Ex-Liverpool owners in court seeking damages

LONDON — The bitter court battle over the sale of Liverpool football club resumed Wednesday with the former American co-owners seeking approval to pursue a $1.6 billion damages claim for what they called a "giant swindle."

The case in London comes as Liverpool's fortunes on the pitch have been revived for the first time since Tom Hicks and George Gillett Jr. were forced to sell the club against their will to the owners of the Boston Red Sox in October.

Lawyers for Hicks and Gillett need a High Court judge to lift an order preventing them from pursuing damages against the Royal Bank of Scotland and three then-club directors who approved the 300 million-pound (then $476 million) sale to New England Sports Ventures.

In October, Hicks and Gillett had to withdraw a temporary restraining order blocking the sale, which they had obtained in a Texas court, to avoid being declared in contempt of the London court.

"There is no settled decision by us to sue in England or abroad," Paul Girolami, representing Hicks and Gillett, told London's High Court on Wednesday.

Hicks has claimed "the British Establishment" conspired to sell the club for less than half of what it was worth to NESV, which is led by Red Sox owner John Henry.

RBS, which held the bulk of Liverpool's debt, wants to prevent the former owners from suing the bank in the United States, where the original suit was filed claiming the Liverpool board ignored other more lucrative offers and excluded the duo from takeover talks.

"RBS isn't seeking to stop Hicks, Gillett or any of their companies from suing," Richard Snowden, representing RBS, said in court. "If they want to do so they are free to provided they do it in this jurisdiction (Britain)."

NESV also wants a permanent anti-suit order blocking action outside the U.K. and European Union by Hicks and Gillett, who were not in the London court on Wednesday.

Martin Broughton, the club's chairman at the time of the sale, wants a declaration that he behaved reasonably and honestly over the sale, countering the claims of Hicks and Gillett.

Philip Marshall, representing Broughton, said that the British Airways chairman "remains under a cloud."

The case centers around whether Broughton and two other English board members had the power to overrule them and approve the sale to Henry's ownership group.

Hicks and Gillett were forced to put the club up for sale in April after struggling to meet the repayments resulting from their 2007 leveraged takeover. Debts had reached around 285 million pounds at the time of the sale and Hicks and Gillett want damages for the losses they incurred as a result of the NESV buyout.

Liverpool was facing relegation at the time of the sale in October after the team's worst start to a season in around 50 years.

But the 18-time English champions, who fired manager Roy Hodgson and replaced him with Kenny Dalglish, have now won four consecutive matches and are in sixth place in the Premier League.