Sportswear brand Elite Sports Group seeking £9.5m from Rangers wins legal discovery bid

A sportswear brand suing Rangers in a multi-million pound action has won a bid to discover how many kits made by a rival have been sold to fans.

Lawyers acting for Elite Sports Group Ltd persuaded judge Lord Braid to pass an order which forces the Glasgow side to disclose sales data to them.

Elite are the exclusive brand partner to Danish sportswear firm Hummel and it has instructed lawyers to go to the Court of Session in Edinburgh.

The company is seeking £9.5m compensation from Rangers.

Its lawyers claim the club breached a contract which allowed the firm to provide the Glasgow team with kits.

Lawyers for Elite say the breach occurred when Rangers signed a deal with Castore, a Manchester-based brand which counts tennis ace Sir Andy Murray as one of its investors.

On Wednesday, Elite’s lawyer David Thomson KC said his clients should be granted access to how many team kits made by Castore have been sold.

Mr Thomson told Lord Braid that he and his colleagues needed to see such information as it would help them prepare their case and see how much they should claim for in compensation.

He told Lord Braid: “It is the pursuer’s case that the rug was effectively pulled from under them. It is clear that Rangers entered into an agreement which they didn’t perform.

“The amount being sought is currently based on an estimation of sales. If the relevant figures are produced it will allow the claim to be more specific.

“I would ask the court to allow my motion for commission of diligence.”

The case being brought by Elite arises from a separate legal dispute involving Sports Direct, which was then owned by Mike Ashley and Rangers.

Lawyers for Ashley’s firm went to the High Court in London seeking an injunction to stop the deal between Elite and Rangers from going ahead.

The deal, which was signed in October 2018, was supposed to allow Hummel to supply the ‘Gers with kits and to sell replicas to fans.

However, Judge Lionel Persey QC found that the deal with Hummel, to be a three-year contract worth £10m, was undertaken without giving Sports Direct a chance to match it.

Judge Persey ordered that Rangers couldn’t “wear any Official Rangers Technical Products designed by, supplied by, gifted by or manufactured by Elite or Hummel, or bearing the Hummel brand”.

Castore is the official technical kit partner of a number of leading teams and athletes including Rangers, McLaren Racing, Newcastle United, England Cricket, US Open Champion Matt Fitzpatrick and Andy Murray. The brand sells into more than 90 countries globally and was valued as being worth £750m in September 2022.

On Wednesday, Mr Thomson told Lord Braid that Rangers said to Hummel that it couldn’t continue with their contract.

He said the club then signed a deal with Castore in May 2020 and that this deal breached the terms of the Hummel one. The agreement was reported to be worth £20m and covered five seasons.

Mr Thomson said the new deal caused Elite to sustain losses which it needed to be compensated for.

He told the court that the figures currently being sought by his clients were based on a report compiled by an expert who works for Deloitte, a financial services company.

He said he needed the actual sales figure from Rangers to help prepare his case.

Gavin MacColl KC for Rangers asked Lord Braid not to grant permission for the Castore sales figures to be released. He said the deals differed in nature and this meant the figures couldn’t be released.

Mr MacColl added: “The contracts are materially different. Castore have a substantial[ly] larger number of rights than the pursuer. They are able to sell a greater number of products.

“They operate in a different manner. They are Rangers’ full retail partner. Castore are a sports retailer and a sports manufacturer. They are not comparable business models.”

Lord Braid allowed Mr Thomson’s motion to be granted.

He added: “I accept Mr Thomson’s submission that it is relevant to look at what the market was and the sales figures for Castore.”

The case will call again sometime in the near future.