-HSING WANG v FLOREAT PRIVATE LIMITED
[2023] EWHC 1123 (Comm)
SportsDirect.com Retail Limited v Newcastle United Football Club Limited & Anor
17 May 2024
[2024] EWCA Civ 532
Court of Appeal
Sports Direct sued Newcastle United for stopping the supply of football kits, claiming unfair competition. A lower court refused to immediately force Newcastle to supply the kits. The higher court agreed that the lower court made a mistake in its initial assessment, but still refused to force Newcastle to supply the kits because it would cause more problems for everyone involved. The higher court allowed Sports Direct to continue their case.
Key Facts
- •Sports Direct applied for a mandatory interim injunction against Newcastle United for ceasing supply of replica football kits.
- •Newcastle United entered into an exclusive sales agreement with JD Sports.
- •Sports Direct alleged abuse of dominant position and anti-competitive agreements under the Competition Act 1998.
- •The Competition Appeal Tribunal (Tribunal) dismissed Sports Direct's application.
- •The new season's replica kit launch was imminent (June 7th, 2024).
- •The dispute involved the sale of Newcastle United and a change in merchandising strategy.
- •The Tribunal found no serious case to be tried but ordered a speedy trial.
- •Disagreements existed on the applicable test for abuse of a dominant position (material effect vs. elimination of competition).
Legal Principles
Test for granting interim injunctive relief (American Cyanamid test)
American Cyanamid Co v. Ethicon Limited [1975] 1 AC 396
Abuse of dominant position under Section 18 of the Competition Act 1998
Competition Act 1998, Section 18
Chapter I Prohibition (agreements restricting competition) under Section 2 of the Competition Act 1998
Competition Act 1998, Section 2
On an application for an interim injunction, the court must take the claimant’s pleaded and evidenced case at face value, unless it is shown to be plainly false or fanciful.
Case Law (implied)
Test for abuse of dominant position: material effect on competition (Burgess, Purple Parking, Arriva) vs. elimination of effective competition (Microsoft)
Burgess v. Office of Fair Trading [2005] CAT 25; Purple Parking v. Heathrow Airport [2011] EWHC 987 (Ch); Arriva v. London Luton Airport [2014] EWHC 64 (Ch); Microsoft Corp v. Commission of the European Communities (Case T-201/04) [2007] ECR II–3601
Outcomes
Appeal dismissed.
While the Court of Appeal found the Tribunal erred in not finding a serious case to be tried, the balance of convenience favoured refusing interim relief. The Tribunal correctly assessed the balance of convenience, considering the potential harm to both parties and the complexity of policing an injunction.
Permission to appeal granted.
The apparent inconsistency in the Tribunal's decision (finding no serious case but ordering a speedy trial) and its inappropriate approach to the facts warranted granting permission to appeal.
Similar Cases
Allergan PLC & Ors v The Competition and Markets Authority
[2024] EWCA Civ 1023
Enreach UK Limited & Anor v Inreach Group Limited
[2024] EWHC 1303 (Ch)
Mimo Connect Limited v Matthew Robert Buley & Ors
[2023] EWCA Civ 909
Credico Marketing Limited & Anor. v Benjamin Gregory Lambert & Anor.
[2023] EWCA Civ 262