Group Lotus to Tony Fernades: Cease and Desist

[prisonermonkeys]

That may have been it. I've heard that the split had something to do with marketing or merchandising. LR8 might have been it. But Lotus Cars will most likely argue that because the licencing agreement was breached and terminated, they no longer want to have anything to do with Tony Fernandes and his team. Therefore, by calling themselves Team Lotus, they are still associated with Lotus Cars, even if they have the legal rights to the Team Lotus name.

 

[Ardius]

That may have been it. I've heard that the split had something to do with marketing or merchandising. LR8 might have been it. But Lotus Cars will most likely argue that because the licencing agreement was breached and terminated, they no longer want to have anything to do with Tony Fernandes and his team. Therefore, by calling themselves Team Lotus, they are still associated with Lotus Cars, even if they have the legal rights to the Team Lotus name.

No they are not, just as Team Lotus was not associated with Lotus Cars in the past. Lotus Cars like to pretend the two companies were directly associated in all of their press releases and marketing, but its actually complete rubbish. The two companies did work together on several occasions, but in legal terms, they were always seperate companies with no association apart from a connection to a shared founder. Lotus Cars like to pretend Team Lotus' F1 history is theirs.

 

[Hun200kmh]

Yep, the closest you'll find to a road car with genuine Team Lotus heritage is a ... Caterham

 

[prisonermonkeys]

No they are not, just as Team Lotus was not associated with Lotus Cars in the past.

I mean they are associated in letter, if not spirit. They are two separate and totally different organisations, but they have the same name. Lotus Cars will claim that because they are known as Lotus and Fernandes' team is known as Lotus, there is nothing to identify one another as being separate and Lotus Cars do not want any association with Team Lotus.

 

[maximumattack]

It's just a real big mess, I hope it can be sorted before the start of the season.

 

[Ardius]

I mean they are associated in letter, if not spirit. They are two separate and totally different organisations, but they have the same name. Lotus Cars will claim that because they are known as Lotus and Fernandes' team is known as Lotus, there is nothing to identify one another as being separate and Lotus Cars do not want any association with Team Lotus.

A name is not an association in legal terms, its as much an association as the flower is. Are we to re-name the flower too?
I don't think having a similar name is an issue that was caused by one side or the other, its been caused by both of them.

If anyone is going to win the case (if anything is to be won), its going to be on the grounds of who owns what and when and for how long. Its not as if Fernandes-Lotus have come in only this year, they are in fact a team Group Lotus helped start up. Thats the complication here.

But I don't think either side are bothered about there being two of the same name. What they are bothered about is their own wants (Fernandes wants to run as Lotus, Bahar wants to have the chassis name rather than just be a sponsor).

 

[Stevisiov]

I think I have found Brundle's comments for those who are interested.

link

 

[maximumattack]

Thanks for that Stevisiov 👍

 

[yeti]

I don't see how thats clear at all? How is having a former employee of Proton and a license agreement proof of attempting take over? This is so rediculously vague.
"Clear", "conspired", "conspiracy" are not the words that come into my mind.

I like how James Allen can just write an unsourced, unexplained paragraph into an article and people lap it up. He might think there is/was some "conspiracy", but there is no proof as such.

I'm with Ardius here - this isn't a "conspiracy" - it's a plan - fair enough quite an ambitious one - and why not...

It's like some day I plan to own a company - whether I buy one, start one or get given control of one is yet to be decided... Along the way I may find things that help my plan reach fruition - if one of those is an employee of a company that I want to buy - then so be it...

There is no conspiracy here.

C.

 

[astrosdude91]

So, The Lotus-Renault may run into trouble with their new livery in Canada, since their livery resembles tobacco product packaging.

The Lotus Renault GP team could face problems over its new livery ahead of the 2011 Formula 1 season. Renault put its 2011 livery on display at the Autosport International Show last week, with the widely anticipated black-and-gold colours revealed to the public. Following a long-term investment from Group Lotus, the outfit is currently going through a phase of significant changes.

The car was a massive hit with F1 fans, but despite the nostalgic values of Renault’s JPS-inspired livery, Canadian tobacco laws could present an issue for the outfit when the F1 paddock arrives at the venue in June. Currently, the Circuit Gilles Villeneuve will not allow a team to compete if its cars were to resemble a cigarette packet.

The 2004 Canadian Grand Prix was close to cancellation when a new tobacco law was enforced during the previous year, with race-officials having to pay 29 million Canadian dollars (18.35 million British pounds) to compensate cigarette sponsors when their logo’s were removed from every competing car.

A spokesperson for Health Canada commented: "Tobacco inspectors would need to fully review to assess whether a violation of the Tobacco Act has occurred. The Tobacco Act prohibits the promotion of tobacco products or tobacco product-related brand elements in Canada, except as authorized by the Act or regulations. Tobacco product sponsorship is prohibited entirely and tobacco advertising is severely restricted.


"A representation about a product or service by any means, whether directly or indirectly, including any communication of information about a product or service and its price and distribution, that is likely to influence and shape attitudes, beliefs and behaviours about the product or service."

Imperial Tobacco Canada distributes a wide variety of brands across Canada including John Player Special, and was curious to know if the Renault team knew about the legislation.

"It is categorically against the law to present any likeness to a cigarette pack," a member of the company said. "If I were Lotus though, I would be concerned. I wonder if they are aware of the law in Canada."

Lotus Renault GP has currently not responded to GPUpdate.net in relation to the matter.

 

[Northstar]

Perhaps that is why they made the gold so wide compared to the original JPS livery?

Just a theory.

 

[prisonermonkeys]

Probably has more to do with television coverage. They had the stripes widened to make them more visible.

However, there is a way around the Canadian laws. The rules set forth by Bernie Ecclestone that prohibit changes to liveries are designed to prevent major changes. You can't start the season with a yellow car and finish with a red. Back when Renault had sponsorship from Mild Seven, they used to replace it with "Team Spirit" and they'd run an artistic livery. Hispania did it last year; they started with a grey car that had red, yellow and white stripes, and they eventually removed the white. All Renault would have to do is lose the gold stripes and change the colour of all their liveries to green or blue or white, and they'd be fine.

 

[prisonermonkeys]

Lotus vs. Lotus goes to court today, but don't expect any resolution soon. According to that article, this is Group Lotus requesting a summary hearing, with a judge deciding whether there is a cause for a full trial nor not. It's expected that there will be a full trial, and even if the judge decides on a summary hearing, Fernandes' and his crew will likely appeal the decision. From reading some of Fernandes' Tweets, he's really quite defensive about it and it looks like he's trying to drag it out for as long as possible.

 

[yeti]

Technically Off topic - but similar...

I'd not heard about this case before...

http://www.pitpass.com/fes_php/pitpass_news_item.php?fes_art_id=43048

Is this just posturing from Force India? Or is there real danger of Tony Fernandes and Mike Gascoyne being in trouble?

C.

 

[Ardius]

Old news, way old news. From way back in 2009? This all started when Team Lotus revealed some early shots of their windtunnel model at Aerolab and it was the old Force India windtunnel model design. Apparently Force India had terminated their contract with Aerolab prematurely (probably around the time they sacked Gascoyne as he has ties with Aerolab), so Aerolab had obviously some left-over designs and models from that.
Force India claim its their intellectual property, whereas Aerolab claim its their design work, so its theres. Many expect Force India to lose the case basically because its thought they were the ones who terminated their contracts and hence probably lose their rights to the designs.

It got forgotten over the season as nobody cared.

The fact the courts are leaving it till next year says it all really, its quite a meaningless case. In contrast, the courts decided on an early decision for the "Team Lotus" case as its important for the purpose of merchandise and marketing.

 

[yeti]

Cheers for the update... I definitely missed this one first time round.

It does amaze me why companies burn so much cash in the courts sometimes (LG/Sony?! etc) - when a lot of the time it's politically based.

C.

 

[Only_in_f1]

This is back on Monday (21st).

So what are the possible outcomes and effects?

 

[prisonermonkeys]

Well, the heart of the matter is the termination of the contract.

If the court rules that Group Lotus legally terminated their contract with Fernandes, then it is likely that Fernandes will have to change his name. Although he does own the rights to the Team Lotus name, Group Lotus are arguing that when he violated their licencing agreement, they no longer wished to be associated with him. They signed up with Renault instead. And although Team Lotus and Lotus Cars are separate entites, Group Lotus claims that having two teams competing under the Lotus name damages their name since they no longer want to be associated with Fernandes; fans and observers could easily get confused.

Tony Fernandes, on the other hand, is arguing that Group Lotus wrongfully violated the contract. If the courts rule in favour of him, then it is likely that Group Lotus will have to pay them for the wrongful termination. However, because Fernandes is competing under a Lotus name that is not under licence from Group Lotus, the courts cannot force Group Lotus to change the name of Lotus Renault Grand Prix because of the separation since Fernandes isn't asking LRGP to stop using the Lotus name. And Group Lotus are only a sponsor or LRGP; they are not an owner.

 

[prisonermonkeys]

The hearing over the termination of the contract begins today. And it's already going badly for Tony Fernandes: he's lost the support of David Hunt. Hunt claims that Fernandes has gone back on the terms of the deal that allowed him to use the Team Lotus name, and is attempting to renegotiate terms that Hunt claims are ridiculous. He has openly said that unless Fernandes honours the original contract, Hunt will not support him in today's case. He also says that there are some (potentially) serious flaws in Fernandes' case against Group Lotus.

Of the two cases regarding Team Lotus, Hunt's involvement with Fernandes is more important in the case set for later this year, which will decide whether or not Fernandes owns the Team Lotus name. But a loss of support here could do critical damage to Fernandes, to the point where the case set for September (or is it November?) will be entirely elementary. Today's hearing revolves around whether or not Group Lotus wrongfully terminated the licencing agreement with Fernandes at the end of last year. Group Lotus claims that they had the right to do so because Fernandes misused their image. So for Hunt to come out and say that Fernandes is not honouring his obligations the day before Fernandes goes to court over a case revolving around the termination of a contract is a pretty big deal. It could even be a deathblow. Hunt hasn't said he'll support Group Lotus, but Fernandes' actions set a pretty poor precedent. And without the supoprt of Hunt or the Chapmans, Fernandes is really in a bad spot.

Even if the courts rule in favour of Fernandes, Hunt's claims could still derail him later in the year when the issue of the ownership of the Team Lotus name comes up. But if the courts rule in favour of Group Lotus, and Fernandes is forced to stop using the Team Lotus name because it's too similar to Lotus Cars, then it doesn't matter if Fernandes wins the case later this year. Even if he does own the Team Lotus name, he still won't be able to use it.

The only problem I can see in all of this is that Fernandes will unjustly get the support of the fans, even if he loses. If Group Lotus prove that Fernandes violated their licencing contract and Fernandes is forced to use a different name, people will still support him because of the perception that Dany Bahar is evil and out to steal the Lotus name (despite the fact that he owns the Lotus Cars name). A lot of Bahar's actions - especially the support of teams in various other open-wheel formulae - demonstrate that a Formula 1 programme has been on the cars for some time; this isn't something that he cooked up overnight when he saw the success of Lotus Racing. After all, Bahar was directly involved with Lotus Racing since he gave them permission to use the Lotus Cars name. I don't doubt that Lotus Cars would have continued to support Tony Fernandes if it weren't for the licencing dispute.

 

[Ardius]

Bahar wasn't around when the "Lotus Racing" deal was done. If you don't think Bahar/Group Lotus wanted a greater control of the team then you are blind. Its always about money and control with these things.
Also ludes, people don't think "Bahar wants to steal the Lotus name". Where did you cook that one up?
People do think Bahar is pushing Group Lotus down a risky path. I wouldn't just blame him for trying to pretend to be Team Lotus as they have done that for many years in their promotional material before Bahar was on the scene.

How is sponsoring junior formula showing planning? Spending money on things isn't telling you anything exept they are spending money, whether its clever or not remains to be seen, I don't really see the benefit of it. It would make more sense to spend more of that money developing their GT programme becuase it is something they can sell and develop a reputation in many series for many years. GP2 and GP3 exposure is very limited and its not as if Renault are stuck for young drivers....

Anyway, it seems Mr Hunt has recieved a better offer .

 

[prisonermonkeys]

How is sponsoring junior formula showing planning?

Because Dany Bahar didn't just wake up one morning and say to himself "You know what? I reckon it would be a good idea if we started sponsoring teams in all forms of motorsport!" and then went down to the bank. It's not something that he simply cooked up on the spot. He would have had to go through budgeting and marketing and executive sub-committees. Hell, because Lotus are supported by the Malaysian government (through Proton), he probably had to go the the Malaysian parliament and talk it over with them if the money was going to come from taxpayers.

 

[Ardius]

How do you know he didn't? Simply sponsoring junior formula is proof of nothing except having a lot of money to spend. I don't see how its particularly clever. I don't see why you bring it up as an example that he isn't a fool. It can easily be an example of why he is a fool.

 

[prisonermonkeys]

How do you know he didn't?

Uh, because when you're in control of a company worth millions of dollars the way Bahar is, you don't get to spend money on a whim. Especially when it's someone else's money. Bahar would be obligated to get approval from various people within the company before those teams even entered into negotiations with Group Lotus for the first time.

 

[Ardius]

I meant how do you know he didn't just decide it on the spot and that its some maginificent plan covering all bases? Point - you don't, you're just assuming because he is doing things that he knows what he is doing. Pretty obvious he can't do anything without approval (though I think its more likely he was hired simply to spend some money for them...do you really believe he had to go convince them to spend this money?). Considering Bahar was the guy behind the rediculous Ferrari and Red Bull marketing, clearly Group Lotus hired him to spend their marketing money.
Its irrelevant anyway, spending money doesn't make you credible. The results are what do that.

 

[Only_in_f1]

I can't believe this didn't start today. Waste of a journey.

 

[prisonermonkeys]

I can't believe this didn't start today. Waste of a journey.

Technically, it did start. The 21st was designated a reading day, to allow the judge to catch up on all the necessary knowledge he (or she) would need to be able to understand the issues at hand and come to an appropriate verdict.

 

[Only_in_f1]

Today was the same as yesterday, all the tedious stuff!

 

[prisonermonkeys]

Ted Kravitz on Twitter:

“Fascinating day in court, strong arguments on both sides. Neither Tony Fernandes nor David Hunt appeared as witnesses. Verdict within four weeks.”

Looks like the main phase of the hearing is over. Exepct a verdict before Istanbul.

 

[Matti_Dude]

So once the final verdict has been decided will we have two less Lotus's on the grid?

 

[SaberFire]

Unless the verdict is something like the Team Lotus name being a completely different trademark and entity to the Group Lotus name, therefore meaning that if Tony Fernandes indeed owns the name legit, he can continue to call his team Team Lotus.