Lotus vs Lotus, 2de ronde
Geplaatst: 01 aug 2011, 19:20
Bron: [url=ttp://www.theracedriver.com/2011/08/lotus-vs- ... -revealed/]The Race Driver[/url]
En 't Is ne hele boterham ...
Lotus vs Lotus – Round Two: More Details Revealed
August 1, 2011 – It was Lotus (Team Lotus, owned by Tony Fernandes) vs Lotus (Group Lotus, owned by Proton Holdings) again in the UK’s High Court of Justice last week – in a showdown that was in many ways even more dramatic than their last encounter.
Said Judge Peter Smith J (he of the “De Vinci Code”) in that understated way of his, peering ominously in the direction of Team Lotus’s side of the room:
“If Mr Fernandes’ latest evidence had been presented when it should have been, when this purchase of Caterham had been carried out, my judgment might well have been different….”
He was referring to the previous court battle, when he effectively ruled, on May 28, 2011, that “a large cake represents the ‘goodwill’ of the Lotus umbrella of companies; one part of this cake is called ‘Team Lotus’ and another is called ‘Group Lotus’. ‘Team Lotus’ will have the rights to F1, and to its ancillary benefits; ‘Group Lotus’ will have the rights to everything else.” Along the way, it should be noted – thanks to carelessness on the sides of both parties, he did not rule then on perhaps the most significant point of all – to wit, whether Team Lotus or Group Lotus has the right to call the F1 car a “Lotus”. Fernandes currently brands his F1 cars “Team Lotus” on the nose emblem; Group Lotus are hoping that in time they will be able to call the Renault the sponsor a “Lotus”.
Last week’s hearing was initiated by Group Lotus in response to Fernandes’ purchase of Caterham Cars – a deal that was concluded on April 21 but which had been months in the planning. No mention of the Caterham deal had been made by Fernandes in the first trial.
When asked why he had not brought that imminent purchase to the court’s attention, Fernandes, who was on the stand for two days, replied, “I didn’t think of it; I will have to discuss this with my lawyers (McFarlanes).”
“You didn’t think of it?” replied Judge Smith. “I find that hard to believe….”
The matter was compounded when Group’s barrister, George Hobbs, pointed out that he had had sight of a very limited number of documents relating to the Caterham purchase. In another moment of gravity, Judge Smith turned towards Fernandes and said, “You have until 0900 tomorrow morning to produce all the relevant documents. You are still under oath. If you consult your lawyers about any matters beyond this scope I will take it as contempt of court and you will go to prison.”
Hundreds of pages of documents were examined in detail the next morning. There is clearly no dispute about Team Lotus’s ability to be sponsored by Caterham; the problem arises when Caterham Cars are seen to benefit from Team Lotus as a result of what Hobbs described as “complete integration across all platforms”.
When Fernandes was asked to explain artwork in the Caterham business plan that contained “Caterham Team Lotus” graphics and logo designs, with the word “Team” minimized, he responded, “I’m not sure about this. It must have been some art guy who hadn’t been informed. I haven’t seen these before…”
The Judge was even more moved by a video of the Caterham launch, in which Tony Fernandes appeared on stage wearing Team Lotus apparel, surrounded by Team Lotus logos.
“Why do this, Mr Fernandes,” asked the Judge, “if there is no cross-branding or integration, as you say?”
Fernandes replied that this was merely an example of Caterham benefitting from its sponsorship of Team Lotus, drawing a parallel with Dell or GE, two other Team Lotus sponsors.
Interjected Hobbs: “My Lord, there is a huge difference here. Mr Fernandes owns Caterham. He does not own either GE or Dell.”
“Are you saying, Mr Fernandes,” continued Hobbs, “that, as a brand expert, you think people will distinguish Caterham separately from Team Lotus?”
“Yes,” replied Fernandes. “I don’t see how they could possibly think they are from the same stable.”
“I have to submit,” said Hobbs, “that you don’t believe what you are saying.”
It wasn’t always smooth for Dentons, the law firm representing Group Lotus. When asked several times by the Judge whether they would object to Caterham Sevens being sold in the Team Lotus colours of green and yellow (as per ‘The Prisoner’ Special Edition Caterham of 1989), Hobbs, who is a world-renown expert in Copyright Law, refused to say yes or no, thus infuriating the Judge.
And, prior to judgment, which is expected in mid-August, there consequently remains (to this observer, at any rate) some confusion about the interpretation of Copyright law. Team Lotus argued strongly that Group had failed to produce solid evidence of one specific breach of Copyright; Group replied that the law merely requires them to prove intent of breach, based on evidence – something that was already clear via the “symbiotic, global marketing platform in which Caterham is one of the spokes attached to the hub of the Team Lotus wheel.” The hearing was remarkable for several hours of spellbinding intellectual debate about legal minutae, although Judge Smith did say towards the end of the week that he believed that they had all just about run out of meaningful metaphors!
Group are ultimately seeking an injunction on any of Team Lotus’ activities beyond the scope of F1 – plus possible damages – but one suspects that along the way they were also keen to highlight the absence of the Caterham name from the first trial. Dany Bahar, representing Group, was also on the stand. Like Fernandes, he was pretty quick to pass the baton to his legal team when placed in a corner – as he was, for example, when he was asked why he hadn’t defended the use of the “Lotus” name on the Fernandes F1 cars in 2009 – when Fernandes was leasing the Lotus name from Group Lotus (prior to buying Team Lotus from David Hunt).
It is easy, when F1 fans are exposed to the details of this litigation, to dismiss it as dragging the Lotus name through the mud. As the Judge correctly pointed out, however, the reason for this fragmentation is entirely due to Colin Chapman’s decision to set up scores of different companies around his core business in the 1960s, 1970s and early 1980s. It was also clear that the famous “1985” Agreement is beyond doubt: two years after Chapman’s passing, this basically separated Group Lotus from Team Lotus for ever more – or for as long as the two parties agree not to combine. This, too, was significant, because for much of 2009 Group Lotus seemed convinced that they also owned Team Lotus plus its heritage and goodwill. The first hearing proved that they owned none of those elements.
In my view the whole issue has come to court because neither party – Group or Team – bought Team Lotus from David Hunt before they decided to enter F1. As a result, they are both operating at less than 100 per cent (in terms of their legal rights and benefits). Hunt was a spectator in court throughout the proceedings last week and was mentioned several times by the Judge as the clear owner of Team Lotus prior to an alleged sale of the company to Fernandes in mid-2010. “Mr Hunt could tell us exactly what he owned,” said the Judge at one point, when the two barristers were arguing about the ownership of the Lotus name in F1. The implication was that at least one of the two sides should have used Hunt as a witness; neither did, however – which is probably a good indication of the arrogance and pride involved on both sides.
Arrogance and pride – two very good explanations of (a) why this case is now in phase two; (b) and why both sides, spending vast sums of money on legal fees, argued for too long about basic issues that better-informed observers could have summed up in a few minutes. And the arrogance in this case has bred ignorance: ignorance of the real world was much in evidence in Court 61 last week.
En 't Is ne hele boterham ...
Lotus vs Lotus – Round Two: More Details Revealed
August 1, 2011 – It was Lotus (Team Lotus, owned by Tony Fernandes) vs Lotus (Group Lotus, owned by Proton Holdings) again in the UK’s High Court of Justice last week – in a showdown that was in many ways even more dramatic than their last encounter.
Said Judge Peter Smith J (he of the “De Vinci Code”) in that understated way of his, peering ominously in the direction of Team Lotus’s side of the room:
“If Mr Fernandes’ latest evidence had been presented when it should have been, when this purchase of Caterham had been carried out, my judgment might well have been different….”
He was referring to the previous court battle, when he effectively ruled, on May 28, 2011, that “a large cake represents the ‘goodwill’ of the Lotus umbrella of companies; one part of this cake is called ‘Team Lotus’ and another is called ‘Group Lotus’. ‘Team Lotus’ will have the rights to F1, and to its ancillary benefits; ‘Group Lotus’ will have the rights to everything else.” Along the way, it should be noted – thanks to carelessness on the sides of both parties, he did not rule then on perhaps the most significant point of all – to wit, whether Team Lotus or Group Lotus has the right to call the F1 car a “Lotus”. Fernandes currently brands his F1 cars “Team Lotus” on the nose emblem; Group Lotus are hoping that in time they will be able to call the Renault the sponsor a “Lotus”.
Last week’s hearing was initiated by Group Lotus in response to Fernandes’ purchase of Caterham Cars – a deal that was concluded on April 21 but which had been months in the planning. No mention of the Caterham deal had been made by Fernandes in the first trial.
When asked why he had not brought that imminent purchase to the court’s attention, Fernandes, who was on the stand for two days, replied, “I didn’t think of it; I will have to discuss this with my lawyers (McFarlanes).”
“You didn’t think of it?” replied Judge Smith. “I find that hard to believe….”
The matter was compounded when Group’s barrister, George Hobbs, pointed out that he had had sight of a very limited number of documents relating to the Caterham purchase. In another moment of gravity, Judge Smith turned towards Fernandes and said, “You have until 0900 tomorrow morning to produce all the relevant documents. You are still under oath. If you consult your lawyers about any matters beyond this scope I will take it as contempt of court and you will go to prison.”
Hundreds of pages of documents were examined in detail the next morning. There is clearly no dispute about Team Lotus’s ability to be sponsored by Caterham; the problem arises when Caterham Cars are seen to benefit from Team Lotus as a result of what Hobbs described as “complete integration across all platforms”.
When Fernandes was asked to explain artwork in the Caterham business plan that contained “Caterham Team Lotus” graphics and logo designs, with the word “Team” minimized, he responded, “I’m not sure about this. It must have been some art guy who hadn’t been informed. I haven’t seen these before…”
The Judge was even more moved by a video of the Caterham launch, in which Tony Fernandes appeared on stage wearing Team Lotus apparel, surrounded by Team Lotus logos.
“Why do this, Mr Fernandes,” asked the Judge, “if there is no cross-branding or integration, as you say?”
Fernandes replied that this was merely an example of Caterham benefitting from its sponsorship of Team Lotus, drawing a parallel with Dell or GE, two other Team Lotus sponsors.
Interjected Hobbs: “My Lord, there is a huge difference here. Mr Fernandes owns Caterham. He does not own either GE or Dell.”
“Are you saying, Mr Fernandes,” continued Hobbs, “that, as a brand expert, you think people will distinguish Caterham separately from Team Lotus?”
“Yes,” replied Fernandes. “I don’t see how they could possibly think they are from the same stable.”
“I have to submit,” said Hobbs, “that you don’t believe what you are saying.”
It wasn’t always smooth for Dentons, the law firm representing Group Lotus. When asked several times by the Judge whether they would object to Caterham Sevens being sold in the Team Lotus colours of green and yellow (as per ‘The Prisoner’ Special Edition Caterham of 1989), Hobbs, who is a world-renown expert in Copyright Law, refused to say yes or no, thus infuriating the Judge.
And, prior to judgment, which is expected in mid-August, there consequently remains (to this observer, at any rate) some confusion about the interpretation of Copyright law. Team Lotus argued strongly that Group had failed to produce solid evidence of one specific breach of Copyright; Group replied that the law merely requires them to prove intent of breach, based on evidence – something that was already clear via the “symbiotic, global marketing platform in which Caterham is one of the spokes attached to the hub of the Team Lotus wheel.” The hearing was remarkable for several hours of spellbinding intellectual debate about legal minutae, although Judge Smith did say towards the end of the week that he believed that they had all just about run out of meaningful metaphors!
Group are ultimately seeking an injunction on any of Team Lotus’ activities beyond the scope of F1 – plus possible damages – but one suspects that along the way they were also keen to highlight the absence of the Caterham name from the first trial. Dany Bahar, representing Group, was also on the stand. Like Fernandes, he was pretty quick to pass the baton to his legal team when placed in a corner – as he was, for example, when he was asked why he hadn’t defended the use of the “Lotus” name on the Fernandes F1 cars in 2009 – when Fernandes was leasing the Lotus name from Group Lotus (prior to buying Team Lotus from David Hunt).
It is easy, when F1 fans are exposed to the details of this litigation, to dismiss it as dragging the Lotus name through the mud. As the Judge correctly pointed out, however, the reason for this fragmentation is entirely due to Colin Chapman’s decision to set up scores of different companies around his core business in the 1960s, 1970s and early 1980s. It was also clear that the famous “1985” Agreement is beyond doubt: two years after Chapman’s passing, this basically separated Group Lotus from Team Lotus for ever more – or for as long as the two parties agree not to combine. This, too, was significant, because for much of 2009 Group Lotus seemed convinced that they also owned Team Lotus plus its heritage and goodwill. The first hearing proved that they owned none of those elements.
In my view the whole issue has come to court because neither party – Group or Team – bought Team Lotus from David Hunt before they decided to enter F1. As a result, they are both operating at less than 100 per cent (in terms of their legal rights and benefits). Hunt was a spectator in court throughout the proceedings last week and was mentioned several times by the Judge as the clear owner of Team Lotus prior to an alleged sale of the company to Fernandes in mid-2010. “Mr Hunt could tell us exactly what he owned,” said the Judge at one point, when the two barristers were arguing about the ownership of the Lotus name in F1. The implication was that at least one of the two sides should have used Hunt as a witness; neither did, however – which is probably a good indication of the arrogance and pride involved on both sides.
Arrogance and pride – two very good explanations of (a) why this case is now in phase two; (b) and why both sides, spending vast sums of money on legal fees, argued for too long about basic issues that better-informed observers could have summed up in a few minutes. And the arrogance in this case has bred ignorance: ignorance of the real world was much in evidence in Court 61 last week.
