The outcome of the row between Group Lotus and Team Lotus has been declared a 'score draw' by independent legal experts, who believe that neither party has the right to claim victory in a saga that has tainted the start of the 2011 F1 campaign.

Despite both parties attempting to do just that [see story here], Collyer Bristow's Tim Lowles insists that their refusal to hammer out an amicable solution has led to neither getting their desired outcome, and has left casual F1 fans with the confusion of having two Lotus-branded teams on the grid.

Justice Peter Smith announced his verdict on the long-running affair during the rest day in Monaco, claiming that it was 'unfortunate' that it had even reached the stage of legal proceedings but finding in favour of both parties on separate issues.

"It is unfortunate, in my view, that this case came before the courts and was incapable of resolution beforehand," he wrote in his summary of the case, "However, if the parties cannot agree to resolve a dispute, that is why the courts are here.

"At the end of the day, I cannot help feeling that the parties are better competing against each other on the F1 racetrack. Equally, I cannot help avoiding the feeling that F1 followers would actually find that [the wrangling] enhances F1 and they would be interested to see which of the two Lotus cars was more successful and which then might possibly be better placed to claim to be successors to the Colin Chapman mantle."

Group Lotus came out on top when the judge decided that Team Lotus had indeed breached a licence agreement 'almost immediately after the licence agreement was entered into'. This decision was reached on the basis that Tony Fernandes' operation entered into a number of contracts without prior approval of Group Lotus, particularly in respect of merchandising, which the judge found to be a serious breach.

In his opinion, Group Lotus was therefore entitled to terminate the five-year agreement that had been secured by Fernandes to use the Lotus name, and entitled to damages, albeit in respect of the merchandising breaches only. These damages have not yet been quantified, but Lowles says that he does not expect them to be significant.

The judge also found that Group Lotus was the rightful holder of the 'Lotus' trademarks, but that the 'Team Lotus' registered trade mark should be revoked on the basis of 'non-use', in as far as it had not been used for five years in the context of F1 racing. However, he also found that, after the Lotus company was floated in 1968, both the 'Lotus' and 'Team Lotus' brands were treated separately and that both established a significant amount of goodwill. As such, both parties were entitled to use the marks they claimed to own, with Fernandes having acquired the 'Team Lotus' brand from previous owner David Hunt in order to use it in F1 from 2011 on.

The judge further found that there would be no obvious confusion among F1 followers, with the belief that people would know the difference between the Lotus Renault team and Team Lotus. Group Lotus, however, has announced that it is to appeal on these grounds, possibly paving the way for another lengthy dispute between the two parties.

"I understand that Group Lotus will appeal the decision on the basis that having two Lotus teams will lead to the public being confused," Lowles confirmed, "However, the judge was clear that he felt there was no confusion, and Group Lotus will only succeed if they can establish there was an error in law in the judge's findings and will not be able to questions his findings of fact. From a first read, this would appear difficult.

"Our view is that this was a score draw, in that both parties got part of what they wanted but not all of it. Two Lotus teams will remain on the grid unless Group Lotus successfully appeals and, even if they do appeal, it would be very unlikely to get a decision in the next twelve months.

"It's a classic example of brinksmanship, where neither party backed down but ultimately neither party won."

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



Loading Comments...