NEW DELHI: Lalit Modi and his outfit Modi Entertainment Network (MEN) have not had the best of journeys in recent times. MEN has had a string of losses including ESPN and Walt Disney.

The decade-long ding-dong relationship between international fashion channel FTV and its Indian licensee owned principally by MEN has once again surfaced in the Supreme Court, with the Indian licensee seeking to restrain the foreign channel from taking on any other business ventures in India till their dispute is resolved.

The matter in the apex court ? now listed for hearing on 20 January ? relates to a decision in March 2010 by Fashion Television BVI, the global broadcaster of FTV, to terminate its contract with the Indian partner Fashion Television India Pvt. Ltd following differences over sharing revenue and outstanding payments.

The Delhi High Court on 24 May last year restrained FTV from terminating the agreement. This injunction was later removed by an arbitral tribunal.

Austria-based FTV Programmgesellschaft mbH is the parent company of the FTV brand, owned by Michel Adam Lisowski.

FTV and its Indian partner had concluded a five-year agreement in August 2001which included broadcasting rights in India and franchising fBars, the channel?s branded night clubs. This could be automatically extended by another seven years if a joint venture company was not formed between the two parties.

Initially, FTV India was to pay its foreign partner a minimum guarantee of $720,000 per annum and the channel was encrypted for Indian viewers.

However in 2003, FTV Paris went free-to-air via satellite Asiasat 2, leading to a dispute between the two sides over revenue sharing and outstanding payments.

In June 2003, FTV had prepared a civil-criminal charge against Lalit Modi and the Modi Group in France and in India.

FTV had alleged that the Modi Group had been entering into agreements selling the Fashion Bars concept to third parties and collecting substantial advance payment. It said the Modis should have sought written permission to engage Fashion TV in long-term partnerships or franchising agreements.

The Delhi High Court in June 2003 had issued a show cause notice for contempt of court against Fashion TV Paris for not complying with its order of 19 May 2003 directing FTV to re-encrypt the signal of its channel, preventing it from being free-to-air. It also restrained Fashion TV Paris from entering into any third party agreements for distribution, advertising, merchandising and licensing rights.

The order made it clear that no Indian company or group of companies could get into any business arrangement with FTV directly for business purposes in India and the SAARC region without the written consent of the Modi Group, and FTV could not get into any business arrangement in India and the Saarc Region without a consent from the Modi Group. Any such business arrangement was to be in direct violation of the Delhi High Court Order.

But in May 2004, FTV said it had resolved all differences with MEN after a year‘s battle in the Delhi High Court, and an agreement was reached between Lalit Modi and the FTV boss Michel Adam. MEN continued to control FTV India.

FTV India with its India-specific beam agreed to step up its Indian content by developing new shows and vignettes and showcasing Indian fashion, lifestyle and music.

FTV ? which had been launched in 1997 as the world?s first television network entirely dedicated to fashion, beauty and style - had agreed to return to the pay mode once the reworked distribution arrangement set in by the end of 2004.

It is present in over 130 countries on 5 continents through 31 satellites and over 1000 cable systems. Broadcast by leading global media groups such as Eutelsat, BSkyB and Astra C, Fashion TV has a confirmed reach of over 130 million households.

MUMBAI: The Enforcement Directorate (ED) has issued a notice to cricket?s richest board, the BCCI, to explain transfer and routing of funds to the tune of Rs 16 billion in the conduct of the second season of Indian Premier League cricket tournament.

The notice has been issued under the provisions of the Foreign Exchange Management Act (Fema) regarding transfer of funds for the second edition of the IPL, which was conducted in South Africa in 2009.

Besides the BCCI, the notice has also been marked for former IPL chairman and commissioner Lalit Modi, asking for an explanation of the transfer of these funds.

MUMBAI: The Supreme Court today dismissed former IPL chairman and commissioner Lalit Modi?s plea seeking reconstitution of the BCCI?s three member disciplinary panel that is conducting a hearing into financial irregularities done during his tenure.

Modi had moved the Supreme Court after the Bombay High Court had dismissed a similar plea back last year. The SC noted that there should be a "real danger of bias" and "not just an apprehension of bias".

A bench comprising Justices JM Panchal and H.L. Gokhale said that the three-member committee was validly constituted by the BCCI.

"Mere apprehension of biasness cannot be a ground to reconstitute the committee," the Bench said.

MUMBAI: The former IPL chairman Lalit Modi has said that the BCCI could lose Rs 20 billion over the termination of the Kochi IPL franchise.

On twitter, Modi wrote: "Kochi now being terminated - a further loss of 1500 crore to BCCI. Compounded by reduction in Media Rights. My estimate 2000 crore. Who is responsible for this mess now? Current president and outgoing president for sure. Who will they blame now for this. Where is the accountability and who will take responsibility,"

Expressing a sense of vindication over the mess, he wrote on his blog that the BCCI?s termination of the Kochi Tusker?s IPL franchise for non-payment of a bank guarantee is a financial mess he had predicted over a year ago. This was a mess he was prevented from trying to avoid during his time as IPL commissioner, he added.

"The news, which came out of the BCCI AGM in Mumbai, is another example of how the vendetta against me is being laid bare.?

Modi said that he had proposed a financial condition that would filter out all but the most serious and robust of bidders. This condition stipulated that bidders should have a capitalisation of no less then $1 billion and was created to ensure they had the ability to support an IPL franchise.

A commissioned report compiled by Ambit and KPMG confirmed that 73 Indian companies had a net worth above $1 billion and 156 had market capitalisation above that figure.

?So we knew there was a significant market at this level. Furthermore, with the reserve price for a franchise set at $225 million, the net worth of a successful bidder would be at least four times the reserve price of a new IPL team; a further safeguard against a consortium investing beyond their means.

?Its also interesting to note that part of the BCCI requirement was to generate interest from bidders for whom an IPL franchise was neither its sole, or its main business. Capitalisation of at least four times the reserve price, would ensure that bidders would clearly have other, significant interests and would also help to ensure their ability to meet annual payments over the required ten-year franchise period. In summary then, the BCCI wanted involvement from those who already had credibility, not those for whom the IPL would provide it.?

For some reason, the BCCI had a late change of heart and, after approving the initial conditions, they effectively brought more bidders into the mix by requesting lower the capitalisation requirement.

?After the award of the franchises to Kochi and Pune, the issue was compounded by my unease with the make up of the consortium which successfully bid for Kochi. Within the shareholding, there were members who were not bearing any of the risk and simply enjoying the potential benefits. This, of course meant others were subjected to a greater proportion of responsibility and I believed such an arrangement could result in potential default at some point - and problems for the IPL," he wrote.

Modi noted that 18 months later, the BCCI has terminated the Kochi contract on the basis of an unpaid bank guarantee which, according to new President N Srinivasan, ?....is not capable of being remedied." As a consequence, the BCCI now stands to lose more than $300 million by virtue of reduced commercial revenue because Kochi?s suspension means fewer teams and therefore games - not to mention a loss of credibility for the IPL itself.

Modi said it will be interesting to see who takes responsibility for an outcome he had predicted even before the contract was signed. ?It is a situation that could have been avoided but what it shows is that the unsubstantiated accusations made against me suggesting I imposed ?onerous? conditions purely to try and manipulate the bidding process towards my preferred bidders has been shot to pieces.?

MUMBAI: India?s cricket board has scrapped the contract of Indian Premier League (IPL) franchise Kochi Tuskers Kerala for breaching its terms and conditions, setting in process the possibility of a lawsuit.

The Board of Control for Cricket in India?s new president Narainswamy Srinivasan said today the decision to "terminate the franchise" was over payment issues.

The Kochi franchise defaulted on a Rs 1.56 billion annual payment it was to make as bank guarantee.

Srinivasan, who took over the reins as BCCI president from Shashank Manohar, said the board will encash the annual bank guarantee in order to recover the dues that the franchise owes.

"Because of the irremediable breach committed by the Kochi franchise, the BCCI has decided to encash the bank guarantee in their possession and also terminate the franchise," he stated at a media briefing after the board?s annual general meeting here today.

Asked if the BCCI would reconsider its decision and give the franchise a chance to return, Srinivasan bluntly rejected such a suggestion. "No, we have terminated the franchise because the breach is not capable of being remedied."

The consortium behind the kochi franchise has threatened legal action against the BCCI. Earlier the franchise owners had wanted a reduction in their fee on account of the number of their matches being reduced.

Added to the IPL last season as one of the two teams along with Pune Warriors, the Kochi franchise has been at the centre of controversy from its inception with former IPL chairman Lalit Modi questioning the shareholding pattern.

The IPL, which consists of ten city-based teams, will have its governing council take a decision on whether to have another auction for a new franchise.

In March 2010, the Sahara group had bid $370 million to own the Pune franchise while Rendezvous Sports World offered $333.33 million for Kochi.

For the record, this is the third franchise whose contract the BCCI has gotten involved with. It tried to terminate the contracts of Rajasthan Royals and Kings XI Punjab last year but the franchises got relief from the court. Those matters are still to be settled.

Meanwhile, the BCCI appointed Rajeev Shukla as the new IPL chairman, succeeding Chirayu Amin.

Vilasrao Deshmukh was appointed the Media Committee chairman, Farukh Abdullah is the Marketing Committee chairman, Jyotiradiya Scindia is Finance Committee chairman while G Viswanath replaces Amarnath in the IPL Governing Council. Stepping into Srinivasan?s shoes as BCCI secretary is Sanjay Jagdale.

MUMBAI: Former cricketer Ravi Shastri who is a member of the Indian Premier League (IPL) Governing Council has been summoned by the Enforcement Directorate (ED) to help with their probe into the alleged financial irregularities in the running of the event during its first three seasons.

Currently Shastri is doing commentary for Star Cricket‘s telecast of the India versus England series.
 
ED officials said that Shastri was summoned as he was a member of IPL‘s governing council and would be aware of major decisions, concerning franchises, taken at that time.
 
Shastri and former Indian captains Mansur Ali Khan Pataudi and Sunil Gavaskar were the three governing council members who worked under the then IPL chairman and commissioner Lalit Modi.