Match-fixing and doping scandals – the potential fallout

Author: Mark Buckley

Europol, Europe’s intelligence-sharing agency, has announced it is currently investigating match fixing in football “on a scale that has not been seen before”. The investigation which started in Germany, Finland and Hungary has since been extended to include Slovenia and Austria. It has been running for 18 months and, in that time, Europol has identified 425 individuals who may be involved and has looked at 680 suspect matches in 30 countries.

Doping and match-fixing stories are being reported on an almost daily basis across the world. Less than a week after Europol’s announcement, the Australian Crime Commission (ACC) announced that its year-long investigation has revealed that the use of performance enhancing drugs is rampant in Australian sports, often facilitated by organised crime and even "orchestrated and condoned" by coaches across multiple sporting codes.

Europol and the ACC will bring criminal proceedings against anyone they believe may be involved in match-fixing or doping offences. Those found guilty can expect hefty fines or even custodial sentences. FIFA is urging courts to hand down lengthy custodial sentences for anyone found guilty of match fixing.

What we have also started to see in match-fixing and doping cases is that those involved are now facing civil claims, brought by unhappy sponsors, event organisers or even third parties who have mistakenly paid out to cheats.

The highest profile case is Lance Armstrong. He is currently facing claims from SCA Promotions, a Dallas-based company which indemnifies sponsors against the risk associated with paying out to sportsmen who appear to be doing the impossible; the Australian government which has announced that it will seek repayment of several millions in appearance fees in competitions held in its country; the US Anti-Doping Agency which will seek to recoup its massive legal fees incurred during its lengthy investigation into his doping; and even his own charity LiveStrong, which may sue him for the damage done to their brand. The Times newspaper is also suing him to recover over £1 million incurred following an out-of-court settlement with him, based on fraudulent misrepresentations made by him that he had not been involved in doping.

A paying party would be entitled to have any contract entered into with a dishonest sportsman or team rescinded. The court could order that the contract is set aside, and that any money paid out under it (sponsorship, win-bonuses, prize money etc.) must be repaid. The court may also order that any consequential losses, for example damage to reputation caused by being associated with a match fixer or doper, or any loss in a sponsor’s market value, would also need to be met by the guilty party.

The complexity of contractual relationships between event organisers, players, officials and sponsors means that the possible scale of the litigation is huge. In the same way that contracts can be set aside for fraudulent misrepresentation, insurance policies can be avoided as well. It is also possible that settlement agreements entered into in good faith can be set aside.

Anyone involved in the world of sport should watch investigations like Europol’s and the ACC’s closely. It is likely that any findings of criminal liability could open the floodgates for civil claims down the road.

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