Owen Evans spoke to leading lawyers to get a behind-the-scenes look at the sports law sector, find out what major issues have come across the desks of major firms in recent months, and identify what areas of the sports industry are changing so fast that the legal sector is struggling to keep abreast.
English Premier League broadcast rights, Financial Fair Play, third-party ownership, image rights…the areas of the sports industry where lawyers with a deep understanding of the legislative landscape across the world play
a pivotal role are near endless.
With more money in sport than ever, there is just as much to lose as there is to win. This is why lawyers play such a pivotal role, as they provide legal advice to help ensure the rules of sport are adhered to, the rights of participants are protected, competitions operate under the principles of fairness, sports administrators are held accountable to their stakeholders and rights are clearly defined and protected.
We spoke to the team of lawyers at The Sports Consultancy, which works with a wide spectrum of industry stakeholders from brands and host cities to rights-holders and venues. They explained which parts of the sports industry are breaking new ground for sports law practitioners and whether rights-holders should stay in-house, or look externally for legal advice.
Blake has more than 10 years’ experience advising clients in the sports, entertainment and media sectors. His current work includes managing the legal aspects of the Spanish Golf Federation’s bid to host the 2022 Ryder Cup, providing commercial assistance to the organisers of the Volvo Ocean Race, and advising on the tender process and drafting the host venue contract for the 2019 Basketball World Cup.
Becker joined the ICC (International Cricket Council) in 2007 as senior counsel and was promoted shortly after to head of legal. Over the last 15 years, David has advised a host of sports federations, athletes, rights-holders and brands across the world, including World Rugby (formerly the International Rugby Board), the International Sailing Federation, Nike and sailor Sir Ben Ainslie.
Alexander first gained experience in sports law through a secondment to LOCOG (the local organising committee for the 2012 Olympic and Paralympics Games in London). Her recent work includes advising the Isle of Man government on the launch of its tender to find a promotor and organiser for the Isle of Man TT Series, and advising the WTA (Women’s Tennis Association) on the appointment of Singapore as host of the WTA Finals.
Which areas of the sports industry are presenting challenges for sports lawyers?
David Becker: One of the challenges we have as practitioners is understanding how technology is influencing our work. Things like data protection, IP (intellectual property) and digital media are critical to some of the deals we underwrite and, as a result, it is critical we know all about them and keep up to date as the sports and entertainment sectors at large converge.
That is a challenge as we are now having to be more broad-minded as lawyers and think commercially about every new sector to be are aware of the latest legislation.
One area that’s a challenge for the industry is how to protect rights we don’t know exist yet
Ashley Blake: It is not a matter of avoiding any type of case or subject area, it is up to us to realise that we need to adapt to the needs of our clients. I don't think you can just be a standalone lawyer anymore and think that is enough – you need to have the industry knowledge to go with it.
That marriage of sports industry expertise with the technical skills of a good practitioner has become a prerequisite for anyone looking to become a successful sports lawyer now.
Holly Alexander: One area that is a challenge for the industry is how to protect rights that we do not even know exist yet.
Look at the area of broadcast technology and the rate at which it is developing. As an example, look at something like clip rights. Clips rights have been around for a long time, but until mobile platforms were developed, the true value of those rights were not known. Those rights, therefore, were being sold in the past without any idea of how valuable they would become in the future.
It is a challenge for commercial lawyers to anticipate such developments and build flexibility into contract terms – we do this by reading up on new technologies to try and stay one step ahead.
AB: The international environment of the sports industry means that there are new markets and opportunities opening up all the time, and we need to keep updated on the different cultural and legal landscapes.
DB: I agree – sport is a global industry now and we need to stay on top of it. To give you an example, a long-standing client of mine has hosted a successful event in the UK for many years, and now it is starting to see the potential of hosting it abroad; we have to be in a position to advise on exactly what the implications are for awarding international rights if the rights-holder wants to move the event into somewhere like south America.
Is having experts in every area of the industry the answer to running a successful sports law firm?
DB: Not necessarily. The all-encompassing view certainly helps when it comes to providing advice across the board, but I don’t think it is absolutely critical. Smaller firms that specialise in just one or two areas of sports law are doing just as well.
AB: I'd agree with that. I can also see why people go from working in-house to a private practice or part of a consultancy – there is a lot of value in that. I can see many law firms and consultancies heading that way as well.
However, as David said, I don't think a modern sports law firm needs to have an expert in every single area that, say, a major football club could possibly require advice on to survive. It's about being excellent at what you do, even if it is just confined to distinct areas of the law.
HA: Previously, we have seen many sports law firms and departments built around one individual who has an excellent reputation and has then been recruited by a major company for his or her contacts and expertise. So, especially in sport, it is not necessarily a case of needing to have major expertise across all the sectors of sports law, but rather a specialism in one area where you can make a name for yourself and create key relationships, alongside a good commercial awareness and an excellent knowledge of the sports industry.
What are the pros and cons for major sports properties having in-house versus external legal counsel?
AB: What we find when we work with major rights-holders, cities and other major sports organisations is that the size and nature of their in-house legal expertise varies according to the type and size of the organisation, and what legal work they encounter on a day-to-day basis. Some will have a fairly large in-house legal team consisting of between five and 10 people, some have one in-house lawyer and some do not have anything.
For example, international federations are likely to always have some in-house advisors to help them look after their everyday business, which will commonly involve looking at the regulatory and disciplinary issues that come up. However, they will always need external advisors for certain specialist advice.
Sports law firms are replicating what the big accountancy firms have done in recent years: they now consult, strategise and provide professional services
Any organisation that has an in-house team will always need external advice at some stage. You also have to remember that there will always be peaks and troughs in event cycles, so there may be times when in-house capacity is stretched.
DB: Certainly what we have seen in recent years is a move for more and more rights-holders to take their counsel in-house, simply because matters have become more complex from a legal perspective. Even small international federations need ongoing advice on issues such as governance and doping as sport gets more complex.
HA: One point to add to that is if a rights-holder owns a global property where they have a presence in multiple locations – that adds another layer of complexity for the in-house team. Looking at it from a global perspective, rights-holders can have extra flexibility by drawing on advice when it is needed in other locations, or can even have no in-house team but instead rely on a network of external advisors around the world who are ready to advise where needed.
Having worked on both sides of the fence, what are the weaknesses in having in-house counsel?
DB: For me and relating to my previous role as head of legal at the ICC, there were certainly times when we really needed external advice, in particular in the area of litigation.
Rights-holders can have no in-house team now, instead relying on a network of external advisors around the world
AB: Budgets are always an issue as well, but I think there will always be the need for external advice. It's not just about specialist skillsets: you can sometimes have four or five excellent legal advisers in an in-house team, however sometimes it is invaluable just to take in some independent legal advice from someone outside the organisation.
In some instances it is not about simply looking at the legal aspects, but good external advisors are able to apply their experiences with other sports to offer an independent perspective on commercial and strategic aspects.
DB: You always want to manage your own resources as best as you can, but you have to allow for the fact that you will need some external help at some stages as well. There are ups and downs for rights-holders that are involved with the cycles of major events.
AB: Even if you have a decent-sized in-house team, you cannot always be staffed for when all the commercial deals need to be arranged, negotiated and signed-off in the same period. The in-house team is going to be flat-out and not have time for its day-to-day tasks.