Saturday 14 December 2019

Fist-pumping and cheers as judge slams Americans

Ian Herbert

IT was 10.48 in Court 18 when Christian Purslow, the Liverpool managing director whose Harvard education had surely prepared him for none of this, could finally lean across to his chairman Martin Broughton and shake his hand. He had already hidden two punched fists of triumph under his chin.

Though Slaughter & May solicitors will have offered both men the same legal advice as that reported seven days ago – that George Gillett and Tom Hicks' legal case was doomed if they really had signed over to Broughton the right to sell the club – you can never count anything out with those two. That's why Purslow admits he did not sleep well on Tuesday night.

He need not have worried. Mr Justice Floyd delivered what by legal standards was a stinging and punishing rebuttal of Hicks' and Gillett's case. The desperation of the Americans' legal representative, Paul Girolami, to argue that his clients had felt hurt and marginalised by the closet efforts to conclude the sale of the club on the quiet was writ large in the yellow post-it notes placed in front of him as he argued his case on the hoof.

The judge was more sure-footed. He used an obscure, 40-year-old piece of case law – about a man being locked out of his hotel room and suing the owners – to reach his conclusion that the Americans' perceived grievances should be given no hearing since they had illegally reconstituted the club's board in the first place to block the £300m sale to New England Sports Ventures (NESV).

“Wrongful acts are no passport to favour. We should see that the law is observed,” was the legal wisdom that emerged from that particular case.

The sport of football seemed most tangential to these proceedings – Liverpool “is an English Premier League football club” the judge intoned after the bustle of the packed chamber stilled at 10.03 and he began to speak. However, the footballing consequences of the current owners' attempt to filibuster the NESV deal into a position where the club's £237m debts are due and it risks administration were not lost on him.

“An event of this kind would result in nine points being deducted. There's no doubt that such an event would have a very serious effect on the value of the club,” the judge declared. The Americans' then tried to delay a board meeting until today. The judge declared it was to be no later than 8.0 last night and was, surprisingly, attended by potential new owner John W Henry.

In a last desperate bid to halt the sale, Hicks and Gillett then obtained an injuntion last night which said the directors were “acting merely as pawns of RBS, wholly abdicating the fiduciary responsibilities that they owed in the sale”.

Earlier, the judge contradicted Hicks and Gillett’s assertion that they had been excluded from the most thoroughly analysed Liverpool board meetings of all time which, minus Hicks and Gillett but including the two directors they had just sacked to stop them voting for NESV, gave the Boston Red Sox owners the green light last Tuesday.

Hicks and Gillett “would have been able to take part in the meeting,” the judge said. “They ceased of their own volition to take any part. The owners have released absolute control of the sale process, which they are now seeking to regain. When they saw that the process was going against them, they set out to renege on their agreement. There is no basis in the case that what they did is justified.”

Then, there was what Hicks and Gillett probably considered the unkindest cut of all: the closing debate over what court costs they should pay and how much leeway they should be given before signing undertakings to reinstate the directors they illegally suspended – Purslow and commercial director Ian Ayre.


Might the six-hour time lag between London and Dallas be taken into account, the judge pondered. “Well, they may well be up early,” replied barrister Richard Snowden, to general hilarity although the laughter may have subsided somewhat after the events from the other side of the Atlantic last night.

The pair must pay only standard 66pc damages, not the 100pc indemnity damages charged to defendants adjudged to have had no genuine case to make. But some of that money, for which they are personally liable, must go to NESV and that will sting.

And so, Liverpool's relationship with the Americans they took to heart and grew to abhor is almost over. Anthony Grabiner, Liverpool's legal representative who has rather stolen the show this week, left court to cheers, receiving them like a footballer might. By the time Broughton and Purslow had battled through the scrum, made a brief statement outside court and marched off, the chants of “We love you Martin, we do” and “One Christian Purslow” were echoing after them. (© Independent News Service)

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