The CAT got it - accidental disclosure of privileged e-mail

In a recent decision Sportradar AG -v- Football DataCo Limited (CAT ruling [2022] CAT 29), the Competition Appeal Tribunal (CAT) clarified the issue of privilege in documents inadvertently disclosed to an opponent where one party alleged that the document was disclosed by mistake and was protected by privilege, whereas the other party did not consider it to be privileged and sought to rely on its contents in proceedings.

Facts

Sportradar AG and Sportradar UK Limited (Sportradar) commenced proceedings in the Competition Appeal Tribunal for damages under S.47A of the Competition Act 1998 against Football DataCo Limited (FDC) and BetGenius Limited and Genius Sports Group Limited (Genius).

FDC and Genius subsequently commenced High Court proceedings against Sportradar claiming breach of confidence and breach of statutory duty relating to certain trade secrets which itself raised competition law issues which were referred to the CAT to be heard. The CAT ordered that there was to be a joint trial of the competition law issues and the claim for an injunction relating to the breach of confidence claims proceeding in the High Court. 

It was further ordered that a single disclosure exercise would apply to both the CAT and High Court proceedings. 

As part of the disclosure exercise, FDC disclosed to Sportradar and Genius an email between an employee of FDC and an employee of Genius which was marked without prejudice in a redacted form but also the same email in an unredacted form attached to a Board Report. 

The email contained commercially sensitive information:

• Referring to the contractual arrangements between FDC and Genius (by which FDC granted Genius the exclusive right to collect, collate and distribute live match data directly from certain football events for betting purposes) as being subject to a three-year break point and which noted was to be important to Genius.
• It proposed a deal by which FDC would not exercise its upcoming three-year termination right in return for Genius’s agreement to certain items, (including the terms of an indemnity between FDC and Genius (which had been the subject of disagreement between the parties) and a number of commercial points relating to the litigation with Sportradar). Genius was being asked to agree to all of the items as a condition of the deal.

In subsequent correspondence Genius alleged that the email should have been redacted by FDC’s lawyers on the basis of without prejudice privilege held jointly by Genius and FDC, or common interest privilege. FDC’s solicitors confirmed that the entire email was privileged and that the document was produced inadvertently and sought its return and replacement with a redacted copy.

Issues for the CAT

The parties were unable to resolve the issue and the following questions came before the CAT:

1. Whether the email was covered by without prejudice privilege, in circumstances where the communication contained a number of commercial issues as well as the indemnity issue.
2. If the aim of the email was to reach an agreed position on the indemnity issue, whether that issue matured into a dispute sufficient to establish the without prejudice privilege.

In a useful restatement of the law, the CAT clarified the scope of without prejudice privilege:

1. Without prejudice privilege is founded on the public policy of encouraging litigants to settle their differences. It is a rule about admissibility, excluding all negotiations genuinely aimed at settlement from being given in evidence. The privilege applies to oral or written communications in such negotiations.
2. The fact that a document is headed without prejudice indicates that the author intended the document to be treated as part of a negotiating process in which admissions might be made but is not conclusive as to the document’s status.
3. The rule does not just apply to protect negotiations aimed at resolving legal issues. Provided the criterion of ‘genuinely aimed at settlement’ is met, the nature of the proposals put forward or the character of the arguments to support them is irrelevant.
4. In relation to the likelihood of litigation, the test is ‘whether in the course of negotiations the parties contemplated or might reasonably have contemplated litigation if they could not agree.’

Decision of CAT

It was held that the email was subject to without prejudice privilege in its entirety. Accordingly, Sportradar was not entitled to use any of its contents. What was the rationale for this? The CAT found that there had been a dispute between FDC and Genius about the indemnity provision. This issue was settled alongside FDC giving up its right to terminate the contract. The offending email could be viewed as part of a negotiation which was genuinely aimed at settlement of, among other things, the indemnity issue. That was consistent with the labelling of the email which, while not determinative, was a strong indication that it was created in an attempt to settle matters in dispute between the parties.

As to whether there was a dispute sufficient to give rise to without prejudice privilege, the CAT noted that, the test was ‘not to be confused with the test that applies to the application of litigation privilege. It is an objective assessment of whether the parties have contemplated or might reasonably have contemplated litigation if they did not agree.’ Here there was sufficient evidence to conclude that this test was met and that ‘that the Indemnity issue was one which the parties might reasonably have contemplated litigating if they had not agreed to resolve it.’.

Key-points

The importance of heading documents without prejudice remains the most effective way of establishing that the author intends the document to be treated as part of a negotiating process in which admissions or concessions might be made but this is not always conclusive as to the document’s status. What is clear is that the negotiation has to be a genuine attempt to settle the dispute and whilst unrelated commercial mailbe protected by the without prejudice principle and be inadmissible in any proceedings. 

For further information on this topic, please contact Moya Clifford.