Aerios takes SA Rugby to court

Aerios believes the South African Rugby Union acted “unlawfully in trying to rid itself of Aerios for self-gain”.

Newlands rugby stadium. Picture: WP Rugby

JOHANNESBURG - Aerios Pty (Ltd), the agency which managed the advertising rights of the Western Province Rugby Football Union since 2012, has taken the South African Rugby Union and WPRFU to court for damages amounting to R183 million, based on a three-year inquiry into unlawful conduct.

Aerios believes the South African Rugby Union acted “unlawfully in trying to rid itself of Aerios for self-gain”.

Chief executive director at Aerios, Costas Constantinou, said the papers describe the “undue pressure and abuse of power SA Rugby exerted over Western Province Rugby (Pty) Ltd (WPR) when it threatened to withhold a commercially important test match allocation to Newlands”.

Aerios have instituted the court action on the basis of the information it gathered during the inquiry, which was concluded at the end of 2019.

Based on its findings, it is suing SA RUGBY as the main respondent and also the WPRFU in damages.

Aerios said “these damages were suffered as a result of the loss of extensive agreements that gave Aerios the exclusive rights to sell Western Province advertising at Newlands and/or the Cape Town stadium if Western Province relocated or played fixtures there”.

In addition, Constantinou said Aerios was granted the exclusive rights to create, develop, install and operate Wi-Fi and DAS networks and digital mobile content at Newlands Rugby stadium. Aerios was also awarded the exclusive rights, for a period of 20 years, to develop and operate the official WPR applications from which the digital content could be viewed by supporters.

“However, SA Rugby purposely ignored the rights WPR had granted to Aerios. SA Rugby instead concluded broadcasting and mobile digital agreements with SuperSport. In addition, it concluded agreements with SA RUGBY sponsors, who were awarded certain advertising rights at Rugby matches hosted by SA RUGBY’s various provincial unions.”

“This meant that SA Rugby had granted SuperSport and SA Rugby sponsors commercial rights that WPR had previously committed itself to contractually to Aerios. By acting in these ways, SA Rugby was potentially in breach of its obligations to SuperSport, its sponsors and also to World Rugby.”

Aerios has questioned the validity of the broadcast rights granted to SuperSport and the various commercial rights that SA Rugby maintained belonged to them, and claimed it could dispose of as it wished.

These rights included advertising rights provided to Super Rugby and Currie Cup sponsors and for any international fixture, including the successful IRB Sevens held annually at Cape Town stadium.

Constantinou said that SA Rugby also ignored Aerios’s advertising rights during the 2015/2016 World Rugby Sevens Series matches, which were planned for Cape Town Stadium in December 2015.

“We were set to challenge these rights in arbitration that was set to start a few months before the event,” said Constantinou. “And the outcome would have established who rightfully held the rights to the advertising at the prestigious Cape Town event. But SA Rugby’s opposition to the Aerios contract culminated in its CEO, Jurie Roux, issuing a number of threats to the then WPRFU President, Thelo Wakefield. In them, Roux stated that SA Rugby would not allocate an upcoming test match between South Africa and New Zealand to the Newlands Rugby stadium.”

“For WPRFU and WPR, not being allocated a test match would have had catastrophic financial consequences,” asserts Constantinou. “Ultimately, this serious threat, together with the various commercial rights challenges, provided a strong motivation for both SA RUGBY and WPRFU to find a way of freeing WPR of its agreements with Aerios.”

Reports suggest that both SA Rugby and Western Province have denied the claims.

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