Kicking Back: Football's Elite and the Importance of Intellectual Property

As I write, the honours in domestic football leagues across Europe have been decided and there is just the trifling matter of two continental trophies to dispute.

However, whilst most players and coaching staff are taking advantage of some downtime before the facing the exertions of pre-season training once more, summer is certainly not a relaxing period for those working in clubs' commercial departments.

This is, after all, when deals so vital to overall financial viability - and, in some cases, the prospect of long-term survival - are concluded.

For an idea as to how important commercial revenues have become in recent years, one only needs take a peek at what is widely considered to be the most definitive research on the financial health of football clubs.

The annual Money League study is compiled by the professional services consultancy Deloitte.

Its latest edition showed that during season 2021-'22, Europe's 20 biggest clubs grossed a total income of €9.2 billion (£7.88 billion) (https://www2.deloitte.com/uk/en/pages/sports-business-group/articles/deloitte-football-money-league.html).

Perhaps more intriguing was the revelation that only 15 per cent came from matchday sources, like the sales of tickets, food and programmes. More than twice as much (41 per cent) was the result of commercial activity.

More than being simply handy for the balance sheet, commercial income is vital to clubs harbouring serious ambitions of some of the game's biggest glittering prizes or those eyeing promotion.

That is because Financial Fair Play (FFP) rules devised by the European governing body, UEFA, and in place for the last 12 years mean teams can't spend more on players than they earn (https://documents.uefa.com/v/u/MFxeqLNKelkYyh5JSafuhg).

They apply to all, including Manchester City, who even as they celebrated winning the Premier League and the FA Cup, were in the process of contesting allegations of more than 100 breaches of FFP regulations over the course of nine years (https://www.skysports.com/football/news/11679/12804623/man-city-premier-league-charges-explained-what-are-they-what-could-punishment-be-whats-the-timescale).

Against all that backdrop, it is not a surprise that clubs value commercial success so highly and engage each year in extensive marketing campaigns to sell the latest replica kits (https://www.skysports.com/football/news/11095/12873641/premier-league-2023-24-club-shirts-kits-strips-new-home-and-away-jerseys-revealed).

Like any non-sports-based manufacturer, promoting extensive merchandise ranges is one thing.

Clubs also need to be alive to the challenges posed by pirates to their income streams. Although it might not appear to be an immediate concern, defending their intellectual property is as important as defending an on-pitch set-piece.

That is arguably most true for those clubs which have a large global fanbase. The bigger the potential marketplace for counterfeit shirts or the infamous half-and-half scarves, the greater the sums possibly being lost.

I should point out that this issue is not necessarily new. In 2003, the Court of Appeal agreed with Arsenal that Matthew Reed, who ran a stall selling unauthorised replica souvenirs near the club's then home ground of Highbury, had infringed their registered trademarks (https://www.bailii.org/ew/cases/EWCA/Civ/2003/696.html).

Nevertheless, the problem has become more pressing with the growing consumption of news about and products featuring the leading lights of the Premier League, Ligue Un, La Liga and Serie A.

I maintain much more than a passing interest in the subject, having secured a landmark ruling in favour of a client in a case involving the Rugby Football Union (RFU) and Nike in one landmark case (http://news.bbc.co.uk/1/hi/england/1895184.stm), and acted on behalf of some of football's biggest clubs in the years since.

That clubs are so active in this regard might surprise many readers, given that trademark cases aren't covered as frequently as matches or transfer dealings - partly due to fact that they rarely go to trial.

The last notable related judgement was by the Intellectual Property Office (IPO) in favour of Leicester City in November 2018 (https://www.ipo.gov.uk/t-challenge-decision-results/o75518.pdf).

Clubs naturally, though, want to stem the loss of fan-paid cash which they feel should go to them.

There is, though, another point. Intellectual property should be rightly protected because, if not, brand values can be undermined by articles which clubs have no control over.

Supporters do not necessarily question who has made the goods which they buy. They might assume that a poor quality kit bearing what seems to be a legitimate logo has been made for a particular club.

In this increasingly consumer-conscious age, clubs are keen to ensure the integrity of products and, therefore, their reputations.

Take Liverpool's willingness in recent weeks to boast of its ability to match its status as English football's most successful team in terms of trophies won with its sustainability credentials (https://www.liverpoolfc.com/news/lfc-wins-sustainability-award-football-business-awards).

As much as fans who just want to attend matches may resent the emphasis on commercial earnings, that income can contribute to the performance of the teams they behind.

Clubs also appreciate the other side of the equation: a strong commercial showing can help make them competitive on the pitch and, in turn, attract more supporters willing to spend more money into the future.