Monday 19 March 2018

Ex-Liverpool owners get trial

Brian Farmer

TWO American businessmen who used to own Liverpool Football Club should be allowed to air grievances with bank bosses at a trial, a British High Court judge has ruled.

Mr Justice Peter Smith said it was questionable whether the Royal Bank of Scotland (RBS) had "truly distanced itself" from the "process" when the club was sold two years ago.

And he said former owners Tom Hicks and George Gillett should be given the chance to have evidence tested in the High Court.

The judge said he hoped that a trial could take place early in 2013.

Mr Justice Peter Smith's decision - announced in a written ruling - is the latest stage in legal action launched after the club was sold in 2010.

Mr Hicks and Mr Gillett claim that the club was sold at a "substantial undervalue" and said RBS "deliberately" blocked their attempts to "refinance".

In March, RBS bosses asked the judge to declare them not guilty of "any dishonesty or corruption" at a High Court hearing in London.

Lawyers representing RBS said Mr Hicks and Mr Gillett had alleged a "grand conspiracy" but failed to produce "any evidence".

Liverpool was sold to New England Sports Ventures - headed by American businessman John W Henry - in a £300 million deal in October 2010.

Mr Hicks and Mr Gillett tried and failed to block the sale.

"RBS's contention... is that in April 2010... the former owners agreed to a structure of the group which involved them giving up control," Mr Justice Peter Smith said.

"They deny that they owed any obligations as regards giving the former owners opportunities to refinance.

"RBS contends that an examination of the internal documents relied upon by the former owners show that it had no role in the sale that took place."

The judge added: "The former owners' contention is that in reality... RBS controlled everything.

"As part of that exercise, RBS was determined to remove the former owners from the control of Liverpool FC.

"This, the former owners contend, was because RBS believed that would give them kudos in the eyes of the public, whereas its continued involvement with the former owners would operate negatively on its reputation.

"The former owners contend that the opportunities to refinance were frustrated by RBS deliberately to achieve this ulterior purpose."

Mr Justice Peter Smith said he had concluded that it was a matter which ought to go to trial.

"There is in my mind a question as to whether or not RBS truly distanced itself from the sale process," the judge said.

"In reality, what actually happened between April 2010 and October 2010 can only be discerned by a trial when the relevant players give evidence and their evidence is tested by cross-examination in the light of the contemporaneous documents."

He added: "In my view, it would be wrong and a denial of justice potentially at this preliminary stage to deny the former owners an opportunity to have a trial on this issue."

Mr Justice Peter Smith went on: "This matter should be brought to a speedy conclusion.

"I would wish directions to be agreed if possible with a view to this action... being heard early in 2013."

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