The Court of Appeal has handed Monckton Chambers a major victory after ruling that broadcaster BSkyB should reduce its stake in ITV.
Lord Justices Rix and Lloyd and Mr Justice Mackay rejected the appeal made against a ruling handed down by the Competition Commission in December 2007 that stated that BSkyB should reduce its stake from 17.9 per cent to below 7.5 per cent in ITV.
It is the fourth ruling made on the matter and leave to appeal has been rejected by the presiding judge, meaning that the broadcaster can only appeal if it goes directly to the Supreme Court.
Monckton Chambers’ John Swift QC was instructed by the Treasury Solicitors to act for the Competition Commission.
Paul Lasok QC, also of Monckton Chambers, was instructed by the Treasury Solicitors on behalf of The Secretary of State for Business Enterprise and Regulatory Reform.
BSkyB, which was represented in court by Blackstone Chambers’ Michael Beloff QC, bought its 17.9 per cent stake in ITV in November 2006. The appeal judges ruled that by taking this position BSkyB was given the “opportunity to exercise material influence over ITV’s policy”.
The judges added: “It seems to us that the Tribunal was correct in its view that it was open to the Commission.. to consider the possibility of a merger or alliance proposed by the board of ITV as part of its strategy.”
This influence, the judges ruled, did not extend to ITV’s media plurality, which Virgin argued would be affected by the takeover. The judges added that while this is not of importance to the current case it may arise at a later date.
BSkyB paid 135p a share for its stake in ITV. The total cost was £940m. ITV’s shares closed at 57.85p on Wednesday. This represents a loss of around £530m for BSkyB.
Counsel:
Competition Commission: Monckton Chambers’ John Swift QC, Daniel Beard and Rob Williams instructed by the Treasury Solicitors
The Secretary of State for Business Enterprise and Regulatory Reform: Monckton Chambers’ Paul Lasok QC and Elisa Holmes instructed by the Treasury Solicitors
British Sky Broadcasting Group: Blackstone Chambers’ Michael Beloff QC, Brick Court’s James Flynn QC and Aidan Robertson QC instructed by Allen & Overy partner Antonio Bavasso
Virgin Media Inc: Brick Court’s Richard Gordon QC and Marie Demetriou were instructed by Ashurst partner Nigel Parr
