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Team Lotus to stay in F1, for now
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Team Lotus to stay in F1, for now
Posted By: James Allen  |  27 May 2011   |  3:09 pm GMT  |  67 comments

The High Court in London has ruled that Tony Fernandes’ Team Lotus does have the right to use the Team Lotus name in F1.

Group Lotus has indicated that it is likely to appeal and the judge acknowledges that the ruling, which leaves two Lotus entities in F1, is confusing for fans.

Both sides are claiming it as a win, when it leaves neither with all of what they needed.


However Fernandes does not have the right to simply “Lotus” on its own and this could present some difficulties as the chassis is currently a Lotus. One could argue that it’s okay for the team to call it’s chassis Team Lotus, but does that constitute a name change? if it does, they will lose their prize money under the Concorde Agreement, unless they have unanimous support from the teams, which Virgin and HRT would be unlikely to give as the money would come to them.

Even if they didn’t object you can be sure that Renault would, given the bad blood between them.

I spoke to Team Lotus CEO Riad Asmat last night and he has been advised by his lawyers that a chassis name change isn’t needed.

It was a two part case and Fernandes’s side lost the second part as the judge ruled that Group Lotus had been entitled to terminate the licence for use of the Lotus name in F1.

With the Team Lotus decision, that part of it is rather academic, but noteworthy nevertheless.

Group Lotus described the rulings as follows:

Group Lotus has the right to use the name “Lotus” on its own within Formula 1

Group Lotus entitled to race in the historic black and gold livery
1Malaysia Racing Team (1MRT) ruled to be in breach of licence agreement, Group Lotus awarded damages

Team Lotus Ventures Limited trademarks revoked for non-use
Group Lotus trade marks unaffected.

Group Lotus has the right to use the Lotus marque on cars for road use.

The Judge found that:

Group Lotus has goodwill associated with the name “Lotus” in Formula 1 and is free to compete in the sport under that name using the Lotus roundel;

Group Lotus is entitled to race in F1 using the historic black and gold livery;

1MRT is in breach of the Licence granted to them by Group Lotus to race in F1 under the name Lotus Racing and has awarded Group Lotus damages in respect of that breach;

Team Lotus Ventures Limited’s trade mark registrations in the name of Team Lotus are cancelled as a result of non-use;

Group Lotus trade mark registrations are unaffected; and

Group Lotus has the right to use the Lotus marque on cars for road use.

The judgement closes a dispute that has raged since last September. It does however mean that we will have two Lotus entities in F1, Lotus Renault GP (where Group Lotus is a sponsor of Renault chassis) and and Team Lotus is a chassis constructor.

Team Lotus has the right to continue to race in Formula 1 under the name Team Lotus but the effect of the judgment is that only Group Lotus can use the name “Lotus” on its own in F1. Group Lotus is concerned that this aspect of the judgment will cause confusion in the eyes of spectators and the wider public. Accordingly, Group Lotus is seeking leave to appeal.

In anticipation of this decision, Fernandes acquired Caterham recently and now the way is clear for him to call his team Team Lotus Caterham, should he wish to.

Fernandes said, “We are all pleased that it has been clarified that we are the rightful owners of Team Lotus. We have always been confident that the factual evidence we presented would lead to this decision and today’s judgment confirms that belief.

“We are of course disappointed about the decision that Group Lotus was entitled to end the our licence agreement in 2010. We entered into that contract on the basis that we were beginning a long-term partnership with Group Lotus but unfortunately they then used technical breaches of the merchandising pre-notification process to bring the licence and our partnership to an end.

“However, my fellow shareholders and I are firm believers that when one door closes another door opens. In the early days of our agreement we realised its termination was inevitable and as events have unfolded the end of the licence has proved positive for us, with many new avenues being opened up as a result.”

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1

I’ve reads the judgement and it is clear that Group Lotus’ claim that the judge agreed that the use of the word Lotus by two teams is confusing to fans is simply wrong. In fact the judge went out of his way to point out why this wasn’t so, quoting the fact that Renault and Mercedes appears on different cars without any problem.

On the other hand the breaches of the maerchandising agreements by Tony Fernandez are far from minor techical ones.

The agreement they signed required them to get all merchandising pre-approved by Group Lotus.

They obviously had no intention of complying with this part of the agreement and broke it systematically from day one. That clearly gave GL the right to terminate the agreeement.

So neither side emerges clean from this encounter but Team Lotus is going about it’s racing business in exactly the way Colin Chapman would have done.

GL on the other hand haver no involvement in the running of the former Renault-owned team, being only sponsors wishing to exploit the brand to sell their road cars.

I therefore hope they lose any appeal they decide to mount and Team Lotus carry on in F1

2

I don’t think either team should be allowed to use the name Lotus in F1. Neither is the original Lotus F1 team with all the history and experience; they just own variants of the name. In many respects Group Lotus has the greatest right as they own the road car production.

As to names registered under the Concorde Agreement, I cannot see why it should be so hard to change a registered name. Last year, or (was it the year before?) we had the farce of a “BMW-Sauber-Ferrari” after BMW had opted out of F1. We’ve also got Renault still registered this year even though they have pulled out apart from engine supply.

3

100% agree its a totally stupid situation regarding making chassis name changes, and the idea that you will lose money or require the consent of all your rivals is absurd.

OK perhaps mid season changes shouldn’t be allowed and names which continue over a number of seasons should be rewarded to a reasonable extent, but there was no good reason for preventing the BMW Sauber change and if Team Lotus need to change their chassis name they shouldn’t be penalised, and neither should Renault have to run that chassis name when they’re not related to that manufacturer anymore except for engine supply.

4

It really is like a plague of, well, locusts.

It is like a bad divorce, but they were never really married in the first place…

5

Or a plague of ‘Locosts’! A copy of something that was in itself already far removed from it’s origins!!

6

Is it possible to change team names mid-season in order for Team Lotus to become Team Lotus Caterham?

Perhaps Caterham as major sponsor might be more practical for time being? Thus becoming Caterham Team Lotus

7

THat is a team name, no problem, It’s the chassis name that is the problem

8

Neither are a bona fide Lotus team, though at least Group doesn’t parasite off the Champman famiy’s name with the hark back to Colin’s great team.

The Chapman family stated they did not wish “Team Lotus” to be used and I think it’s clear what Fernandez team will do (namely anything) to drive their self-promotion.

Self-promotion on the back of no results mind you!

9

The Chapman Family may have said they didn’t want the TL name to be used. But really, when you look at it from a business point of view, it quite simply shouldn’t matter what they think.

Reason for that is, they sold Lotus Cars and Team Lotus as seperate entities. By selling out, that should mean that they lost the rights to have any say in the future of either company.

TL is a legendary name, definitely up there with Ferrari and McLaren. I’d rather see it where it always belonged, on the F1 circuit. Fernandes and his team have done a great job to bring it back. Bahar and GL have done the complete opposite. All he is really doing is sponsoring another team.

10

The Chapman family have been caught in the crossfire here, although their saying that they did not wish ‘Team Lotus’ to be used seemed to be an astonishing volte face. If they were that concerned about the name, they had the chance to buy back the team in 1994. David Hunt got in there instead, and the rest is history.

As a Lotus fan I’m very much favour of Tony Fernandes reviving Team Lotus, very much in the spirit of the original incarnation of the team, over the grubby behaviour of Mr. Bahar, who has acted in nothing but bad faith.

11
devilsadvocate

I kind of see this as the worst possible way this could have gone. Danny B successfully rooked TF from his contract and almost everything else except for a name that allows him to not lose his prize money. Meanwhile they have not been forced to change anything so we still have two lotus entities on the same grid, albeit one nowhere near the other, but still annoying. I wish it had one all one way or the other, this leaves a bitter taste in my mouth.

12

I keep saying this, and I’ll say it again, CVC, FOM, Bernie, somebody needs to step in and ban both teams from using the name Lotus in anything associated with F1. Its stupid to me, neither team has ANY connection to the original Lotus, noone is related to Colin, or any member of the family. Sure, they have the support of the family, but no connection, just ban the name altogether.

In fact, they should ban the use of Lotus, Tyrrel, Alfa Romeo, Shadow, Ensign, BRM, Auto Union, Cooper, Brabham, and any other name of significance.

13

OK but surely you would need to ban Mercedes and any attempt by any other car manufacturer like Honda to come back into F1??? The current Renault team after all isn’t really Renault and shouldn’t trade as such according to your argument.

Plus people keep implying that Group Lotus is a fake, but it has continuously traded as Lotus since it was founded by Colin Chapman, so its definitely legitimate!

14

Mercedez is owned by the Mercedez Bens road car company, which is financially backing and OWNS the GP team, so I dont see your argument there. If Honda, Toyota, BMW, Ford etc, wanted to be back in F1, they should be allowed as long as they are at least financially supported by the company that makes the road cars. But Group Lotus is not in any way connected to the Lotus GP teams, or Colin Chapman.

In the NBA, teams “retire” jersey numbers of great and reveared players that played for that team, which prevents new players from using those numbers without permision by the player who originally wore that number. Maybe Formula 1 should do the same with team names.

15

Its not unusual for manufacturer teams to be partly owned by other people. I’m certain that last year Mercedes GP had multiple significant shareholders including Ross Brawn who sold their shares to Mercedes prior to the start of this season. The Group Lotus and Renault/Genii deal admittedly is different, however Group Lotus would be crazy to buy a stake in a team until they KNOW they can rebrand the chassis as Lotus, and I would expect them to purchase a sizable stake in the team should they be able to do this.

At the end of the day a team name is just a team name. I don’t know how you could legally prevent a company re-entering F1 on the grounds that they were once successful and the new team isn’t staffed by the same people anymore as they’ve retired, or they don’t operate from the same premises as its a tiny wood shed somewhere. If someone bought Alfa Romeo the idea that they couldn’t enter F1 as they were a successful team in the past is ridiculous.

If we’re talking about historic payments being made for past success then I would agree that as soon as there is a break from being on the grid for more than a couple of seasons then they should return to new team status.

At the end of the day I am pleased to see Lotus back in F1 though I fully understand it is very different from the team that went out of business in 1994. I just wish the silly squabbling wasn’t spoiling it for everyone.

16
Tom in adelaide

Normally i enjoy the contoversies of F1. But really this Lotus squabble is just boring. If only they were battling on track….

17

If Team lotus were toldto immediately stop using the name they would have missed out on heritage moneys andhave started from year 1 again. If he wants to dump the name now he can ask for an exception. I believe if the other teams are unanamous in approval he can change name without losing any money…

Also as James pointed out Team Lotus Catterham sounds pretty good and can draw on lotus history to promote catterham..

18

I really don’t understand what value Fernandes gets from running his team under the “Team Lotus” marque while there are clearly merchandising opportunities in the short term they are effectively racing using a brand name they can’t use outside F1, and that another company is using a very similar brand to sell related products.

They really ought to just call it Team Caterham and call it quits, it might seem daft after all the squabbling over the name Lotus but why promote someone else brand?

19

This trademark stuff confuses me. Are both allowed to use the CABC-roundel, or just Group Lotus, and Team Lotus only allowed to use the name Team Lotus?

20

Sorry to nitpick but where in the Ruling does Justice Peter Smith say it is confusing? Out of the 15 mentions of the word I can not find it. I of course may have missed this reference you appear to have noticed. But paragraphs 199 to 223, Headed CONFUSION/SIMILARITY does not give that impression to me. http://www.bailii.org/ew/cases/EWHC/Ch/2011/1366.html

21

Good for Tony.

I like the idea of Team Lotus in F1, but how much longer will Tony want to provide indirect sponsorship for the suits at Group Lotus. They don’t deserve it.

Tony’s Team Lotus (M1RT) have shown to be capable, plucky, and more than deserving of a place in F1 (whether they be Team Lotus, or Caterham, or even Malaysia 1Racing Team).

Group Lotus, on the other hand, have shown themselves to be well-funded, petty, and not above cutting cheques to big names to get them on their side (a lot of good it did them, was Alesi at the hearing?).

I was a fan of Renault and especially Kubica until Group Lotus tainted the team (funny that the Lotus fiasco affected my perception of the team more than Crashgate).

I wish Renault would get more deserving sponsors. I suppose that’s the problem with a team owned by venture capitalists, they don’t care where the money comes from (I bet they’d even race in Bahrain, no problem).

22

Got to agree with you. The whole ‘Group Lotus/Renault’ tag has just devalued what was a well respected brand in F1 (Renault). Team Lotus has breathed fresh air into the paddock and stand out among the corporate dross that engulfs F1 today. Good for them – hope they grow stronger from hereon. This whole charade has shown what a shabby outfit GL is – no class. Great win in GP2 for AirAsia too!

23

James,

I have a question on whether Group Lotus are ever allowed to actually name a Chassis as Lotus.

From what I understand from the judges report, in F1, “Team Lotus” can continue to race under that name. Group Lotus basically have the right to use the word “Lotus” wherever they like in F1 and the wider world, but the implication of the ruling, which I think is the most interesting part, is that Group Lotus are not able to race under a team name of Lotus. They can remain the sponsors of a Renault chassis, but they are not allowed to ever change the name of that chassis to lotus. Only Team Lotus have the right to have a chassis which includes the word “Lotus”, although it does have to be preceded by the word “Team”.

Am I right in this reading of what the Judge has declared? If so, will this concern Group Lotus, I never quite understood whether their intention was to some day own the once Renault team or to remain the main sponsor. (Obviously I get that they would prefer not to have another team called Lotus).

24

The judge in his decision on the main action seems to me to say that GL can compete in F1 as “Lotus”, from para 287:

“Equally GL has the goodwill associated with Lotus and its Roundel and it is free to compete in F1 under that name using that Roundel. “

25

Good question. I asked Riad the CEO and he says his lawyers say no name change needed

26

But can Group call their chassis ‘Lotus’? If not, then they can only ever be sponsors. Which isn’t good for them.

It would be daft if that was the case, but that’s what some are saying. Confused…

27

They’d have to change the name which means they’d forfeit their prize fund money

28

Good for them.

29

“1MRT is in breach of the Licence granted to them by Group Lotus to race in F1 under the name Lotus Racing and has awarded Group Lotus damages in respect of that breach” – well, at least we now know Group’s claims were correct and it was probably not over a couple of t-shirts as Tony claimed. Cashing in at the expense of other people is a no-no. Probably somebody from the Group felt a takeover was being planned and St. Tony was waiting to catch them with their pants down, no wonder he was trying to devalue the marque publicly, still trying along with a couple of righteous journos (not you, James).

For the time being, there’s too much talk but no results from 1 Malaysia, they’ve got the wrong drivers anyway. I read about a “credible 18th” for JT in Kamarudin Meranun’s Spain race quotes. Aheem, call it “in-credible” 18th and a crash from Heikki who was on top of his game (supposedly) after Tony brought out the best in “Kovaleninen”, as he calls HK on twitter.

It’s also annoying that many armchair experts seem to think Renault (the team) are somehow to blame here; in the end it’s between the Group and Tony – companies are free to use their money any way they like. Group Lotus decided to go with Enstone to plug their product as Vodafone decided to go with McLaren and dump Ferrari. Totally legitimate.

30

Group Lotus has no good will with me.

31

Glad that clears that up then.

32

So “Team Lotus” must be referred to by it’s full name and Group Lotus is the only entity that can use “Lotus” on its own. Yet, the Team Lotus chassis is referred to as just “Lotus.” Isn’t this a case of Team Lotus illegally using “Lotus” on its own?

33
Duncan Snowden

No, it’s an example of a legal mess. I think this is what jonrob meant above when he said that two of the statements in the judgement appear to contradict each other.

To be fair though, this is exactly the current state of affairs. Lotus Racing used the name “Lotus” on its own quite often (on the engine cover, for example) last season, but I don’t recall Team Lotus doing so at all this year, except for the chassis name.

But the whole point of the legal action was to clear all that up. It hasn’t.

34

shame for name “lotus” being in negative contecst in f1…for my side of point everything is about money…

35

Hardly what either party truly wanted and/or hoped for. But then, as neither is the true heir or has a true connection to the original Lotus GP team, they do not deserve even what they got. If they want to burn shed loads of money chasing what they never can truly acquire, that is up to them. It’s just a pity they had to drag the name ‘Lotus’ through the mire.

As a fan of the original, one true Team Lotus, that’s just my opinion.

36
Baron Von Awesome

Sounds like Group Lotus scored some key victories here. I guess Fernandes will argue he won because he can use Team Lotus in F1, but it’s only one element here and it seems like a hollow victory given all the constraints around it. What does he really plan to do with Team Lotus when all he can do is race an F1 team (and even that is going to be appealed)? Looking at the big picture, he lost. He’s fenced in with nowhere to go.

37

I am happy for Team Lotus.

I like the way they go racing and I don’t like the way group Lotus have gone about this.

38

One thing I don’t understand is if TL is allowed to carry on, why Lotus (without Team) has still the right to use Gold & Black livery which is clearly associated with TL.

On the other hand, if Lotus have the right to use Gold-Black livery, do they have the right to use the Green-Yellow one as well ? Maybe this matter needs another trial.

Group Lotus is appealing which shows that they’re not happy with verdict. I guess they want TL name out of business.

We absolutely need Galapago555 insight on these matters.

P.S : as few journalists twitted, the only winners are the lawyers as usual.

39

As to the question of who owns the green and yellow livery, well that’s got to be Team Lotus?

Group Lotus hardly own either livery, given the fact they are and have been for over half a century, a seperate company from the F1 team.

I may be wrong, but how can they possibly own anything connected to Team Lotus, given the fact that they don’t own TL and have not been involved in F1 as anything other than a sponsor?

40

Ok guys, hands up, which ‘decision’ brings F1 into more disriput

a) Bahrain

b) Lotus

c) DRS

41

I would say it’s Baharain.

42

a) 1

b) 0

c) 1

I’m going with DRS.

I guess for many Bahrain is immature at the minimum, but most don’t know about it. For the initiated many would agree.

DRS is anoying to explain and gets alot of questions whenever someone watches F1….

‘so why do they have it’… ‘and so they can use it there’… ‘wait.. only in 1 second how do they know ‘so if they are they can’.. ‘oh, only at a certain point the time is taken’ ‘and it only lasts for that one bit too’ ‘oh, except for when it lasts for more’ ‘and not in the tunnel in monaco’ ‘will they make it unavailable in other places too?’ ‘it sounds like they are making it up as they go along’ ‘they are?’ ‘wow!’ ‘so why isn’t he using it’ ‘isn’t that unfair’ ‘so why don’t they just limit the aero from wings?’ ‘sorry, which one doesn’t have the cahonas to do that’ ‘and they erall think this is better’ ‘ok, understand.. wait didn’t’ ‘so in quali its completely different’ ‘but isn’t that beside the point of it’ ‘they’re trying to blend it into F1 are they now?’ ‘so it is used when it can’t doesn’t need to be and the rules are made up as they go along’ ‘perfected as they go along please’ ‘so how do you know if the lap is .05 faster or just DRS pushing’ ‘you don’t?’ ‘I thought this was F1 not mario kart’ ‘lol’ ‘wait… this is’ ‘thankgoodness they don’t have mushrooms then ahha’ ‘they do, KERS they call it’ ‘and I’m ugessing that only gets charged at certain points in the laps and can’t be used more if they manage to charge it more’ ‘so the technical level of f1 is to develop everything bar the drs and kers’ ‘and they don’t want ot chance the wings’

Interesting.

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