Alinghi makes a peace offering

"Tell you what Larry. If we promise to make this America’s Cup game a bit fairer, can we not go to court? Please?"

That’s the short version of a peace offering made by Alinghi yesterday. If you want to read the long version from Alinghi, it’s published below.

This is a massive climb down from the Defender’s original position. Clearly the prospect of going to the New York Supreme Court in just less than a month is getting a little too real for comfort.

So thankfully, sense has finally prevailed. Alinghi have backed down in a number of key areas. Though it seems none will ever be brave enough to say it in public, the other ‘legitimate’ challengers have a good deal to thank Larry and the Golden Gate Yacht Club for, in helping to get the 33rd Cup back on track as a true sporting contest.

While questions remain over the CNEV’s legitimacy as a true Challenger of Record (one of the GGYC’s primary objections), I hope Larry and the San Franciscans accept this peace offer from the Swiss, so that business of designing, building and sailing can continue without further interruption.

Here are those protocol amendments in full. They’re well worth a read, because they serve as a reminder of just what overarching powers the Defender had bestowed upon itself.

With regards America’s Cup Management’s (ACM) power to disqualify a competitor, this has been clarified to say that, should a competitor refuse to be bound by the Protocol, then they will have recourse to the Arbitration Panel without risk of disqualification until the Panel rules.

Secondly with regards ACM’s right to refuse an entry. The amendment is a restriction of ACM’s ‘ability to reject’ to an ability only on very specific grounds, which are: failure to comply with the Deed of Gift, a capacity issue within Port America’s Cup or a need to provide an equitable balance of competing nations. The SNG has made it clear that, should the GGYC abandon their legal action, they would be welcomed as a competitor for the 33rd edition and could shape the event along with the other challengers and the Defender during the ongoing Competitor Commission meetings.

A further suggested amendment point, on recommendation from the Arbitration Panel, regards the power of ACM to amend the Protocol and other rules. This has been changed to state that ‘any proposal to make any Protocol changes, related to the way in which the Arbitration Panel works, must be subject to its prior approval.’

In addition to this amendment, the SNG and CNEV have deleted the power of ACM to remove members of the Arbitration Panel. [what??!! This one had passed me by. I can’t believe ACM ever had the power to do this in the first place! It casts a different light on the ruling made by the Arbitration Panel a couple of weeks ago. A case of, ‘well, they would say that, wouldn’t they’, with ACM’s sword of Damocles hanging over their heads.]

Finally, the concern regarding ‘neutral management’ has been amended to extend the Fair Sailing rule to apply to all matters directly related to the regatta.

Following these changes, Ernesto Bertarelli made his plea to the GGYC and Larry’s team: "I would again appeal to BMW Oracle Racing to enter the 33rd America’s Cup as a legitimate challenger. It has been demonstrated that dialogue is possible for the better of this event and it should be noted by them that many areas of their concerns have been addressed.

"We would also like BMW Oracle Racing to consider that their action is hindering the opportunity for other teams to enter the competition, and harming the ability of existing competitors to generate sponsorship income and properly plan their challenge."

So, the ball is back in Larry’s court. It will be interesting to see how he plays it. Here’s hoping he enjoys his victory from Alinghi’s climbdown, and withdraws his legal proceedings accordingly.

Alinghi denies a stitch-up

Some reassurances today from Brad Butterworth and Alinghi that they are not going to abuse their self-bestowed powers over the 33rd America's Cup to the extent that many of us have feared. There are certainly more questions that it would be good to get answers to, but today's statement is at least a step in the right direction. Enough to appease Larry Ellison though? I doubt it. Here is the Alinghi statement in full.

Earlier today, Alinghi, Defender of the 33rd America’s Cup, gave a progress report on preparations for the 33rd America’s Cup at the Société Nautique de Genève. This gathering marked the start of the 33rd America’s Cup campaign and a return to business after the August break. Brad Butterworth, team skipper was accompanied by Hamish Ross, general counsel and Michel Hodara representing America’s Cup Management.

The group announced several developments in the preparations for the 33rd America’s Cup. The first is that the design consultation period, due to start in mid September, will last for six weeks and will result in the definition of the class rule. The consultation will be facilitated by an expert consultant to ensure the views of all five challengers are represented. Secondly, Brad explained that the clear intention regarding the development of the rules is to have a “tight design box” in order to facilitate close racing.

“Our objective is to create a tight design box rule that will ensure the emphasis remains on sailing skill and exciting racing as we have recently seen during the 32nd America’s Cup, this together with large, visually impressive state-of-the- arts boats will help us achieve our vision for the next Cup,” he declared during the press briefing in Geneva. “We are keen to return the America’s Cup to the romantic era of J-Class size yachts, albeit updated with the very latest technology. This will create a superb spectacle and event for sailing fans worldwide.”

It was also announced that in the next few days there will be a Competitor Commission meeting to discuss the 33rd America’s Cup and elements of the Protocol, with the aim to mould this edition into an even greater success than its predecessor.

ACM also confirmed today that Valencia has been approved by the Spanish Council of Ministers and has now been officially ratified by all the Spanish Authorities for the 33rd America’s Cup. This completes all contractual proceedings regarding the venue for the Cup in 2009. ACM also confirmed that United Internet Team Germany has been officially accepted as the 5th challenger.

“Most of the team is now back from the summer break and we are pressing ahead with preparations for the next Cup in 2009, with a particular focus on developing the new class rule through consultation with the five confirmed challengers,” said Brad Butterworth, adding: “These new class rules will be released on 31st October 2007, 18 months before the first pre-regatta with the new boats, and two months earlier than initially planned.”

Brad took the opportunity to clarify and further explain aspects of the Protocol that have been misinterpreted over the summer period:

CLARIFICATION OF ELEMENTS OF THE 33rd PROTOCOL

It has been alleged that CNEV is a ‘sham’ and not a legitimate Challenger of Record?
A: The legitimacy of the CNEV is unquestionable. For the 32nd America’s Cup, Desafío Español represented the Spanish sailing community through the Federation and it was decided to create a new club that captured the essence of Spanish sailing. This new Club incorporates the America’s Cup spirit in Spain and is chaired by the Vice Chairman of the Spanish Sailing Federation. BMW Oracle Racing are attempting to undermine the challenge on two counts both of which are erroneous as there are several examples of clubs being formed specifically to challenge for the America’s Cup (including clubs from Australia, Japan, Germany, US and Canada) and of clubs holding regattas after submitting a challenge. Furthermore, the credibility of the Spanish Challenge is further underlined by the strong performance demonstrated during the 32nd America’s Cup with them advancing to the Semi Final.

What is the impact of the BMW Oracle Racing legal challenge?
This is a legal ambush by one party; the fact is we have six competitors, including Alinghi, lined up for the 33rd America’s Cup. It is a distraction for the America’s Cup and is totally self serving on their behalf. It is most damaging for teams that haven’t yet entered given that this climate of uncertainty created by the GGYC prevents them from gaining sponsorship and building their teams. The 32nd America’s Cup saw the best action on the water and that is what we want for the 33rd America’s Cup.

What is the reason that ACM can refuse an entry?
See AC 33 Protocol clauses 2.7 (d), 4.4
A: First of all a competitor has to fulfil the requirements of the Deed of Gift and the Protocol. Furthermore, ACM is the event organiser and this rule has been written because, as in other major sporting events, we have a limited number of entries available, however, if a potential entrant feels they have been unfairly treated there is recourse through the Arbitration Panel.

ACM can throw out any competitor at any time?
See Protocol clause 5.4 (b)(d)
A: No, ACM does not have the power to throw out a competitor at any time. ACM has the power to disqualify a competitor who refuses to be bound by the rules. Even in this extreme situation the competitor concerned would be entitled to appeal to the Arbitration Panel.
This is very similar to the obligations of any other global sporting event authority, including the IOC, FIFA and the FIA.

The officials are not independent?
See Protocol clause 5.4
A: The Protocol contains rules to ensure fair sailing and from a sporting perspective the 33rd America’s Cup will be no different to the 32nd. The key is what happens on the water and during the sailing competition will be in the hands of experienced officials, with a record of integrity, accredited by the International Sailing Federation (ISAF). The Challenger of Record can object to any senior (those with decision making powers) appointment if they believe the person is not neutral and the Sailing Jury will determine whether the appointment is neutral or not.

Why does ACM need the right to change the competition regulations from ‘time to time’?
See Protocol clause17
A: ACM administered the 32nd America’s Cup, arguably the best America’s Cup of all time and it needs the appropriate authority to run the 33rd edition. This is no different to any other global high tech sport where the governing body has to provide regular interpretations and clarification of sporting and technical rules in a dynamic environment.
The Challenger of Record or the Defender can object to significant changes and ACM could refer the proposed change to the Arbitration Panel.

The new Competitor Commission has no voting powers?
See Protocol clause 10.1
A: The Defender and ACM need to be in consultation with the challengers to ensure the next event is as good as possible and therefore it made sense to be present within this forum.
It should be noted that the Challenger Commission had no voting rights last time affecting the competition, only the power to recommend. The same applies to the Competitor Commission this time.

The late publication of the new class rules will not give the teams enough time and will provide Alinghi with an unfair advantage?
A: We have been thinking about changing the class since 2003, as a matter of fact Russell Coutts was a strong advocate for a new class of boat for the 32nd America’s Cup. The design team is now back and working after the summer break in preparation for the six week consultation period which starts in mid September. This consultation will lead to the definition of the new class rule which will then be released on 31 October 2007, 18 months before the first pre-regatta in the new boats, and two months earlier than initially planned. In order to facilitate the work during the consultation period and to ensure the views of all competitors are represented an appropriate expert consultant will be appointed to oversee the process.

How will the new class rules lead to ‘close and exciting’ racing?
A: It provides for all competitors to start at the same level. It is our intention to limit the parameters of the ‘design box’ for the new class as this will assist in achieving our vision of state of the art boats and competitive racing befitting of the premier event in international sailing.

Alinghi will gain unfair advantage through competing in the Challenger Selection Series (CSS)?
Our philosophy to reduce cost and encourage competition is to return to the concept of a one boat campaign per team for the 33rd AC. This is the best solution to actively reduce the costs by avoiding having to hire two full crews and produce and maintain two fully rigged boats. However at the same time the Defender needs to be able to gauge and develop its relative performance and therefore needs to be included in the series. The other choice was for the Defender to two boat test from the start of the campaign, which is expensive and less attractive from an entertainment point of view.

"Stop dragging your feet!" NY Court tells SNG

The Golden Gate Yacht Club have moved a step closer towards getting the America's Cup dispute with Alinghi heard in court. Here is the GGYC statement in full.

The Supreme Court of the State of New York today granted an order sought by the Golden Gate Yacht Club (GGYC) requiring the Société Nautique de Genève (SNG) to promptly answer a request to speed up the legal process for resolving its proposed new rules for defending the next America’s Cup.

The San Francisco club sought the Court ruling alleging SNG is in serious breach of its fiduciary duty under the Deed of Gift that governs the Cup. It says SNG has accepted an invalid challenge from a sham yacht club, and is seeking to impose an unprecedented one-sided set of rules that hugely favor the defender to the detriment of all other competitors.

“We are very pleased with this ruling by the Court, because we believe the Cup will be irrevocably damaged if we don’t get SNG’s Protocol changed,” Tom Ehman, Head of External Affairs for BMW ORACLE Racing, the US club’s team, said.

“The new Protocol would give SNG’s team, Alinghi, radical new powers to control nearly all aspects of the event that are still unsupported by any explanation from SNG as to why they are needed,” he said.

Ehman said the syndicate whose challenge had been accepted by SNG, the Club Náutico Español de Vela (CNEV), was a shell organisation that had been formed only days prior to issuing a challenge and did not comply with the terms specified by the Deed of Gift.

“We would still prefer to negotiate a solution outside the court, but we see SNG as violating its responsibilities as Trustee, and we are fully prepared to go the legal distance if needed to stop the America’s Cup being subverted into a hopelessly one-sided event,” he said.

The Deed of Gift that protects the Cup as a perpetual sporting challenge is governed by a fiduciary trust established under New York law in 1887.

The GGYC court action also seeks a preliminary injunction to obtain critical information related to the club’s challenge under the Deed of Gift.

The American challenge is for a race next summer under the Deed’s 10-month rule. GGYC need to know where SNG intends to hold that competition and what the SNG sailing rules are. Under the Deed, the Swiss Defender is required to provide these important details to the Challenger.

GGYC filed a challenge on July 11th, and asserts that SNG must accept it. If successful in this motion, the GGYC case could be heard by the Courts as early as October 2007.

A bugger’s muddle

Anything happen while I was away? Apologies for the lack of correspondence lately but I’ve been taking some post-Valencia holiday. I’ll really have to schedule my time better for the next Cup. After all, as we’ve discovered this time, when the side-show of the sailing has concluded you have at least another month of legalistic shenanigans and wheeling and dealing to get through.

This time, unfortunately, we’re looking at good deal longer than a month to unravel the mess created by the Protocol for the 33rd Cup. For a legal journalist this is probably about as exciting as it gets. For a sailing simpleton like me, this is all insufferably tedious. But it’s the America’s Cup, and it goes with the territory.

Ernesto Bertarelli and his gang came out shooting last week, taking pot shots at Larry Ellison’s plans to take the Defenders to the New York Supreme Court. As far as the Swiss billionaire is concerned, the matter should be dealt with in-house. “We have submitted this dispute, which is damaging to the entire sport, damaging to the America’s Cup, to our independent arbitration panel and we hope to have their resolution soon.”

Note the interesting choice of words there. “Our independent arbitration panel”. Oxymoron? Surely he meant to say “the independent arbitration panel”? There’s a big difference between the possessive “our” and the neutrality of “the”. Which perhaps says a lot about Alinghi’s sense of ownership of the Cup.

You can see why Larry has a problem with the Protocol, not least the Defender’s ability to appoint its own race officials. “No sports run officials like that,” said Larry. “Can you imagine Chelsea hiring the officials for the Manchester United game, but then also wanting the ability to change the rules at any time? It is the most bizarre Protocol we have ever seen.”

However, we have seen few – actually have we seen any? – public displays of support for Larry and the Golden Gate Yacht Club’s stance. The Americans claim they’ve had support from eight different challengers – and I could just about believe it. But public displays of support? None that I’m aware of. The Kiwis have been the latest to line up behind Alinghi, after Shosholoza and Team Origin. Apparently the Kiwis have been offered a sweetener of getting involved in helping Alinghi formulate the new design rule, giving them a vital few extra months of understanding of the new 90-footer rule before anyone else gets to see it. Richard Gladwell from Sail-World NZ has bagged a good interview with Dean Barker, which you’ll find here.

What of Alinghi’s announcement last week that each team will be permitted to build two race boats before the next Cup, but that teams will only be allowed to sail one at a time? Ernesto cited this as a cost saving exercise, which indeed it is, knocking a huge chunk off the wage bill if you can’t have two full sailing teams out race testing and training every day for two years.

Then again, it begs the question why Ernesto got in such a huff over Grant Dalton’s proposed nationality rule for the Cup had the Kiwis won it. Ernesto said way back in June: “If he was to win, that basically would put three-quarters of the people around this harbour out of work.” However, the new rules for the 33rd mean there is no need to have 34 sailors ready to man two boats. Now you’ll need just 20 or 21 to fill one of the new 90-foot beasts. So not everyone who was competing in 2007 is going to find room on board a boat in 2009.

Nevertheless, I like the one-sailing-team rule. The wage bill will be more affordable for the smaller teams. On the other hand - two boats to be built in less than 18 months? That’s definitely one for the big teams to enjoy.

Fellow blogger (and former America’s Cup navigator and electronics wizard) Mark Chisnell has an interesting analysis of this ‘two-boats-one-crew’ situation. He foresees a big step-up in instrumentation and telemetry programs to compensate for the lack of two-boat testing. In which case people like, well, er Mark Chisnell, will be in hot demand. Chizzy was too modest to put his own impressive CV forward on his blog, but no doubt his phone has already been ringing off the hook since Alinghi made their announcement last week.

Crikey! More than 500 words in, and I’ve neglected to mention a few other key facts, eg,

Venue: Valencia

Date: July 2009

Hooray to that. Great city, lovely people, and a two-year timescale. Full marks to Alinghi for time and location, and well done to the Spanish for securing the deal with a bargain basement price of just a sneeze over 100m Euro. Cheap at twice the price.

Oh yes, and the shock (not!) appointment of Russell Coutts to BMW Oracle Racing as, you guessed it, CEO of the whole shooting match. Now, Russell Coutts is not Chris Dickson, but you might have thought that for Larry it would be a case of once bitten, twice shy. Still, if you’re going to put that much power in one man’s hands, it might as well be Coutts. With Butterworth staying put as Alinghi skipper, this sets up an intriguing rivalry between these two great mates.

No one knows Coutts’s strengths better than his former tactician, so it will be interesting to see who gets the helmsman’s job this time at Alinghi. Who is best equipped to counter Coutts’s moves on the race course? My guess is that it will be an Australian. Either an old one – Peter Gilmour – whose latest victory in the Portugal leg of the World Match Race Tour suggests he’s still as good as any of the young guns. Or a young one – James Spithill – who negotiated with Alinghi last time but couldn’t reach an agreement over bringing his core of Aussie mates with him.

The day after winning the 32nd, when I asked Butterworth who else he rated from the last Cup, another name he singled out was Jes Gram Hansen from Mascalzone Latino. Perhaps the underrated Dane will get a call from Brad.

Wow, I’ve veered back on to sailing again! Hopefully that’s what the America’s Cup world will start talking about again soon. But I doubt it. There’s so much billionaire ego at stake now, it’s hard to see this going anywhere but the New York Supreme Court.

What a long-distant memory that one-second delta of the 32nd America’s Cup seems now. After Barker and Baird, now it’s the lawyers’ turn to enter the start box. It could be over quickly with an early penalty, but I fear a long and protracted dial-up.

It's a bugger's muddle. A field day for the lawyers, a disaster for the short-term health of the event. Longer term, this will become yet an other colourful chapter in the chequered history of the America’s Cup, but I can’t wait for it to be over so we can get back to the sailing.

That’s not a Challenge. This is a Challenge. In 90-ft Multihulls!

The Golden Gate Yacht Club has counter challenged the Spanish Challenge of Record, claiming the Club Nautico Espanol de Vela’s challenge to Alinghi is illegal.

I don’t know if the Spanish challenge is illegal or not – I’ll leave that argument to the laywers - but it was certainly spineless. By accepting the one-sided Protocol laid down by Alinghi last week, Desafio Espanol has effectively admitted that it has no real desire to win the 33rd America’s Cup. It is merely happy to be a participant, whilst handing Alinghi the tools for a 5-0 whitewash.

The Spanish team is to be applauded for having reached the Semi Finals of the recent Louis Vuitton Cup, but it appears that is the limit of its competitive instincts. In its desire to keep the Cup in Valencia it seems Desafio Espanol was prepared to sign almost anything that Alinghi demanded. The Spanish have sold the challengers down the river.

Today, BMW Oracle’s home club in San Francisco, the Golden Gate Yacht Club, sent its counter-challenge to the Societe Nautique de Geneve. The GGYC commodore Marcus Young wrote: “We respectfully submit that the challenge is invalid. Among other deficiencies, it is not from a bone fide yacht club, but from an entity organized in the form of a yacht club only a few days before the challenge was accepted by SNG and which has never had an annual regatta on an open water course on the sea or an arm of the sea as required by the Deed of Gift.

“It is also apparent that this ‘Challenger of Record’ has not performed any of the duties of the Challenger as contemplated by the Deed of Gift, but has simply delegated to the Defender the authority to determine all of the ‘conditions’ governing the match. This undermines the fundamental purpose of the Deed of Gift to preserve this competition as a Challenge Cup.”

And here’s the fun part.

The dates: “We name 4 July 2008 as the date of the first race, 6 July 2008 and 8 July 2008 as the dates for the second and, if necessary, third races.”

And here are the vital statistics for the boat:

Rig: single-masted, sloop-rigged

Dimensions:

Length on Load Waterline – 90 feet

Beam at Load Waterline – 90 feet

Extreme Beam – 90 feet

Draught of water (hull draft) – 3 feet

Draught of water (boards down) – 20 feet

So, a 90-foot catamaran perhaps, or a 90-foot trimaran, or what about a 90-foot skiff with trapeze wings spanning 90-feet from side to side? To be held somewhere in the northern hemisphere in just less than a year.

Plainly the proposal is ludicrous, but in so doing the GGYC has highlighted just how ludicrous some elements of the original Protocol document are. Take, for example, the fact that the Defender has granted itself the right to compete in every stage of the Challenger series, with the exception of the finals. Oh right, OK, so with the one-boat rule that is being mooted, that would mean the challengers’ boats are committed to three months of hard racing, with no opportunity for testing or development. Meanwhile the Defender is free to compete for a few races, assess relative speed against the challengers, then withdraw for a spot of chainsaw surgery and then enter a later stage of the Challenger series a couple of weeks further down the line. Rinse and repeat until boat is faster. How very convenient.

The Club Nautico Espanol de Vela was quick to issue a rebuttal to the GGYC’s shot across their bow, protesting the validity of the original challenge, and assuring everyone that the Protocol guarantees a fair fight for one and all. With thanks to James Boyd’s translation of the original Spanish text on The Daily Sail: “We want to emphasise that the spirit which has presided over the negotiations with the Defender on the part of the CNEV has been one to create a transparent competition that is right and equitable for all the participants and for which joint instruments of management have been created which we hope contribute to a greater agility and effectiveness in the development of the next event.”

Phew, that’s a relief. Back to your beds and rest easy. The Spanish have got it under control. “Thanks for your concern, GGYC, but we’ll take it from here.”

90 Footers for the 33rd Cup

So, the rumour was true! New boats after all: 90 feet long, lifting keels to get in and out of harbour, 20-ish crew, designed to a box rule and possibly limited to one boat per team.

Plenty more was said, but few facts came out of today’s announcement. It will be in Europe, possibly but not necessarily in Valencia, 2009 if Valencia, 2010 or 2011 if elsewhere in Europe. And Alinghi can choose to take part in the Challenger Series all the way up to – and including – the Semi Finals! Cheeky, but it seems Club Nautico Espanol de Vela were prepared to sign almost anything to secure the privilege of becoming the new Challenger of Record.

At the Challenger of Record press conference at the Desafio Espanol base, one journalist asked the Challenger’s representative lawyer if he had signed a blank piece of paper. His response: “I’m a prestigious lawyer. I’m nobody’s puppet!” Methinks he doth protest too much!

Anyway, more of the Protocol another time. On to the boats, although even here the details are sketchy. Brad Butterworth gave his reasons for a new class in the Cup. “Everybody seems to want a new boat that is bigger, more exciting, difficult to sail, and faster, which is the emphasis behind it. So now we have to come up with a rule for it, and that will need a bit of hard work.

“I think that the timing of the event has got to meet those requirements, so the rule can come out with enough time and everybody can start designing and getting their tools, and designing and building the boat. It will probably take about 20,000 man hours to build a ninety-footer - it all takes it’s time. That is why the window of when the event is has to be a bit flexible, from the sailing point of view.”

Brad said he had enjoyed the ACC boats, but that it was time to move on to “something more exciting. These boats have been fantastic but I think they have got to the end of their life and people are looking for something that is a little bit bigger, a bit more difficult and more exciting. The guys and designers feel they have had their run with these boats and the class rule and they are looking for something else to stimulate them and part of that is to go with a new boat.”

However, he ruled out the possibility of a canting keel, opting instead for a lifting keel. “The canting keel is a difficult option. We can do it a little bit better with this sliding concept; it is not better, just different. In the end the boats will be bigger, faster, and harder to sail – 90 footers that won’t have hydraulic, electric run winches. The guys will have to be athletic [he said with a grin that betrayed just a hint of self-mockery]. They will be tough boats to sail. We haven’t written the class rule yet; it will be put together and published over the next couple of months.”

The perception is that a new class plays into the hands of the richer teams. Just as Brad is fond of saying: “The America’s Cup is a design race.” On this occasion, no one will disagree with him, although he sees it as levelling the playfield. “I think any of the good teams will take it on. They all have good designers and people. I don’t think the rich will get richer; it will be tough for some to catch up if we limit it to this class.

“I think the rule will be reasonably tight, like a box rule, but obviously this rule is pretty complicated. It would be nice to open it up a little bit more. It will be encouraged to come up with new innovative ideas. This is a design contest - a technology race. I think that’s the way the Cup has always been, and we are going to keep it that way.”