Mumbai: Rajasthan Royals, Kings XI Punjab and the Board of Control for Cricket in India (BCCI) will seek independent arbitration over the termination of the two Indian Premier League (IPL) franchises by the game’s administrator, reflecting a softening of the latter’s stand.
The cricket board had expelled Rajasthan Royals, owned by Jaipur IPL Cricket Pvt. Ltd, and Kings XI Punjab for alleged violations of the franchisee contract on 10 October. The intent to seek arbitration was announced by lawyers in the Bombay high court on Monday when a case filed by Rajasthan Royals against the termination came up for hearing. A similar case has been filed by Kings XI.
Janak Dwarkadas, lawyer for Rajasthan Royals, and Darius Khambata, counsel for Kings XI, told the court that the two teams along with BCCI are seeking arbitration. They want to appeal under section 17 (arbitration) and are in talks with former Supreme Court (SC) judge B.N. Srikrishna to conduct the mediation proceedings. Srikrishna is also chairman of the judicial committee formed on the Telangana issue. The judge presiding over the Bombay high court proceedings—justice S.J. Vazifdar —has decided to give an order in the case he’s hearing on 18 November but the arbitration appeal is likely to go through as all parties involved appear to be united on the move.
BCCI chief administrative officer Prof. Ratnakar Shetty said he had no comments to offer. BCCI public relations officials declined to comment on why the board had agreed to arbitration.
An official belonging to one of the parties involved in the lawsuit said the appeal for arbitration had been made in consultation with BCCI.
Rajasthan Royals moved the Bombay high court on 25 October against the termination after repeated appeals to the cricket board for dialogue went unanswered.
Kings XI Punjab filed an arbitration petition challenging BCCI’s decision to terminate the franchise on 11 November.
Kings XI, jointly owned by Preity Zinta, Ness Wadia, Mohit Burman and Karan Paul, had won the Mohali bid in early 2008 for Rs 76 crore.
Rajasthan Royals may be seeking arbitration instead of battling it out in court because it doesn’t want to “rake up the matter publicly”, although it appeared to have a case, said Hiren Pandit, managing partner, ESP (an entertainment and sports marketing unit under GroupM), GroupM India Pvt Ltd. Rajasthan Royals may press for a stay on the next edition of the tournament if their expulsion is upheld, he said.
“Sponsorship deals would be under pressure, especially those who’ve put money on Rajasthan Royals and Kings XI, but these deals can always be renegotiated,” he said. “Also, all sponsorship deals are struck in any case for a period of three years, so many of them may be up for renegotiation already.” According to GroupM estimates, ground sponsorships for sports add up to Rs 480 crore, the endorsement market is in the region of Rs 254 crore and team sponsorships are about Rs 319 crore. Cricket, the most widely followed sport in India, has an 85% share of the ground sponsorships, 97% of the endorsement and 99% of the team sponsorships markets. Other experts say that it’s in the interest of BCCI and the franchisees that the IPL isn’t disrupted, which is why arbitration has been sought.
“It would be a pity, for instance, if the court were to say, let’s put the IPL on hold while the matter’s being decided. Also, under arbitration, you’re saved from airing your dirty laundry in public,” said an expert associated with sports marketing who did not want to be identified. The IPL is a Rs 1,000 crore plus property (inclusive of ground and television advertising spending).
Sponsors associated with the deposed teams may have to look for new opportunities elsewhere or stay outside the stadium, said Mahesh Ranka, general manager, Relay Worldwide, Starcom MediaVest Group. “However, the exclusion of one or two teams is not going to impact the popularity of the series itself, because none of these franchises have built that kind of wild fan following, that would seriously throw IPL out of gear,” he said.