The equestrian sport of show jumping takes place across the world, attracting an ever-increasing media profile. It therefore comes as little surprise that event organisers have sought to ride the wave of the sport’s growing interest and publicity by seeking to establish various new show jumping competitions.
Two such leagues are Major League Show Jumping (“MLSJ“), which debuted in 2021, and the National Equestrian League (“NEL“), which is still yet to launch (despite having been approved by the Fédération Equestre Internationale (“FEI“)).
The advertised potential prize money on offer for these new leagues is considerable: $12,400,000 for the NEL; and $7,000,000 for the MLSJ. These leagues both feature eight professional teams, which compete at various venues across North America. They are both classified as 5* show jumping events and are seemingly looking to mirror the structure of established American major professional sports leagues.
The rivalry between the MLSJ and proposed NEL progressed to the US courts and the tribunal for the FEI, and this article sets out the background to the legal challenges and various issues under consideration.
- Jumping Clash SL and National Equestrian League LLC (the “Plaintiffs” / “Appellants“) claim that they spent 9 years (from 2011 to 2020) developing the “National Equestrian League“;
- From October 2018 to March 2020, the founders of Jumping Clash SL and National Equestrian League LLC consulted with Morrissey Management Group (“MMG“), an equestrian events management agency, with a view to bringing the NEL to launch;
- The NEL competition format was, as reported in FEI tribunal documentation, approved by the FEI in 2019; and
- Meanwhile, MMG developed MLSJ and this was subsequently approved by the FEI in 2020.
Nature of the Litigation
In April 2020, the Plaintiffs filed a complaint against MMG, Major League Showjumping LLC and others, including Angelstone Farms Inc, (“Defendants“) in the Federal Court of the Southern District of Florida. The Plaintiffs alleged various claims against either some or all of the Defendants. These claims included, amongst others: copyright infringement of the format and modality of the NEL; and breach of contract for using confidential information and intellectual property pertaining to the NEL to set up the MLSJ.
The Defendants responded raising various defences collectively, with Angelstone Farms Inc also asserting counterclaims.
Both the Defendants and Plaintiffs have at various stages sought to dismiss the other’s claims. Such attempts have largely been denied by the court. Most recently, on 24 January 2022, the Defendants filed an unsuccessful motion to stay proceedings in light of settlement discussions over the Christmas and New Year period. This motion was denied by the judge on 26 January 2022.
As things stand, and unless a settlement is reached, the trial is due to commence on 6 June 2022.
In accordance with Article 162 of the FEI’s General Regulations, a person or body with a “legitimate interest against any Decision [by an authorised body or person]” may lodge an appeal with the FEI Tribunal. Decisions by the FEI Tribunal may then be appealed to the Court of Arbitration for Sport (“CAS“).
The Appellants appealed the FEI Board’s decision to approve the MLSJ to the FEI Tribunal, arguing that it was “arbitrary and grossly erroneous.” In particular, the Appellants argued that the FEI Board should have, and failed to:
- comply with applicable FEI rules, regulations and policies (including the FEI Policy for the Approval of a Series);
- honour its own past practice;
- uphold the FEI’s ethics and values; and
- reach a decision based on substantial and credible evidence.
The FEI Tribunal dismissed the appeal and upheld the original FEI decision.
Last year, CAS’ List of Hearings showed that the Appellants subsequently appealed the decision, with such appeal due to be heard on 8 and 9 November 2021.
Under the CAS Code of Sports-related Arbitration, the final decision is due within three months following the transfer to the CAS panel hearing the appeal. As such, a final decision may well be published shortly (unless both parties have agreed for the decision not to be made public).
The above matters raise some interesting and relevant issues, particularly regarding the protection of rights in sports formats and the role of sports governing bodies in sanctioning new events and competitions. We shall await further developments both in the Florida courts and at CAS with interest.
At a practical level, the matter also highlights, on its facts, the importance of appropriate consideration, when drafting and negotiating service agreements (particularly strategic arrangements), of: (i) restrictions on the use of commercially sensitive information; (ii) provisions governing ownership of rights in work products developed in the course of the provision of services; and (iii) restrictive covenants.