Sports Direct has withdrawn its legal case against Rangers FC following repeated failures to keep the details of its contract with the club from the public domain.
Last summer, an interim gagging order was placed on Rangers to stop the club from discussing its retail arrangement with Sports Direct. Since then, the sports retailer has consistently attempted to have this extended. Recently the company tried, and failed, to have Rangers Chairman Dave King arrested for contempt of court for discussing the deal publicly.
Agreeing to abandon the case, High Court Judge Mr Justice Peter Smith called it a “ridiculous piece of litigation”, and has allowed Rangers to openly discuss elements of the agreement that are already in the public domain.
“From start to finish, [the request to imprison King] was designed to intimidate rather than seek a proper sanction for an alleged breach,” Smith said. “It was a muscular tactic using the threat of committal that the court should deplore.”
Rangers fans have long protested the deal, which was found by The Guardian to be riddled with extreme and consistently one sided clauses that grant huge benefits to Sports Direct at the club’s expense. These include the requirement of a seven year notice period to end the contract, an obligation for Rangers Retail to purchase stock at a “higher cost than its retail value”, and even a clause that allows Sports Direct to force the club to give up its stake in Rangers Retail if the working relationship between it and Ashley’s company becomes “deadlocked.”
According to The Guardian, Rangers has made only 4p for every pound spent in its Ibrox store.
“Rangers are pleased that Sports Direct have today discontinued their claim for a permanent injunction… Fortunately, the judge has been alive to the ‘game playing’ of Sports Direct, which has helped to expose the case for what it is,” said Ryan Mowat, a Partner at Rangers’ law firm, Kingsley Napley.
It remains to be seen whether fans will get their wish that the contract be renegotiated, but with the steam of bad publicity Sports Direct has faced since December, it is unlikely that Mike Ashley will be attracting any sympathy for his side.