NIKE INDIA PVT LTD Vs. VIRAT KOHLI

JUDGEMENT

(1.) The appeal arises out of the rejection of the interim order sought for on IA 1 in OS 5906/2013 by the City Civil Court, Bangalore. The prayer in the suit filed by the plaintiff / Nike India Ltd is for declaring the contract between the parties with effect from 1.8.2008 at Document 3 to the plaint stands duly extended till 31.07.2014 vide the plaintiff's communication dated 31.5.2013 in terms of clause 8(a) of the Contract and issue a permanent injunction restraining the defendant or any one claiming through or under him from soliciting, negotiating or entering into any agreement with any third party with respect to the endorsements/service covered by the contract between the parties with effect from 1.8.2008 or from in any manner taking any action inconsistent with the endorsement of the plaintiff's products. Simultaneously, IA 1/2013 is also filed seeking for injunction. However, the trial court declined to grant any interim injunction. Hence, this appeal.

(2.) The facts are: The plaintiff/appellant Nike India Pvt Ltd entered into a contract with the defendant/respondent Mr Virat Kohli titled Cricket Consultant Contract for the period from 1.1.2007 to 31.12.2009, During pendencyof the said contract, the parties entered into a fresh contract for the period 1.8.2008 to 31.7.2013 subject to the right of the appellant to extend the same for a period of 1 year. The said contract, according to the appellant, interalia provided for grant of endorsement rights to the appellant on an exclusive basis in connection with its products as indicated therein and paid trhe respondnet substantial sum of money. It is stated, appellants have adhered to its contractual obligations without any default and the respondent has been fully satisfied with the terms of the contract and the performance thereof of the appellant and has repeatedly applauded the products publicly.

(3.) Clause 8 of the contract provided that NIKE shall have the option to extend this contract for one additional contract year after the expiration of the contract period, upon the same terms and conditions applying in the final contract year of the initial contract period, exercisable by giving written notice of such election to the Consultant not later than sixty days before theexpiration of the initial contract period. It also provided that at NIKE's request, Consultant shall negotiate with NIKE in good faith with respect to the terms of a renwal of this contract. The parties shall not be obligated to enter into an agreement if they cannot settle on mutually satisfactory terms. The Consultant shal not engage in discussions or negotiations with any third party regarding Consultant's wearing, sponsoring, promoting, advertising or endorsing or providing consulting or similar services with respect to, any products after the contract period until sixty days prior to the expiration of the contract. According to the appellant, it being desirous of extending the contract for a period of additional year i.e., from 1.8.2013 to 31.7.2014 pursuant to clause 8(a), duly communicated on 30.5.2013 intimating the respondent of the exercise of its option pursuant thereto and offered to negotiate with the respondent for further renewal of the contract beyond 31.7.2014. However, since the appellant has not accepted the unilateral and unreasonable terms by the respondent for further renewal of the contract as suggested by him, respondent issued a communication on 10.6.2013 making baseless allegations with respect to implementation of the contract and rejected the appellant's extension of the contract vide its letter dated 30.5.2013.