Otium Entertainment Group Limited trading as Coventry City Football Club and the 2nd Judicial Review

 

A number of Coventry City fans have asked the Trust whether it is true, as the Football Club maintain, that they are not involved in the current Court action against Coventry City Council and Wasps.  This note explains the true position.

The current court action seeks a reworking and increased price for the deal completed by Coventry City Council to sell its shares in ACL to Wasps Holdings Limited, and a claim for compensation of £30m, on the grounds of being excluded from the opportunity to bid against Wasps themselves.

Otium Entertainment Group (OEG) are named as complainants on all documents submitted to the Courts in claiming the 2ndJudicial Review. The other complainants are Sky Blue Sports & Leisure Ltd (SBS&L) and ARVO Master Fund Limited, who are the only shareholders in OEG. SISU are not mentioned as complainants or even interested parties

Fans are assured that the “Club” is not part of the court action and not affected by it or its costs.That assurance of course depends on there being separation between CCFC and its owners (including Otium) who are taking the court action. Is Otium Entertainment Group Ltd separate from CCFC? In short NO what follows explains why.

·         all complainants including OEG are joint and severally liable for the costs of any legal action. Other joint complainants can give assurances that this will not happen but that is not a binding legal position. SBS&L has no income and ARVO are based in the Cayman Islands

·         Coventry City Football Club is the trading name of Otium Entertainment Group Ltd.  OEG is a legal entity, CCFC is not

·         OEG are registered at Companies House as a legal entity CCFC is not

·         OEG owns the English Football League (EFL)share, CCFC does not. OEG therefore has the legal right to trade in the EFL as CCFC. https://beta.companieshouse.gov.uk/company/00080612/filing-history

·         The trademark CCFC is owned and operated by OEG https://trademarks.ipo.gov.uk/ipo-tmowner/page/search?id=329644&domain=1

·         All financial information, Balance Sheets etc for the “Club” are filed as OEG not CCFC. Even the 2016 directors report of OEG seems to refer to the club as OEG, and no mention of CCFC at all. See https://beta.companieshouse.gov.uk/& company number 07612487. CCFC files no accounts either at Companies House or at the EFL

·         All assets are owned by OEG (including players). “CCFC “or “the Club” has no assets or for that matter liabilities, it is simply a name

·         There is only one legal entity that can have a bank account – OEG. CCFC is just a trading title with no other legal status so cannot.

·         Otium Entertainment Group will be the entity recognised by HMRC for the purposes of VAT, PAYE & Corporation tax. CCFC is not

·         All turnover, grants, player sales etc are receivable by OEG not “CCFC”.   Similarly, all costs are the liability of OEG and when paid conducted through the OEG bank account

·         All employees, be it players, managers, coaching staff, office and commercial staff or directors are employed and paid by OEG. CCFC has no employees

·         Any contracts (eg player contracts or lease agreements etc) are signed by directors of OEG. There are no directors of CCFC. Contracts are with OEG not CCFC

·         The training ground is owned and operated by OEG not CCFC

·         The agreement to play at the Ricoh is between ACL and OEG

·         All assets of the “club” are charged against its borrowings (see Companies House for details). That agreement is between Otium Entertainment Group Limited and ARVO Master Fund Limited. “the Club” or CCFC are not even mentioned in the charge document

·         A professional football club is the operation of football & football financial activities including the sales of matchday tickets, sales of players and the payment of football related & other expenses. All completed in this case by OEG

·         CCFC is OEG by another name. CCFC doesn’t operate at all unless it is through Otium

 

Against all the evidence we have club statements and assertions that “the Club” are not involved, liable or affected, including the following dated 15 September 2017 from the Club

Coventry City Football Club can confirm to supporters that it has been made aware that the owners of the club have been granted the right to appeal against the judgement of the High Court made on Friday 14th July.

“As stated previously, the club and its staff continue to fully focus on the day-to-day running of the football club. The club can also confirm again that we are not liable for any costs in relation to this appeal. Regardless of this appeal by the owners, the club and its staff remain committed to working with ACL/Wasps and its staff to ensure the smooth running of the Sky Blues’ matchdays and developing this relationship further, as stated earlier this week.”

Clearly from the evidence at Companies House, the EFL, the Courts, etc. Otium Entertainment Group Ltd, is in operation and practice, CCFC. The reality is that it is not possible to separate the two. The only “separation” is thatthe fans support CCFC, not OEG.  The “Club” the “Sky Blues” or CCFC lives in the hearts and minds of its supporters alone, as always has and will be the case.In all other material ways, CCFC does not exist except as Otium Entertainment Group, trading as CCFC.

There is no separation and the assurances to the fans that CCFC are not part of the court actions are misleading at best. Otium Entertainment Group Limited trading as CCFC, is fully part of the court action. Of course, that has serious implications for the future of our “Club” and the understanding of the problems it faces. The Court action brings potential risks for Otium Entertainment Group and therefore the “Club”

 

 

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