A one-on-one America’s Cup

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Court ruling clears the deck for a two-boat, three-race competition between U.S. and Swiss billionaires

Court ruling clears the deck for a two-boat, three-race competition between U.S. and Swiss billionaires

It looks like Alinghi and BMW Oracle will duke it out one-on-one in 90-foot multihulls in the 33rd America’s Cup, now that a New York Supreme Court judge has rejected Alinghi’s motions to reconsider and strike down BMW Oracle’s challenge to a two-boat contest.

“SNG [Société Nautique de Genève] has not demonstrated that the court overlooked any relevant fact, misapprehended the law or otherwise mistakenly arrived at its [earlier] determination,” Judge Herman J. Cahn writes in his March 17 decision.

Cup holder Alinghi, the Swiss syndicate, had asked Cahn to rule BMW Oracle’s July 11, 2007, challenge invalid because in the notification of challenge, the U.S. team refers to the 90-foot multihull it plans to race against Alinghi as a “keel yacht.” The suit also listed other technical grounds.

The 33rd Cup, now a three-race contest between billionaires Larry Ellison (BMW Oracle) and Ernesto Bertarelli (Alinghi), is scheduled for July 4, 6 and 8 this year. Cahn left open the possibility of adjusting those dates for time lost in litigation to prepare for the race.

Bertarelli, after losing this latest round in court, says he’s ready to race.

“While we are disappointed with the outcome of this court order and believe that the matter of GGYC’s [Golden Gate Yacht Club] certificate of challenge wasn’t properly addressed, we have decided not to appeal the decision, and we look forward to getting the fight back on the water and meeting BMW Oracle Racing on the start line of a Deed of Gift Match in July 2009,” says Alinghi attorney Lucien Masmejan, in a statement. However, that’s a year later than the dates BMW Oracle stipulates in its Deed of Gift challenge.

Meanwhile, New Zealand’s America’s Cup syndicate is seeking “tens of millions” in damages from Alinghi, alleging in New York courts that its actions have delayed the next multichallenger Cup — which had been scheduled for 2009 — violated antitrust laws and cost the syndicate dearly, according to Grant Dalton, Emirates Team New Zealand’s managing director.

“It is costing us tens of millions of dollars, and the longer they delay the more the damages will be,” said Dalton March 6 from New York, where attorney David Boies, of Boies, Schiller & Flexner, had just filed two lawsuits on Team New Zealand’s behalf.

One of the suits, entered in New York Supreme Court, claims Alinghi and its management company, America’s Cup Management, breached their contract with Dalton and his syndicate by announcing it wouldn’t hold the Cup in Valencia in 2009, Dalton says. With all the litigation and the prospect now of a two-boat contest this year, Dalton doesn’t expect a Cup with multiple challengers until 2010 or 2011.

Dalton says he holds Bertarelli and Alinghi responsible for the delays because after winning the 32nd Cup last summer they tried to ramrod a one-sided protocol through by accepting a “sham club” from Spain — Club Náutico Español de Vela — to represent all the challengers in the protocol negotiations. Ellison’s BMW Oracle Racing challenged this end run and demanded a consensual protocol negotiated with all the challengers, not just the Spanish club, and filed its own one-on-one challenge under the Deed of Gift in the event a consensual protocol involving other challengers couldn’t be worked out.

“Bertarelli had the chance to accept a reasonable proposal from Oracle, which was also signed by the majority of the challengers and which would have allowed the America’s Cup to be held in 2009. He would not do so,” Dalton says in a statement on the syndicate’s Web site

(www.emiratesteamnz.com).

The Cup has been in litigation in New York courts since last July. In a second suit filed in U.S. District Court in New York, Team New Zealand alleges that Alinghi and its Cup management team violated federal antitrust law by trying to use their powers under the Deed of Gift to “stifle and limit competition.” The suit alleges they did this by accepting the Spanish club as the challenger of record and using it to adopt a one-sided protocol designed to give Alinghi a competitive advantage.