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Why stalling wouldn't be out of place in Lotus hearing

Legal experts Collyer Bristow say it would come as no surprise to hear either side in the Lotus naming row call for extra time to prepare for court.

The 2011 F1 season could not have got off to a more tempestuous start with the cancellation of the Bahrain Grand Prix, which was due to have taken place yesterday [Sunday], but, while ten of the teams can now set their sights on Melbourne, two others have another important date prior to the rescheduled opening round.

The rumbling dispute over naming rights between Tony Fernandes' Team Lotus and Group Lotus, which owns the brand's road-going concern and recently decided to partner Renault in F1, is due for another court appearance a week from now, with all concerned hoping that a resolution can be reached one way or another.

Tony Fernandes contends that Group Lotus illegally terminated the five-year branding licence it had granted his 1Malaysia Racing Team four years early in late 2010, the outfit's maiden campaign in the top flight during which it ran as Lotus Racing – ostensibly because the ultra-ambitious Bahar wanted to leap onto the bandwagon of the massive resurgence of interest in Lotus and use the name for Group Lotus' own F1 foray with Renault, a team that he considered to be a better and more competitive vehicle for the company's promotion.

Fernandes has already laughed off a couple of attempts at an out-of-court settlement by his rival, claiming that the amount of 'compensation' on offer would still bankrupt his team, and appears determined to have his day in court, confident that he will be allowed to retain the rights to use the Team Lotus moniker he acquired from David Hunt late last year. Group Lotus, meanwhile, is equally optimistic that it can force Fernandes to relinquish those rights, and turn out in Melbourne under a new guise.

Legal experts, however, insist that neither party is likely to be as well prepared as they could be for the showdown, which Justice Peter Smith hopes will settle the matter once and for all. While there could still be four Lotus-Renaults on the grid at Albert Park, as the case could take several weeks to resolve, the judge has already said that delaying proceedings until the end of the season would be to all the embarrassing - and damaging - dispute to persist for far too long [HERE].

However, experts at leading law firm Collyer Bristow, which specialises in motorsport matters, have said that they would not be surprised to hear one or both of the parties call for a stay of execution ahead of the court date.

“With only eight weeks to prepare for trial since the failed summary judgment application, it wouldn't be a surprise if one or both parties in the Lotus dispute applied for a postponement,” comments associate Tim Lowles, “Litigation of this scale – involving a number of complex elements – requires a huge amount of time to be invested upfront by both legal teams. Disclosure and witness statements alone would normally take more than two months to pull together.

“This has a knock-on effect on the costs of the litigation as the lawyers on the case will no doubt have been working extremely long hours in preparation. If the trial does go ahead, and takes the full two weeks anticipated, then the total costs payable by the losing party could exceed the £1m mark - and this is on top of any costs incurred in rebranding the team and the cars and loss of sponsorship.

“Whatever the outcome, it will be interesting. If a settlement out of court cannot be reached prior to 21 March, we are likely to see four cars with Lotus branding lining up on the starting grid in Melbourne. If a settlement can be reached, there will probably be a frantic, last-minute, need for a total rebrand of one team, including its cars.”

Thanks to our colleagues at Collyer Bristow. For more information, click on the following link: Motorsport Law

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Alan D - Unregistered

March 14, 2011 10:11 PM

Nanbawan, I'd agree, Genii's objective is to turn the team into a solid long-term prospect. Its not the sort of VC company that makes a quick buck out of asset stripping, and it doesn't want to get into F1 itself. It absolutely doesn't want it to be Team Genii F1. They appear to have a long term plan to get Lotus involved, but in a well-planned way so it doesn't become a millstone around Lotus's neck, and so that if Lotus pulls out it won't wreck the F1 team either. All in all, I'd say they are taking a very responsible approach to getting this team up and running and don't want it to be yet another of these "here today gone tomorrow" teams.

Nanbawan - Unregistered

March 14, 2011 9:47 PM

I don't have the details in their agreement but even in the case of Group Lotus losing their case, it won't make them change the name of the Lotus Renault GP team, since they're a sponsor bearing the name of a parent company. Anyway, it would a thorn in their plan to have the team simply named Lotus after 2012 regardless of who own the majority of shares. But I think Genii indeed wants the team to be re-branded as such.

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