The Racing Partnership Ltd & Ors v Sports Information Services Ltd

An equitable obligation of confidence depends on objective notice. A recipient who receives information under express assurances and a warranty from an apparently reputable supplier is not ordinarily on notice of a breach of confidence without clear countervailing indications.

For unlawful means conspiracy, the conspirators need not know that the means are unlawful, provided they know the facts making them unlawful. The unlawful means must be the means by which loss is caused, rather than merely an occasion for loss. Unauthorised acquisition of commercially valuable information to supply the same customers can satisfy that requirement.

TRP held exclusive rights to collect and distribute live horseracing data from Arena racecourses for fixed-odds betting. SIS obtained Raceday Data from the Tote and pricing information from betting exchanges after its own agreement with Arena had expired.

Zacaroli J dismissed TRP’s claims except for misuse of confidential information: [2019] EWHC 1156 (Ch); [2020] Ch 289. SIS appealed the confidence finding. TRP cross-appealed the dismissal of its unlawful means conspiracy claim.

The central questions concerned the Tote’s position under Arena’s entry terms, whether SIS received confidential information with notice of confidence, and the elements of unlawful means conspiracy.

1. SIS’s appeal was allowed. By a majority, Phillips and Lewison LJJ held that SIS was not subject to an equitable obligation of confidence in respect of the Key Raceday Triggers. Applying the objective test derived from Coco v A.N. Clark (Engineers) Ltd, the proper starting point was the Tote’s express contractual warranty that it had the necessary third-party rights to supply the data. SIS had made enquiries and received assurances from its apparently reputable counterparty. There were no sufficiently clear countervailing indications requiring a reasonable recipient to reject those assurances. Arnold LJ dissented on this issue.

2. The pleaded confidence claim was confined to the Key Raceday Triggers, not all Raceday Data. The trial judge therefore could not make an order extending to all Raceday Data.

3. All members of the court agreed that the Tote was not contractually bound by the Arena Terms. The Tote Agreement impliedly permitted entry for its pool-betting activities, but not a wider use for fixed-odds betting. Its excess use made it a trespasser only to that extent. The Arena Terms could not be accepted as a contractual basis for an activity which they prohibited.

4. TRP’s cross-appeal was allowed in part. By a different majority, Arnold and Phillips LJJ held that knowledge that the means are unlawful is not an element of unlawful means conspiracy. It is enough that the conspirators know the facts which make the conduct unlawful. The contrary first-instance ruling was inconsistent with the binding effect of Belmont Finance Corp v Williams Furniture Ltd (No 2) and the persuasive reasoning in Churchill v Walton.

5. The majority also held that SIS’s admitted breaches of the exchanges’ terms were instrumental in causing TRP loss. SIS obtained information by those breaches in order to compete in supplying the same information to the same customers. The breaches were therefore the means of causing loss, not merely the occasion for it. The conspiracy claim succeeded to that extent, and insofar as it relied on the Tote’s misuse of confidential information. It failed insofar as it relied on alleged breaches of the Arena Terms.

• Court of Appeal (Civil Division): SIS’s appeal against the finding of misuse of confidential information was allowed. TRP’s cross-appeal on unlawful means conspiracy was allowed in part: [2020] EWCA Civ 1300.
• High Court (Chancery Division): Zacaroli J dismissed TRP’s claims except the claim for misuse of confidential information: [2019] EWHC 1156 (Ch); [2020] Ch 289.