Lotus : The High Court Judge rules in favour…
…of Team Lotus!
Well, it’s a High Court case that’s been running since the end of 2010 and today it looks as though we might have a resolution – Mr. Justice Peter Smith has concluded that Team Lotus can continue running with the name. This is despite Group Lotus’ assertion that its title sponsorship deal of the Renault F1 team should preclude the 1Malaysia Racing Team from using the famous name. Group Lotus, though, has already indicated its intention to apply for leave to appeal against the decision.
The Judgment appears to have been a victory for common sense and has gone down well with F1 fans across the globe, many of whom concluded that Group Lotus CEO Danny Bahar’s efforts to control the name in the top tier of motor racing have been misguided. However, as we have reported elsewhere, Bahar looks like he’s about to start courting a new suitor for Lotus.
Mr. Justice Peter Smith concluded his Judgment by saying: ‘It is unfortunate in my view that this case came before the courts and was incapable of resolution beforehand. 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 nevertheless 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 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.’
Team Lotus said in a statement following today’s hearing: ‘Team Lotus is very pleased with the Judgment in the dispute with Group Lotus and does not intend to appeal any of the key findings. As Group Lotus has already announced its intention to seek leave to appeal the Judge’s decision on the headline argument in this case it is clear they do not feel they have won.
‘The Judge ruled that Team Lotus owns the separate goodwill in the “Team Lotus” name and roundel and we cannot be prevented by Group Lotus from using either of them in relation to Formula 1 racing. This was their headline argument in this case and the primary objective of Group Lotus was to stop us racing under the Team Lotus name…
‘Until 1985 Group Lotus and Team Lotus had their own separate pools of goodwill in respect of the two separate businesses – the road car operation as one entity and the Formula 1 team as another. The claim by Group Lotus to have always owned the goodwill in Team Lotus failed.
‘Having clearly established that there were two separate pools of goodwill the Judgment also establishes that the goodwill in the Team Lotus name and roundel has continued and still survives – it has not been eliminated by non-use. The claim by Group Lotus on that point has failed.
‘It has also been established that there is no confusing similarity between Team Lotus and Lotus. As there is independent goodwill in the mark Team Lotus it is not confusingly similar to Lotus. Group Lotus cannot stop Team Lotus racing under the name we own, so again, Group Lotus has failed in their main cause of action.
‘Although goodwill in the “Team Lotus” name and mark subsists, our trade marks for the Team Lotus name and roundel have been revoked for non use between 2003 and 2008. This however has no impact upon our ability to continue to use the “Team Lotus” trade marks, and indeed to re-register them.’
Group Lotus has also released a statement: ‘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 so that the right to use the Lotus brand in Formula 1 is clarified once and for all in the interests of the sport and the fans. Group Lotus and its shareholder Proton Holding Bhd are confident of success on appeal.’
Sarah Price, Head of Legal at Group Lotus, added: ‘Group Lotus is pleased that its right to race under the Lotus name in F1 has been upheld and that the Defendants’ attempts to stop that have failed. The ongoing dispute with Team Lotus and associated companies has been a cause for concern for all at Group Lotus.
‘Despite the detailed Judgment there are issues which still require clarification and we remain committed to obtaining this much needed clarity for the many fans of the Lotus marque – we are extremely grateful for their continued support. The decision to appeal has not been taken lightly.’
How this pans out in the future will be intriguing. Group Lotus is clearly going to continue fighting, but to what aim? The legal effect of the Judgment is to maintain the status quo: Lotus Renault GP cannot call its cars Lotus, other than as part of its title sponsorship, and the only way of changing that would be for Group Lotus to buy Team Lotus. However, given that Team Lotus has already acquired Caterham Cars, a tie-up with the Lotus sports car business would offer little additional kudos.
It’s a mess, but one which seems to be slowly clearing in favour of Tony Fernandes’ 1Malaysia Racing Team. Danny Bahar and Group Lotus seem, on the other hand, to be facing a rather more complex future…
AROnline readers can read Mr. Justice Peter Smith’s Judgment by following this link to the British and Irish Legal Information Institute’s website.