British RCA/attheraces Tiff Could Get Ugly

18 February 2004

Two weeks after attheraces and the Racecourse Association (RCA) severed their ties, reports that both sides could be contemplating legal action have surfaced.

"The RCA is firmly of the view, and has been advised to that effect, that attheraces is not entitled, in the circumstances, to terminate the agreement."
- Stephen Atkin
The Racecourse Association

attheraces, the British racing consortium comprised of Arena Leisure, BSkyB and Channel 4, announced late last month that it will cease broadcasting races at the RCA's 49 racecourses on March 29. The move came after attheraces' combined proceeds from the tracks fell below contractual obligations.

By giving 60 days notice, attheraces said it would begin negotiating with individual tracks, leaving the RCA out of the picture.

This week, both the RCA and attheraces indicated that the next two months could make for some interesting give and take.

Officials with attheraces said some talks with individual tracks are going well, but hinted that there might be some collusion between the RCA and other tracks preventing attheraces from making progress.

Meanwhile, although no official comment has been made, the British media are speculating that the RCA could turn to the courts to recoup some of the profits it will lose through the termination of the £307million, 10-year agreement.

Stephen Atkin, the chief executive with the RCA, informed member tracks this week that, "The RCA is firmly of the view, and has been advised to that effect, that attheraces is not entitled, in the circumstances, to terminate the agreement."

To that end, the RCA said it was distancing itself from the talks between attheraces and the individual tracks and was taking a "safety first" approach, according to Atkin.

Officials representing the three consortium partners said they would continue to seek new agreements with individual tracks and if new terms couldn't be reached by the March 29 deadline, they would seek compensation from the RCA.

Atkins claims that while the initial agreement called for the plan to be re-worked if Tote revenue fell below 20 percent for 90 straight days (which it did), it didn't mean the two parties had the right to terminate the deal.

"attheraces was under an obligation to negotiate in good faith to resolve that subject," he said. "Instead they choose to seek a better agreement for them that didn't involve the RCA."

The situation got worse, Atkin said, when attheraces refused to allow an independent assessment of its books. The idea was to study the books, from an independent source, so an amicable result could be reached for both parties.

Officials with attheraces said the RCA claims were baseless and countered that the racing group refused to enter into meaningful talks over the contract, thus forcing it to go ahead with the termination notice.

Despite the potential conflict, Atkins said he still hopes the RCA and attheraces can reach a new agreement.

"For the good of all members and for horseracing as a whole, we will continue to press attheraces to adopt a more reasonable position," he said.

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