SKY Italia Wins Again Against MediaPro
June 20, 2018
Cleary Gottlieb represented SKY Italia S.r.l. in the confirmation of the earlier suspension of MediaPro Italia S.r.l.’s sale of Serie A soccer audiovisual rights.
By order issued on June 11, 2018, the Milan Tribunal rejected the appeal (reclamo) filed by MediaPro against the decision rendered by the same Tribunal, which had granted the petition filed by SKY and suspended the tender procedure dated April 6, 2018, for the assignment of Serie A rights.
The business chamber of the Milan Tribunal confirmed the multiple counts of illegal conduct against MediaPro which violated the so-called Melandri Decree, EU competition law (art. 102 TFUE) and unfair competition law.
Among other things, according to the Milan Tribunal, MediaPro violated its “obligations as an independent intermediary” to (1) refrain from carrying out activities involving publishing responsibilities; (2) guarantee to sub-licensees the widest entrepreneurial and publishing freedom in the packaging of audiovisual products, allowing them to choose whether and to what extent to avail themselves of the services that MediaPro could offer; and (3) license audiovisual rights in a fair, transparent and non-discriminatory manner.
In particular, MediaPro did not offer sub-licences on Serie A rights. MediaPro only offered, as main packages, audiovisual products edited by MediaPro itself and lasting 270 minutes per match.
Based on the tender rules, in order to be able to offer Serie A matches to their subscribers, pay-tv operators had to purchase at least a main package with an audiovisual product. The contractual conditions attached to the main package obliged them to (1) broadcast MediaPro’s audiovisual products in their entirety for each Serie A match broadcast live; (2) allow MediaPro to sell all advertising spaces in the corresponding air-time.
Pay-tv operators could partially escape these obligations only by purchasing optional package. So they had to incur “additional costs […] to regain possession of the right to: (i) exercise their publishing activities (ii) commercialize advertising space autonomously, and (iii) freely manage the timing, methods of insertion and duration of their advertising space.”
According to the Tribunal, MediaPro’s conduct was an abuse of its dominant position, because MediaPro was leveraging its monopoly on the Serie A rights to enter the television markets downstream, instead of remaining an intermediary. The Tribunal acknowledged that such acts would constitute acts of unfair competition as well.
Furthermore, the Tribunal confirmed the existence of the imminent and irreparable harm connected to the conduct of a tender “designed to regulate a market structure for the next three years (three football seasons)” and capable of “unlawfully causing changes in market conditions”, as well as “serious damages to individual operators.”