Thursday, October 14, 2010

"This case has nothing to do with Texas." - So now what for Liverpool Sale?

A Liverpool supporter stands outside the High Court in London October 13, 2010. Premier League side Liverpool inched closer to a sale on Wednesday when a High Court judge ruled against their unpopular American owners and backed the club's board and its right to negotiate a deal.  REUTERS/Stefan Wermuth (BRITAIN - Tags: SPORT SOCCER BUSINESS)

Here's my quick response to the latest news coming out of England regarding the legal drama concerning the sale of Liverpool FC. Today, the High Court in England has determined that the Texas courts do not have jurisdiction over the matters surrounding the sale of Liverpool FC. Here's the latest coverage of the High Court's proceedings from England:

The Guardian

The Telegraph

The Independent

So does this mean the Royal Bank of Scotland and the other defendants can just ignore the temporary restraining order and move forward with the sale of the club as planned? In reality, "No."

If they move forward with the sale without getting the TRO lifted, they still risk being in contempt of court.

Since we're dealing with two courts located in two separate countries, as of now, nothing that has been issued by either court has truly overruled what the other court has done. At this point all parties involved need to be careful about violating any of the court orders that have been issued by the two courts, until one of the courts cede's authority to the other court.

So what happens now?

The defendants in the Texas case are going to have to get the TRO lifted so that they can move forward with the sale without being in contempt of the TRO - the High Court can't lift the TRO, only the Texas court can do that. The defendants will submit the orders from the High Court to the Texas court and seek to have the Texas court recognize these orders as valid. There is a process for this, which I don't have time to really delve into at the moment. Just know that there are means of getting foreign court judgments/orders recognized in Texas courts.

As I mentioned in a prior article, Texas law usually requires 3 days notice for a hearing. Under that rule, Monday would be the earliest day to have a hearing. That being said, the defendants can still try to get the matter on Friday's court docket - by doing that it would mean the 3 day notice issue could be a basis for some kind of appeal, if things get that far.

At this point, I still think we're looking at a delay in the sale of the club. But we'll keep watching and see what other legal maneuvering occurs.


It is my understanding that there is a hearing set to occur in the Dallas court today. I suspect this might have to do with the earlier talk that Hicks and Gillett's team were seeking to have the court find the defendants in contempt of the TRO. It is possible that the defendants' legal counsel will be present at this hearing and take it as an opportunity to get the TRO lifted. We'll see what happens.

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