Matt Green comments on the multi-billion pound class action over the delisting of the BSV cryptocurrency, in CDR Magazine

Posted on: July 31st, 2024 by Yvonne Uzoka

Director and Head of Blockchain and Digital Assets, Matt Green, comments on the news that the UK Competition Appeal Tribunal has agreed to certify a claim for investors to sue four crypto exchanges over their decision to delist the Bitcoin Satoshi Vision (BSV) cryptocurrency.

Matt commented: “This case lends itself to a wider narrative with two main camps: those who believe in BSV as Satoshi’s true vision for Bitcoin and those who do not.

“The claimant class may seek to justify both price and broader adoption issues on market manipulation and competition interference, in the form of delisting, by those who want to suffocate BSV. Whether there is a right to claim concerted market manipulation or whether this is simply private companies delisting a token to match market demand is likely to be a vital matter in this dispute.”

Matt’s comments were published in CDR Magazine, 31 July 2024.

Matt Green comments on the FCA fining a Coinbase subsidiary, in Thomson Reuters Regulatory Intelligence

Posted on: July 29th, 2024 by Yvonne Uzoka

Director and Head of Blockchain and Digital Assets and Technology Disputes, Matt Green, comments on the FCA fining Coinbase’s UK e-money business £3.5 million for onboarding high-risk customers.

Matt noted that the fine is a reminder that even the most established and trusted brands in the cryptoasset industry sometimes onboard high-risk customers.

Matt commented: “Funds are often off-ramped at crypto currency exchanges following a fraud, scam and or hack, turning the process of crime from crypto assets to fiat money, to be further laundered. The process itself means even the most trusted cryptocurrency brands can fall short during the onboarding process and allows high risk individuals to use these services to conceal and move money. In some respects, the more legitimate the exchange, the smoother the laundering process can be, subject to know your client checks.”

Matt’s comments were published in Thomson Reuters Regulatory Intelligence, 26 July 2024.

Central Family Court hands down landmark ruling in matrimonial property case

Posted on: July 25th, 2024 by Yvonne Uzoka

In June 2024, HHJ Edward Hess sitting in the Central Family Court handed down his judgment in the case of RM V WP [2024] EWFC 191 (B) ­­– a complex financial remedies case concerning the division of matrimonial property, and to what extent real property had been ‘matrimonialised’.

Jim Richards and Eleanor Wood of Lawrence Stephens acted on behalf of the husband, instructing Jenna Lucas of Pump Court Chambers.

The case centred around four properties owned by the respondent husband, with the wife arguing that she should receive 50% of the equity of all four properties. She argued this on the basis that these properties – owned by the husband prior to the marriage and held in his sole name – had become ‘matrimonialised’ by virtue of serving as family homes throughout their marriage. HHJ Hess found that one of these properties had never served as a family home, and as such had not been ‘matrimonialised’. The wife contended that she should receive 50% of the equity of the three remaining properties if HHJ Hess view was that this asset was not matrimonalised.

In considering what the wife’s award should be, HHJ Hess concluded in paragraph 37 of his judgment that “there is justification here for departing in the husband’s direction from an equal division of the net equity in the three homes which have been family homes. My view is that the fair answer here is for the wife to be awarded the amount that meets her needs.”

HHJ Hess ultimately assessed the wife’s needs to be less than 50% of the equity in the three ‘matrimonialised’ properties and granted her award on this basis accordingly.

Eleanor Wood, Co-Head of Family at Lawrence Stephens and solicitor for the husband, commented: “We are pleased to have secured a successful outcome for our client in a complex case which presented several issues which needed to be considered and dealt with at various stages.

“This highlights the importance of a well-prepared case to identify how the assets were used and where they originated when determining how they should be divided upon separation. The outcome is a fair one. It reflects the needs of the wife in conjunction with how the assets were used or matrimonialised, and that it is not always a simple sharing principle being applied.”

The full judgment can be read here.

Code of Practice on fire and re-hire now in force.

Posted on: July 22nd, 2024 by Hugh Dineen-Lees

This article was updated on 2 August 2024 to take account of the changes to the statutory Code of Practice on fire and re-hire as re-issued by the Government on 30 July 2024. 

On 18 July 2024, the Secretary of State issued the Statutory Code of Practice on Dismissal and Re-engagement under Section 203 of the Trade Union and Labour Relations (Consolidation) Act 1992. This is more commonly referred to as the Code of Practice on ‘fire and re-hire’.

The code provides practical guidance on how to promote the improvement of industrial relations. The Secretary of State considered that the practice of dismissing and re-hiring employees as a means to change their terms and conditions of employment could give rise to conflict between employers, employees and Trade Unions, which could subsequently lead to a deterioration in employment and industrial relations.

The code will provide guidance to employers, employees and their representatives where an employer is considering making changes to one or more of its employees’ contracts of employment and envisages that if the employee does not agree to some or all of the changes, the employer may opt for dismissal and re-engagement in respect of that employee. Some of the key provisions include;

  • Employers need to explore alternatives to ‘fire and rehire’ and it should only be used as a last resort.
  • Employers should not threaten dismissal if it is not actually envisaged and must not coerce employees into signing new terms and conditions.
  • The employer should ensure that the only terms which are changed are those which have been subject to the information-sharing and consultation process and should not use this as an opportunity to make any further changes.
  • A requirement to consult ‘for as long as reasonably possible’, but — unlike collective redundancy consultation — there is no minimum time period. Employers are told to contact Acas at an early stage before they raise ‘fire and rehire’ with the workforce.
  • Once the employer becomes aware the proposed changes are not agreed, they should re-examine them. The employer should consider feedback from employees and/or their representatives.
  • The employer might commit to reviewing the changes at a future set time and reconsider whether they are still needed. If more than one change is being implemented, the employer might also consider introducing them on a phased basis.

Whilst there is no stand alone claim for a breach of the code and its provisions, the Tribunals must take this into account in all relevant cases, including claims for unfair dismissal. The Tribunals will have the ability to uplift compensation by up to 25% if an employer unreasonably fails to follow it or reduce any award by up to 25% if the employee has unreasonably failed to comply. However, the uplift will not apply to protective awards for failure to inform and consult in consultation redundancy situations.

It is also worth noting that the Labour party have pledged to legislate to end ‘fire and re-hire’ and to replace and strengthen the code. Therefore, if you are facing any issues in relation to the above, speak to our specialist employment team where we can provide up-to-date information and advise you on how to manage any potential conflicts which may arise.

Lawrence Stephens completes complex loan for Blue Shield Capital

Posted on: July 17th, 2024 by Hugh Dineen-Lees

We are pleased to report that Lawrence Stephens has successfully completed a £5.2m facility with Blue Shield Capital, facilitating the acquisition and buy out of the share capital of two companies that own a 10-storey commercial office property in Norwich.

The team was led by Director and Head of Banking Ajoy Bose-Mallick, with support from Senior Associate Ashley Wright and Trainee Solicitor Alex Ruder on the banking side, Senior Associate Rachel Coulthard  on the real estate finance side; and from Solicitor Lucy Cadley for corporate/commercial matters.

Ajoy commented: “This complex transaction is a testament to the hard work and collaboration of our Banking, Real Estate, and corporate teams. We are delighted to see our client’s loan portfolio expand.”

Sports and Entertainment team appointed to Sport Resolutions Pro Bono Service

Posted on: July 11th, 2024 by Natasha Cox

We’re thrilled to announce that our Sports and Entertainment team at Lawrence Stephens have been appointed to the Sport Resolutions Pro Bono Service.

The Pro Bono Service provides independent, efficient and accessible dispute resolution services to those in the sports industry of limited financial means.

The team firmly believes that costs should not be a barrier to justice, and this is just a natural extension of the substantial pro bono services we offer to athletes in need, from acting for clients in successful overdue payables claims at FIFA to helping women’s footballers establish their image rights structures via our Women In Football pledge.

Mohit Pasricha, Angelique Richardson, Jake Cohen and William Bowyer are all delighted to be appointed to the service and are proud to continue our work in protecting athletes and their rights.

Learn more about Sport Resolutions Pro Bono Service here: https://www.sportresolutions.com/services/pro-bono-legal-advice

12-month bridge loan secured for Blue Shield Capital

Posted on: July 4th, 2024 by Hugh Dineen-Lees

We are pleased to share with you that we have acted on a £6 million loan for our clients Blue Shield Capital on the refinance of three stabilised, income-producing residential assets.

This £6 million facility will allow the borrower to facilitate a restructure of their group operations and refinance some of their property portfolio in order to expand their business.

Ajoy Bose-Mallick Director and Head of Banking led the team with assistance from Senior Associate Ashley Wright & trainee Alex Ruder on banking and Paul Marsh Director on real estate.

Commenting on this transaction, Ajoy Bose-Mallick said “we have completed on another important funding facility for our clients which will expand their loan book and showcase their ability to fund larger complex transactions. Again this deal highlighted the Banking and Real Estate Finance team working seamlessly together to deliver on a successful completion for our clients.”    

General Election 2024 – what are the various parties’ proposals relating to employment law?

Posted on: July 4th, 2024 by Natasha Cox

While many may feel that the outcome of today’s General Election is a foregone conclusion, we felt it was important to look at each of the political parties’ manifestos to consider what they are proposing in the field of employment law – and what the consequences of these might be. 

Some of the parties have announced extensive proposals (which could mean the Lawrence Stephens’ Employment team will be extremely busy over the coming months!) while others have caused us to wonder how they will be implemented in light of recent court rulings / existing legislation.

If you have any questions on how the general election may affect your obligations as an employer, please contact any member of our Employment Team (see end of article).

Labour

In summary, Labour propose to:

  • Introduce a day one right to sick pay, parental leave and unfair dismissal;
  • Extend Employment Tribunal time limits for bringing all claims from three months to six months;
  • Ban “exploitative” zero hours contracts (which means an outright ban on such contracts is unlikely);
  • End fire and rehire (although Labour’s New Deal document indicates they would stop short of an outright ban);
  • Set up a single enforcement body to enforce workers’ rights;
  • Alter the criteria for determining national minimum wage so all adults are entitled to the same minimum wage;
  • Create a “Fair Pay Agreement” to allow for sectoral collective bargaining in the adult social care sector;
  • Give employees the right to have a contract which reflects the hours they regularly work based on a 12-week reference period;
  • Require employers with more than 250 employees to have a menopause action plan;
  • Place new duties on large employers to produce ethnicity and disability pay gap reports;
  • Make collective redundancy consultation requirements dependent on the number of redundancies across the whole business rather than the number at each ‘establishment’;
  • Require section 1 statements to inform staff of their right to join a trade union;
  • Introduce a right to ‘switch off’;
  • Consult on an eventual move towards a single status of worker, incorporating all but the genuinely self-employed;
  • Make flexible working a default right unless employers have a ‘good reason’ to refuse it;
  • Reverse the changes made under the Trade Union Act 2016 (which placed more stringent requirements on those engaging in industrial action);
  • Abolish the Strikes (Minimum Service Levels) Act 2023;
  • Remove the requirement for fully postal ballots for industrial action;
  • Make it easier for unions to gain recognition;
  • Give trade unions the right to access workplaces for recruitment and organising purposes; and
  • Introduce a right to unpaid bereavement leave (which is currently only available following the death of a child).

The full manifesto can be found here: https://lnkd.in/eFZQ_mva

Conservatives

In summary, the Conservatives propose to:

  • Overhaul the fit note system to move responsibility from GPs to other healthcare professionals;
  • Continue with the implementation of minimum service level agreements in relation to industrial action;
  • Cut employee National Insurance contributions to 6% from 2027; and
  • Abolish National Insurance for self-employed people by the end of the next parliament.

It’s worth noting that the first two proposals are not new – a consultation on the fit note system had already started before the General Election was called and we already knew the Government planned to introduce minimum service levels during strikes in hospitals and schools. It looks largely like business as usual if the Conservatives are successful.

The full manifesto can be found here: https://lnkd.in/ekQNictf


Liberal Democrats

In summary, the Lib Dems propose to:

  • Establish a new ‘dependent contractor’ employment status between ‘employment’ and ‘self-employment’, with entitlements to basic rights such as minimum earnings levels, sick pay and holiday entitlement;
  • Increase minimum wage by 20% for people on zero-hour contracts at times of normal demand to compensate them for the uncertainty of earnings;
  • Promote employee ownership by giving staff in listed companies with 250+ employees a ‘right to request’ shares;
  • Change the burden of proof in Employment Tribunal claims so that the employer has to disprove employment status, rather than the employee proving it;
  • Improve Statutory Sick Pay by removing the 3-day waiting period and lower earnings limit;
  • Extend the use of name-blind recruitment processes;
  • Make parental leave and pay day 1 rights;
  • Double Statutory Maternity Pay and Shared Parental Pay to £350pw;
  • Introduce a ‘use it or lose it’ month for fathers and partners, paid at 90% of earnings;
  • Introduce new Equality Act protected characteristics of ‘caring’ and ‘care experience’;
  • Require large employers to publish data on gender, ethnicity, disability, and LGBT+ employment levels, pay gaps and progression, and publish five-year aspirational diversity targets;
  • Introduce specialist disability employment support and simplify the Access to Work scheme; and
  • Introduce ‘Adjustment Passports’ to record the adjustments, modifications and equipment a disabled person has received, and ensure that Access to Work support and equipment stays with the person if they change jobs.

While there are undoubtedly some proposals that will be attractive to the electorate, the proposed introduction of ‘dependent contractor’ employment status seems to be something of style over substance – aren’t these people already classified as ‘workers’? In addition, the proposed introduction of new protected characteristics of ‘caring’ and ‘care experience’ seems fraught with difficulties – it would certainly keep us employment lawyers busy with the courts grappling to put into practice what these terms actually mean…

The full manifesto can be found here: https://lnkd.in/ehU4gcMw

Reform

In summary, Reform UK intend to:

  • Abolish IR35 rules to support sole traders;
  • ‘’Scrap thousands of laws that hold back British business and damage productivity, including employment laws that make it riskier to hire people’’;
  • Replace the Equality Act 2010;
  • Scrap all Diversity Equality and Inclusion roles that, “cost huge sums, create division, inequality and exclusion, and reduce productivity.’’; and
  • “Scrap EU Regulations with immediate effect. British Laws on [employment] are still based on EU regulations.”

I think it’s fair to say that Reform UK’s manifesto is somewhat light on the detail of how they plan to achieve the above…

The full manifesto can be found here: https://lnkd.in/eMYNR6Qr


Plaid Cymru

In summary, Plaid Cymru intend to:

  • Support the devolution of employment law to Wales;
  • Make paid bereavement and miscarriage leave a day 1 right;
  • Extend the entitlement to statutory bereavement leave and pay entitlement to all people with a ‘close relationship’ to a person who has died;
  • Increase Statutory Sick Pay (SSP) in line with Statutory Maternity Pay (SMP) and remove the lower earnings limit;
  • Reform Shared Parental Leave;
  • Consider making Carer’s Leave paid;
  • Re-introduce the ‘bankers’ bonus cap’
  • Implement an apprenticeship living wage and pay social care workers at least £1 above the real living wage;
  • Investigate increasing higher earners’ National Insurance contributions and promote employee ownership models;
  • Reverse “the Tories’ regressive anti-strike legislation”;
  • Support legislation to tackle insecure work and outlaw fire and re-hire tactics;
  • Abolish compulsory zero-hours contracts;
  • Establish the right to ‘disconnect’;
  • Promote LGBTQ+ inclusion throughout society, including all workplaces, and propose a simplified, de-medicalised gender self-identification system;
  • Adopt the United Nations Convention on the Rights of Disabled People into UK law and introduce a Business, Human Rights and Environment Bill which would mandate that private companies conduct due diligence in their supply chains to prevent human rights abuses; and
  • Put the power to decide Bank Holidays in Wales in the hands of the Senedd and make St David’s Day a Bank Holiday in Wales on 1 March each year.

There’s definitely some overlap here with the other manifestos described above (i.e. Labour’s pledge regarding the right to disconnect, as well as increasing SMP and SSP, reforming zero hours contracts and making some employment rights available from day 1).

However there are also some issues that are likely to be divisive, such as the proposal to introduce a simplified, de-medicalised gender self-identification system. How will this work in practice in light of such decision as Adams v Edinburgh Rape Crisis Centre, Meade v (1) Westminster City Council; and (2) Social Work England and Forstater v CGD Europe?

The full manifesto can be found here: https://lnkd.in/enRssnpZ

SNP

In summary, the SNP intend to:

  • Support the devolution of employment law to Scotland to enable changes such as banning ‘exploitative’ zero hours contracts and ‘fire and rehire’, as well as increasing the level of the National Minimum Wage and removing the age brackets;
  • Create a single status of ‘worker’ for all but the ‘genuinely self-employed’;
  • Increase access to statutory sick pay by removing the lower earnings limit and the waiting period;
  • Increase the rate of Statutory Maternity Pay to 100% of average weekly earnings for the first 12 weeks, dropping to 90% of average weekly earnings or £150 (whichever is lower) for 40 weeks;
  • Increase the available period of Shared Parental Leave from 52 to 64 weeks with the additional 12 weeks to be the minimum taken by the father on a ‘use it or lose it’ basis to encourage better uptake of the statutory right; and
  • Support the repeal of the Strikes (Minimum Service Levels) Act 2023 and the Trade Union Act 2016

Any of this sounding familiar?

The full manifesto can be found here: https://lnkd.in/eh5YiBKj

Greens

In summary, the Green Party intend to:

  • Repeal anti-union legislation and introduce a ‘positive’ Charter of Workers’ Rights, containing a right to strike and a legal obligation on employers to recognise trade unions;
  • Remove ‘arbitrary’ ballot thresholds and requirements for postal ballots;
  • Overturn bans on secondary picketing and industrial action for political objectives;
  • Introduce a maximum 10:1 pay ratio for all private and public-sector organisations;
  • Increase the national minimum wage to £15 an hour, regardless of age;
  • Campaign for ‘safe sick pay’;
  • Provide equal rights for all workers from their first day of employment, including platform workers, zero hours workers and those working in the ‘gig economy’;
  • Properly fund the enforcement of workers’ rights and abolish tribunal fees;
  • Move to a four-day working week;
  • Transition towards a green economy, led by workers and trade unions;
  • Establish an Offshore Energy and Skills Passport so that workers can transition between offshore energy industries;
  • Require all large and medium-sized companies to carry out equal pay audits, redress any inequalities and extend pay-gap protections to all protected characteristics;
  • Introduce a right to flexible working and ensure disabled workers have the in-job support they need, as well as ‘proper pay and conditions’;
  • ‘Defend’ the Human Rights Act 1998 and continued access to the European Court of Human Rights;
  • Protect the right to religious expression and support gender self-identification for trans and non-binary people; and
  • Push for a precautionary regulatory approach to the development of AI, ensuring that workers’ rights and interests are respected when AI leads to significant changes in working conditions.

The full manifesto can be found here: https://lnkd.in/emtteMbV

If you have any questions on how the general election may affect your obligations as an employer – or any other employment law concerns, please contact any member of our Employment Team (see below).

Changes to the obligation to inform and consult on TUPE transfers

Posted on: July 1st, 2024 by Natasha Cox

Changes to the Transfer of Undertakings (Protection of Employment) Regulations 2006 (‘TUPE’) come into effect on 1 July 2024.

These changes are likely to be welcomed by small to medium-sized businesses as they provide greater flexibility to employers in complying with their duty to inform and consult affected employees in relation to a TUPE transfer.

A business preparing for the sale of part or all of an undertaking or service provision can now consult directly with affected employees if:
– there are no recognised trade union or employee representatives AND
– the employer has not already invited the affected employees to elect representatives AND
– either the employer has fewer than 50 employees OR
– fewer than 10 employees will transfer.

There is nothing to prevent an employer in either scenario from arranging an election to vote for employee representatives if this is preferred.

Please get in touch if you require any advice as to how to get the process right for your business. A failure to do so can be costly: transferors and transferees are jointly liable for any breach of the duty to inform and consult. This could result in protective awards reaching as high as 13 weeks’ gross pay for each affected employee.

Lawrence Stephens advises Mario Silva on first promotional deal with Boxxer

Posted on: June 25th, 2024 by Natasha Cox

The Sports & Entertainment team, led by Angelique Richardson, has advised professional boxer, Mario Silva, together with Merah Vodianova and Elliott Amoakoh of Nova Sport Group, on Mario’s first promotional deal with Boxxer.

Silva, with a current record of 5-0, is one of the youngest fighters in Boxxer’s stable at only 21, and is looking to be the next greatest middleweight of the generation. Mario will make his debut with Boxxer on 3 August 2024 on the Chelli v Simpson undercard at Oakwell Stadium, Barnsley.

Commenting on the deal, Mario said “I’m ready. Nova and Angelique have changed my life getting this deal over the line. I’m one step closer to my purpose and mission in this life”.

Angelique said: “This deal is life-changing for Mario – I’m thrilled to have advised him and Nova on this deal and we’re all really excited to see what Mario can bring to the middleweight division.”

Lawrence Stephens appointed to Glenhawk’s Panel of Solicitors

Posted on: June 20th, 2024 by Yvonne Uzoka

We are delighted to share that Lawrence Stephens has been appointed as a panel firm by Glenhawk, the award-winning short-term real estate lender.

This strategic partnership comes in the wake of Glenhawk’s announcement earlier this year that it has secured substantial funding to bolster its lending capacity and enter the buy-to-let market. With a continuing drive to remain competitive and market-leading in the bridging finance space, Glenhawk are revamping its range of unregulated and regulated products while introducing new products in order to deliver an ongoing programme of growth.

Lawrence Stephens will play a crucial role in supporting Glenhawk’s growth objectives. With a commitment to excellence and delivering top-tier legal services, there is an alignment with Glenhawk’s ethos of quality and integrity within the industry.

Guy Harrington, CEO of Glenhawk, commented: “Lawrence Stephens’ reputation as a well-established high-quality law firm makes them a welcome addition to our panel solicitors. We’re delighted to be working with Greg and his team.” 

Director and Head of Real Estate Finance, Gregory Palos, added: “Our multi-disciplinary firm has a long track record of being a people business devoted to delivering a high-quality personal service to clients. We’re proud to be supporting Glenhawk in the next step of their lending journey.”

Lawrence Stephens looks forward to this collaboration with Glenhawk that promises to enhance the lending landscape and deliver exceptional service to clients across the board.

William Bowyer discusses the importance of protecting athletes’ image rights in Law360

Posted on: June 18th, 2024 by Natasha Cox

Associate William Bowyer discusses athletes’ image rights following an award of €200,000 to the family of former Formula One champion Michael Schumacher, over publication of an AI-generated interview of him in Die Aktuelle magazine, in Law360.

Will’s article was published in Law360, 14 June 2024.

—————————————————————————

F1 driver AI case sheds light on winning tactics in IP suits

Athletes should ensure they protect their image, both via the contracts they enter into, such as sponsorship and broadcast deals, as well as by monitoring use of their image online. This will require considerable tenacity given that an uploaded image generated by artificial intelligence can suddenly go viral.

In this context, a decision by a Munich Labor Court to award €200,000 ($216,215) to the family of former Formula One champion, Michael Schumacher, which was reported in May[1] could set a precedent for athletes in image rights cases.

Although the circumstances of this case were highly unusual, given Schumacher’s profile and the nature of the interview in the article, the controversy over presenting quotes generated by AI as a genuine interview with Schumacher indicates that publishers cannot simply take advantage of the latest technology to behave less responsibly.

Indeed, the admission by publisher, Funke Mediengruppe that the April 2023 article in Die Aktuelle magazine was “tasteless and misleading”[2] indicates that athletes remain in a strong position when it comes to protecting their image and reputation.

Instead of encouraging media outlets to be ever more cavalier, this case implies that positive outcomes for sports personalities who take an aggressive and proactive approach remain achieveable.

The Schumacher case has opened the door for a wave of issues surrounding circumstances where third parties misuse image rights or create digital representations of real people without their authority.

In this particular example, the facts of the case indicate brazen misrepresentation on the part of Die Aktuelle. On the front cover of the edition in question, the headline ‘Michael Schumacher, the first interview!’ ran next to a photograph of the celebrity.

The magazine also wrote that “it sounds deceptively real”, with supposed, AI-generated quotes attributed to Schumacher. Only when reading the article on the inside pages did it become clear that the quotes had been produced by an AI tool.

Schumacher, the winner of seven F1 titles, has not been seen in public since being in an induced coma after suffering severe head injuries in a skiing accident in December 2013. The headline, which blatantly misrepresented reality, was obviously a ploy designed to attract maximum attention to potential readers not looking beyond the front cover.

Two days after publication, the magazine’s editor-in-chief Anne Hoffmann, who had held journalistic responsibility for the paper since 2009, was sacked and Bianca Pohlmann, managing director of Funke media group, apologised to Schumacher’s family.

Schumacher’s family was able to use Funke’s admission of responsibility and poor judgment against the publisher to reach a settlement, along with the fact that they wanted to reduce the public attention on this case as much as possible.

The battle between celebrities or brands and imitators is by no means a new phenomenon, and athletes and sports personalities work hard to protect the intellectual property and brand in their image, voice and likeness.

For instance, in February 2024, French football star Kylian Mbappé applied to European Union Intellectual Property Office to register a black and white logo depicting his crossed-arms celebration as a trademark[3] for  clothing, footwear, games, sports equipment, accessories, luggage, and printed matter such as books and magazines.

In doing so, he followed a path pioneered by his former Paris Saint Germain teammate Lionel Messi. Messi, who set the precedent, was engaged in a nine-year legal battle before the European Court of Justice finally approved his registration in September 2020 of an EU-wide trademark for a logo consisting of his name and a stylized letter ‘M’[4].

Seeking to monetise their image and using the law to proactively build their brand, Mbappé’s move is part of a wider trend by sports stars and celebrities to protect IP rights relating to their signatures, names, and other personal characteristics. Trademarking a logo, symbol, name or other similar mark grants these owners a monopoly right over their IP assets and helps to stop third parties from using their image without consent or payment.

While athletes have looked to the law to protect their brand and visual identity from copycats, the boom of generative AI has led to a slew of legal claims surrounding IP. Globally, lawyers are already seeing a rise in AI-related litigation surrounding image rights, and the German court’s decision will no doubt add to the momentum.

Another case, which could set a legal precedent in the UK, is the dispute between Getty Images and Stability AI[5], a London-based AI developer, which was filed in June 2023 and is currently pending trial before the High Court of Justice of England and Wales.

Getty claims that Stability AI is responsible for infringing its IP rights through the development of its Stable Diffusion system, which automatically generates images based on text or image prompts input by users. It argues that the synthetic images generated by AI in this instance reproduce in substantial part its copyrighted works.

Separately, in January 2023, a group of artists filed a claim against Stability AI in the U.S. District Court for the Northern District of California after one of them discovered that over 50 pieces of her artwork had been uploaded to LAION[6], a data set which feeds artificial intelligence image generators including Stable Diffusion.

The EU AI Act[7], which has been at the vanguard of legislation racing to catch up with the technology, proposes that AI tools will have to disclose any copyrighted material used to train their systems. As AI becomes more embedded into the workstreams of both online and print publications, it is likely that many more of these cases will occur.

While you cannot use someone’s image without their consent to sell or promote goods or services under both UK and EU IP law, there are exceptions when reporting the news. In the Schumacher case, however, Die Aktuelle were representing that the interview was both genuine and endorsed by his family in an attempt to sell their magazine.

Many well-known figures have already found their reputations damaged by such AI-generated images, which are so convincing that they are widely shared online – a scenario that athletes and their representatives will need to be ready to counter robustly.

Despite the general uncertainty that the widespread use of AI brings to image rights, the Schumacher case rightly shows a trend towards how athletes are looking to the law to protect their brand, enabling them to place themselves in pole position in image rights cases.

 

[1] https://www.bbc.co.uk/sport/formula1/articles/cd1176240lko.

[2] https://news.sky.com/story/michael-schumachers-family-win-legal-case-over-tasteless-ai-generated-interview-in-german-tabloid-die-aktuelle-13141870.

[3] https://euipo.europa.eu/eSearch/#details/trademarks/018984428

[4] C-449/18 P EUIPO v Messi Cuccittini and C-474/18 P J.M.-E.V. e hijos v Messi Cuccittini

[5] Getty Images v Stability AI [2023] EWHC 3090 (Ch)

[6] Andersen v. Stability AI Ltd., 23-cv-00201-WHO

[7] https://digital-strategy.ec.europa.eu/en/policies/regulatory-framework-ai