SBD/July 8, 2011/Marketing and Sponsorship

NHL, Molson Coors Appeal Ruling Invalidating $375M Sponsorship Deal

Labatt said the NHL reneged on its deal in favor of one with Molson Coors

Lawyers for the NHL and Molson Coors Thursday appeared at a hearing before the Court of Appeal for Ontario to appeal a “ruling which tossed out their $375-million North American sponsorship deal,” according to Josh Rubin of the TORONTO STAR. Molson Coors, Labatt and league attorneys during the hearing “revealed that Labatt’s deal with the NHL was for a relatively-paltry $36 million, spread over three years.” A Labatt source later said that the contract’s “total value was actually closer to $75 million, a figure which still puts it well below the Molson-Coors deal.” Molson Coors attorneys would not specify in court “how much the company’s deal with the NHL was worth, but it was widely reported at the time it was announced in February that it was worth $375 million.” The three-judge Court of Appeal panel “reserved judgment after hearing arguments from all three sides” on Thursday, but Associate Chief Justice Dennis O’Connor said that the panel would “try to come up with a written decision as soon as possible.” Justice James MacPherson questioned NHL attorney Terrence O’Sullivan’s suggestion that Labatt’s "negotiating window with the league had ended Oct. 22.” Ontario Superior Court Judge Frank Neubold had “originally ruled that the league reached a binding deal with Labatt on Nov. 12.” Molson Coors attorney Paul Steep argued that “even if Labatt had a binding deal with the NHL, Molson’s agreement should still go ahead, and Labatt should have just sued for damages” (TORONTO STAR, 7/8). Read the full decision.

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