NEW BALANCE HIGH COURT CLAIM AGAINST LIVERPOOL DISMISSED

The High Court has today dismissed New Balance’s legal claim against Liverpool Football Club. The decision means that the Reds are not obliged to continue their relationship with New Balance and are now free to proceed with the new link-up with Nike.

New Balance took the Reds to court over their refusal to honour the terms of its reported £40million-a-year kit deal which expires in May. New Balance insisted that they were entitled to renew their sponsorship with the Reds due to a ‘matching clause’ in their existing deal which was related to matching the terms of any competitor’s offer. Liverpool, however, argued that New Balance couldn’t match Nike’s offer in relation to the marketing and distribution of Liverpool products. The Nike deal only guarantees Liverpool £30million-a-year but Anfield executives believe that further royalties linked to distribution and promotion would see additional revenues banked.

An independent review into New Balance by Deloitte which was commissioned by the Reds, determined that Nike could provide distribution through “6000 global doors”, double that of New Balance and that a deal with Nike would “super charge distribution in a way challenger brands are not able to do.”

A clause in the Nike deal which involves ‘Big Guns’ such as LeBron James, Serena Williams and Drake promoting Liverpool’s kit was extremely important and had that not been included, New Balance may have been successful with their claim.

Judge Teare’s written judgement said: “In my judgement the calibre of the named athletes or influences can be measured … I accept that the calibre of the named athletes can be measured in a number of ways but it would be unrealistic (and contrary to the evidence in this case) that their calibre can not be measured.

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“I have therefore concluded that the New Balance offer on marketing was less favourable to Liverpool FC than the Nike offer because Liverpool FC cannot require New Balance, on the terms of its offer, to use global superstar athletes of the calibre of LeBron James, Serena Williams and Drake.

“It must follow that Liverpool FC is not obliged to enter into a new agreement with New Balance upon the terms of the latter’s offer.”

Daniel Oudkerk, QC, representing New Balance, requested permission to appeal but this was dismissed by Judge Teare who said: “I am not persuaded there is a real prospect of success.”

A spokesman for Liverpool Football Club said: “Liverpool FC is pleased with the Judge’s decision to rule in favour of the Club following the legal dispute with our current kit supplier, New Balance.

“We will continue with New Balance for the current season, in combination with preparing next season’s Liverpool kits with our new supplier.”

New Balance had already designed 3 new kits for Liverpool for the 2020-21 season.

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