The Racing Partnership and Others v Sports Information Services Limited

This appeal concerned the scope of the equitable doctrine of misuse of confidential information (breach of confidence) and the elements of the tort of conspiracy to injure by unlawful means in the context of real‑time horseracing data. The court considered (i) whether the Arena Racecourses’ published terms and conditions and the racecourse owners’ control rendered short‑lived race‑day data (the pleaded “Key Raceday Triggers”) confidential; (ii) whether the Tote and SIS received or used that information in circumstances importing an equitable obligation of confidence; and (iii) whether liability for unlawful‑means conspiracy requires knowledge that the means used are unlawful.

On the question of breach of confidence the panel was divided. The majority concluded that SIS was entitled to rely on contractual assurances and warranties from the Tote and that a reasonable recipient in SIS’s position was not put on obvious notice that the data supplied by the Tote were being supplied in breach of an equitable obligation. Consequently, the judge’s wider finding that all Raceday Data were confidential was reversed by the majority.

On the tort of unlawful‑means conspiracy the majority held that knowledge that the means are unlawful is not a prerequisite of liability; the unlawful means may consist of crimes, torts or breaches of third‑party contractual terms provided that the unlawful means are the instrumentality by which the claimant’s loss is caused. The court therefore allowed parts of TRP’s cross‑appeal concerning conspiracy insofar as the unlawful means relied upon were the use of exchange pricing in breach of the exchanges’ terms and (subject to the factual findings necessary in respect of instrumentality and knowledge) misuse of short‑lived race‑day information.

Background and parties:

• The Racing Partnership Limited (TRP) had obtained exclusive media rights (from 1 January 2017) to collect and transmit live betting prices and race‑day factual information from a number of racecourses owned by Arena Leisure/ Arena Racing Corporation (the Arena Racecourses). Sports Information Services Ltd (SIS) had previously held those rights under an earlier agreement with Arena. TRP alleged that SIS continued, after 1 January 2017, to supply consolidated pre‑race prices (“Betting Shows”) and race‑day data (“Raceday Data”) to bookmakers in ways that infringed TRP’s rights.
• TRP’s pleaded causes of action included copyright/database infringement (largely not in issue on these appeals), misuse of confidential information (equitable breach of confidence), breach of contract and a conspiracy to injure by unlawful means (alleging a combination between SIS, bookmakers and the Tote to obtain and use the data).

Procedural posture:

• The first‑instance judge (Zacaroli J) after a three‑week trial dismissed all TRP’s claims except for misuse of confidential information. SIS appealed that finding of misuse of confidential information. TRP cross‑appealed the dismissal of its unlawful‑means conspiracy claim. Permission to appeal was given on specified grounds.

Issues framed by the Court of Appeal:

1. Whether the Arena Terms (published conditions of entry and special media conditions) bound the Tote and/or SIS such that Raceday Data had the necessary quality of confidence;
2. Whether the Raceday Data (the pleaded Key Raceday Triggers: non‑runners/withdrawals, the off and the result including steward inquiries) had the necessary quality of confidence in the short time frame before and after each race;
3. Whether the Tote’s supply to SIS and SIS’s receipt/use of that data were in circumstances importing an equitable obligation of confidence;
4. Whether, for an unlawful‑means conspiracy based on infringement of private rights, the defendant must know that the means are unlawful; also which party bears the burden of proof on such knowledge;
5. Whether SIS’s admitted breaches of the betting exchanges’ terms (by taking prices from exchanges to create Betting Shows) constituted relevant unlawful means that were instrumental in causing TRP’s loss.

Reasoning and principal conclusions:

• Applicability of Arena Terms: A majority of the court held that SIS was entitled to rely on contractual assurances and warranties from the Tote and that (in the majority view) a reasonable recipient in SIS’s position was not on obvious notice that the Tote’s supply was in breach of an equitable duty. The majority therefore concluded the judge had erred in holding that the Arena Terms bound the Tote (for the purposes alleged) so as to make SIS automatically on notice; that reasoning led the majority to allow SIS’s appeal on the breach‑of‑confidence finding. One judge disagreed and would have upheld the judge’s conclusion that the Key Raceday Triggers were confidential and that SIS was on notice.
• Quality of confidence and scope: The court emphasised the Coco v A.N. Clark tripartite test (information with necessary quality of confidence; imparted in circumstances importing obligation; unauthorised use to detriment). The panel stressed that confidentiality is context‑sensitive and turns on inaccessibility during the relevant short time window. The majority nevertheless judged that the judge’s broad finding (that all Raceday Data were confidential) went beyond the pleaded Key Raceday Triggers and that reliance on the Tote’s contractual assurances was material.
• Equitable notice and contractual assurances: The majority took particular account of the Tote’s contractual warranties in the HoT and the fact that SIS had made inquiries and received assurances; a reasonable recipient could rely on such assurances rather than being put on notice that the supply infringed a confidential interest.
• Unlawful‑means conspiracy: The majority concluded that knowledge that the means were unlawful is not a universal precondition of liability in unlawful‑means conspiracy; instead the key inquiry is whether there was just cause or excuse for the combination and whether the unlawful means were the instrumentality by which harm was inflicted. The court accepted that the unlawful means may include breaches of third‑party terms (such as the exchanges) if those breaches were instrumental in causing the claimant’s loss. The judges differed on the application of that principle to the particular facts: two judges would allow TRP’s conspiracy claim in part (as to the exchanges’ breaches and misuse of information as instrumental), one judge would dismiss it.

Remedy and scope:

• The majority therefore allowed SIS’s appeal on the misuse‑of‑confidential‑information finding but allowed TRP’s cross‑appeal in part on the unlawful‑means conspiracy point, subject to the factual questions of instrumentality and causation being satisfied in respect of the specific unlawful means relied upon.

The Court of Appeal split on the issues. By majority the court allowed SIS’s appeal on the judge’s finding of misuse of confidential information, holding that SIS was entitled to rely on contractual assurances and warranties from the Tote and that a reasonable recipient in SIS’s position was not put on obvious notice that the Tote was supplying data in breach of an equitable obligation. By majority the court also allowed TRP’s cross‑appeal in part on unlawful‑means conspiracy: the majority held that knowledge that the means are unlawful is not a necessary ingredient of the tort and that unlawful means may include breaches of third‑party contractual terms and other torts where those means are the instrumentality of the claimant’s loss. The appeals were therefore allowed in part, with differing reasoning on particular legal points across the three judges.

Appeal from Zacaroli J, High Court of Justice, Business and Property Courts, Intellectual Property List (Chancery Division) — [2019] EWHC 1156 (Ch); heard before the Court of Appeal (Civil Division) and delivered 9 October 2020 (neutral citation [2020] EWCA Civ 1300).