x Abu Dhabi, UAEFriday 21 July 2017

UK judge rules against Liverpool's US owners

Contempt of court threats on both sides of the Atlantic as fate of the Premier League club hangs in balance.

The dramatic events surrounding Liverpool’s potential takeover look set to continue in London’s courtroom.
The dramatic events surrounding Liverpool’s potential takeover look set to continue in London’s courtroom.

LONDON // A British judge granted an injunction yesterday against the Liverpool owners that could clear the way for the club’s sale to the parent company of the Boston Red Sox baseball team.

The High Court judge, Christopher Floyd, issued an order against the legal action taken in Dallas by American co-owners Tom Hicks and George Gillett Jr.

Hicks and Gillett’s companies, meanwhile, filed a motion in Dallas asking that the Royal Bank of Scotland, New England Sports Ventures and Liverpool’s independent board members be held in contempt and jailed.

Hicks and Gillett had obtained a temporary restraining order on Wednesday blocking the £300 million (Dh 1.75billion) sale to New England Sports Ventures.

The British judge ordered them to withdraw their action by 4pm London time today or be held in contempt of court.

The Texas District Court judge, Jim Jordan, declined comment in Dallas when informed about the injunction in England.

David Chivers, the NESV lawyer, said the sale would go through once the Texas case is withdrawn. “We are the owners (of Liverpool),” Chivers told the High Court.

The British judge said the legal action in Texas amounted to “unconscionable conduct on the part of Mr Hicks and Mr Gillett”.

“This case has no real connection to Texas,” Floyd said. He criticised Hicks and Gillett for not telling the Texas court that the High Court in London had ruled against them earlier on Wednesday in their attempts to block the sale. “It’s a deliberate omission not to mention the fact,” Floyd said.

Despite the restraining order issued from Texas, the Liverpool board voted on Wednesday for the second time to approve the sale to NESV.

Richard Snowden, a lawyer representing Royal Bank of Scotland – which controls Liverpool’s debts and has been trying to get the sale approved – told the High Court that the Texas ruling was “inappropriate” and should have no bearing on the case.

“The Texas court seems to have been told remarkably little about the proceedings in this court,” Snowden said. “This is the most outrageous abuse of process ... the proceedings in Texas are plainly inappropriate. This dispute concerns an English football club and their English companies. It has nothing to do with Texas other than the fact that Messrs Hicks and Gillett may reside there.”

The legal wrangling continued on both sides of the Atlantic as Hicks and Gillett’s company filed a motion in Dallas asking that the Royal Bank of Scotland, NESV and Liverpool’s independent board members be held in contempt and jailed.

“Further showing their unlawful intentions and brazen disregard for their obligations, defendants have undisputedly – and, according to their statements, quite proudly – violated this court’s temporary restraining order,” the motion said.

Debts and liabilities resulting from Hicks and Gillett’s leveraged purchase of the club three years ago have grown to around £285m, which is owed to RBS and Wells Fargo and is due by today.