Monday, July 28, 2008

ATP vs Hamburg - Trial May Go Beyond Two Weeks

by Savannah

ATP Trial Could Last Beyond Scheduled Two Weeks
By Daniel Kaplan, Staff Writer, SportsBusiness Journal

Organizers of the Hamburg, Germany, tennis tournament and the ATP failed to settle their differences over the weekend as of 8:00pm ET yesterday, a source close to the talks said, and the case was headed to a second week of trial this morning. The Hamburg stop is suing the ATP under U.S. antitrust law for planning to demote the event. With a week under its belt, the trial threatens to go longer than its scheduled two weeks now, if it gets to the jury, because of delays last Thursday regarding a witness issue and break for settlement talks. Friday’s court session revealed that ATP board director Iggy Jovanovic had a contract while on the board to broker a sponsorship for Emirates Airline with Tennis Canada, owner of one of the elite ATP events. This appears to violate the ATP bylaws that player representatives on the board not work for a tournament member. He also worked for Abu Dhabi in trying to secure an ATP event. He was accused by the Hamburg tourney of using insider information to pass on to Abu Dhabi, especially as it related to Doha, Qatar, being available. The Qatari Tennis Federation owns 25% of the Hamburg event, and owns a tournament in Doha that applied for the second tier of the new ATP calendar but was turned down. Questioned if he had read the bylaws when he took his post in January '06, Jovanovic testified he could not recall. Jovanovic said he was an adviser to Abu Dhabi on a variety of matters, not just tennis, and that he was not hired by Tennis Canada to find sponsorships but was only assisting a friend to help Emirates. Nonetheless, he signed a contract with Tennis Canada, according to a trial exhibit, that entitles to him 10% of Emirates sponsorship fee, which is nearly $500,000.

PATTERN EMERGING: What is emerging at the trial is that the ATP’s new calendar system involves multi-tiered payments from the tournaments to be part of the circuit. More than $80M over five years in bid premiums are expected by the ATP, Hamburg lawyer Rob MacGill said. Big premiums were offered by events on top of the value of the sanction they were bidding on. So Beijing for example paid a bid premium of $1.1M over 10 years for its tier 2, or 500 as it is known in the ATP '09 calendar. Today, Jovanovic is expected to finish his testimony, and then expected to testify are Charlie Steeb, the current tournament director in Hamburg, board member Charlie Passarell, and ATP Tour Chair & President Etienne de Villiers.



tristann said...

Interesting stuff, Savannah. Thank you for keeping us abreast of what is happening with the Hamburg trial. Even though I am not sure about what is going on, since I am not familiar with many of the people behind the scenes, as a fan, what I am taking away from this is that there seems to be many conflicts of interest within the ATP, with no one clearly representing the interests of the players.

It will be interesting to see how this plays out.

Savannah said...
This comment has been removed by the author.
Savannah said...

I deleted my comment because I do know something about grammar.

In my very humble opinion the one thing to do with a seemingly very complex situation such as this is to follow the money.

All those $30+ millions of dollars being passed around made my head spin.

An ATP board member is on the payroll of a country with a major tennis event.

It seems that the same board member voted the way that country would want him to vote.

The head of the ATP seems to have an axe to grind against the plaintiff country. Germany.

The sports economist, while seeming to be a bit shady, has not had his testimony refuted, only his character impinged. It's like a defense attorney bringing in a crack head to verify a story. The crack head may be, well, a crack head, but his testimony can be accurate.

It's interesting indeed Tristann.