The long long legal road

Alinghi lawyer Lucien Masmejan gives us a state of the nation over the 33rd America's Cup

As the stakes have been raised between the factions warring over the 33rd America's Cup, so at Alinghi (or officially, the Societe Nautique de Geneve) the legal face of the Swiss defender has gone from being their long term General Council Hamish Ross to Ernesto Bertarelli's sharper teethed personal lawyer Lucien Masmejan, a partner in the Geneva-based law firm Lenz & Staehelin.

During our visit to the Swiss base in Valencia last week Masmejan was on hand to bring us up to speed with their side of the case with the Golden Gate Yacht Club. Several points came to light in this conversation that weren't previously apparent, to us at least.

Firstly, some dull legalese (its gets better) necessary to understanding the case: According to Masmejan, Justice Cahn's ruling on 27 November, when he deemed the CNEV invalid as a Challenger of Record, was not a 'ruling' but an 'opinion'. In legal semantics an 'opinion' is a written explanation to accompany a 'ruling' or a 'court order', which is the official judgement.

"After an opinion you normally have quite soon a court order that incorporates that opinion and the consequences," Masmejan explains. "That took a long time due to various motions and hearings and the first court order technically that we got was the March 17 court order which did not really deal with the content of the opinion of November 27, but with the content of two motions for re-argument that we had introduced in December." These motions included the validity of the GGYC's challenge since the certificate was ambiguous - their challenging yacht was clearly a multihull from its dimensions, yet the certificate mentioned the words 'keel yacht' in its introduction.

Masmejan continues: "This court order rejected our motions and indicated that we could go back to Justice Cahn if we disagreed on the dates. This we did on April 2nd and on April 2nd Justice Cahn indicated he was going to issue a new court order incorporating three things [CNEV being invalid, GGYC being valid and from when the 10 month notice period dictated by the Deed of Gift started].

"In the meantime we appealed the March 17 court order because we were fearing to lose the benefit of urgency and the benefit of the 30 day time limit to appeal. Now our appeal is pending in front of the Court of Appeals - as well as our motion for an expedited appeal which has in the meantime been granted and our motion to stay that is still pending - that remains undecided and should be decided by the whole panel."

The hearing at the New York Supreme Court Appelate Division will take place on June 15, but according to Masmejan their decision could come any time afterwards, in June or beyond.

Possibly not done with Justice Cahn

While the SNG may be appealing the 17 March ruling, this doesn't mean that Justice Cahn no longer has to issue the all-encompassing ruling he promised. According to Masmejan there is no indication at all of whether the judge will or won't issue this. Thus we may still get the Judge's view on when the date for the 33rd America's Cup should be - October 2008 as the GGYC would like, or July 2009 as the SNG want, with other options being May 2009 or even July 2008 if date in the GGYC's original challenge is chosen by the court as the appropriate path forward.

Obviously from Alinghi's perspective their new boat is unlikely to be ready this season and so a date as late as possible would be preferable if they are to be competitive. Alinghi have provided their break down on how long it will take to design, build and work up their new 90ft multihull. This spans a 15 month period - effectively five months design, eight months build and final assembly, two months loading and testing. They reckon their new multihull will take 40,000 manhours of design time (the same as their ACC V5 boat) and 75,000 manhours to build (this compares to 22,500 manhours for an ACC V5 boat or 100,000 for Groupama 3).

So it seems likely that if the court sides with the GGYC and goes for the November 2008 date, the SNG will continue to appeal as this is the very worst date for them - their boat will still be in build, while the new BMW Oracle weapon is likely to have been sailing for several months.

A very interesting option is if July 2008 is chosen. If this is the case then it may be that BMW Oracle Racing's boat isn't fully up to speed and Alinghi could successfully take the three race series if they pitch up in a well tried and tested ORMA 60 or hold racing in up to 5 knots of breeze at 6am each day, in which case Ernesto Bertarelli's 41ft lake racer catamaran (still said to be faster than the D35s) could be the weapon of choice.

But the fact is that June is only two months away and the prospect of a Cup occurring then is remote in the extreme. Given that the appeal has been accepted by the New York Supreme Court, plus the court having a summer break from June until September, it seems that it shouldn't be too much of a problem for the SNG's lawyers to string the legal proceedings on for the rest of the summer (according to the Deed of Gift October is the latest that the America's Cup can be raced for in the northern hemisphere).

Masmejan continues: "It is of course also possible that Justice Cahn says nothing until June 15 and that we have the hearing and we hear nothing and then in July he issues a Court Order which says 'you have to race in October (08)'. Then we have to appeal again and if we don’t get a stay of that Court Order, we would be in a position to be forced to race. It is also possible that if nothing is said, if things remain as they are today, we will have to analyse whether the July 08 dates which are still the only dates that were expressed, shall apply or not. In the Mercury Bay case when the Mercury Bay came with an application to say that it was unfair to race a catamaran versus a monohull, Justice Cipatrick said 'go and race and come back with your argument'. So today, I can’t promise that there won’t be a race in 2008 and that the day we race we will have a final, clear legal situation."

Legal to the end

So one of the few highly probable aspects of the 33rd America's Cup is that it seems certain to end where it began - in court - even if there is a little six day window in the middle of the legal wrangling for a maximum of three yacht races specified for a Deed of Gift America's Cup.

Masmajean agrees: "I think, as it has started now, the 33rd Cup might be unfortunately litigation from day one until the last stage. I remind you that in the Mercury Bay case it was more than one year after the race, of uncertainty until there was a final decision. Once it is final, it is final - then the 33rd will be over and then it will be urgent to pay attention to the legal environment of this event. Because if you look at what has happened eight months ago - we had a wonderful event here, there was a momentum, we had started to grow the event, now it has completely stopped, other teams have been excluded from the competition and that is only due to there being this weak legal structure and you have 100s of possibilities to destroy the structure. If it had not been the CNEV you could find doors everywhere. And the biggest problem is that you have no arbitration clause in the Deed of Gift, so you are entirely subject to the jurisdiction to ordinary court."


90 by 90 or up to 90 by 90?

While many have assumed that the 90ft LOA by 90ft beam, as laid down in the GGYC's challenge are maximum limits, Masmejan is of the opinion that their boat must simply be 90x90ft, not up to these sizes. He backs this up by pointing out that aAs part of a challenge for the America's Cup, the challenger must supply a certificate for the actual vessel in which they will challenge, rather than a generic type.

"The Certificate indicates A boat, not any boat, the boat of the Challenger, the challenging vessel," he says. "It goes to the extent that you give the name of the vessel. In the case of the GGYC it is called USA. That is A vessel, not any vessel."

While the challenger must specify their boat, under the Deed of Gift the defender is allowed considerably more flexibility in their equipment, the only constraints relating to LOA - 44-90ft for a singlemasted boat, or up to 115ft for one with two masts. Thus it seems highly probable that if a 2009 event is to take place then we will see it sailed in two 90ft long trimarans (a square catamaran would be a white elephant at this size).

Masmejan takes the opportunity to have a dig at the GGYC/BMW Oracle Racing: "They have issued the Challenger Certificate to us, but until now they have so far refused to issue the Coastguard Certificate which is a document that is required by the Deed of Gift to be given to the defender ‘as soon as possible’, but they play on ‘as soon as possible'."


From here

So Justice Cahn may or may not issue a court order in which he rules on the date for the 33rd America's Cup. The SNG have set the wheels in motion for an appeal and according to Masmejan this had to happen within a 30 day time limit of the ruling. The appeal, in terms of the way the Appelate Division of the New York Supreme Court carry it out is different to what tends to happen in Europe where specific aspects of a case can be ruled upon. In New York the entire case is presented once again and according to Masmejan this includes everything all the way back to Justice Cahn's 'opinion' of 27 November - ie it returns to square one, including the validity of the CNEV's challenge, etc.

"Nothing stands because, as I explained, the Nov 27 is not a 'ruling', it is an 'opinion'. Technically the Nov 27 opinion legally does not exist. It has not become a true decision. The only true decision was March 17, that was the only appealable decision. That March 17 was difficult to understand because it did not incorporate fully the content of the opinion of November 27."

So there still remains the possibility that all of Justice Cahn's opinions and rulings could be overturned. "You cannot be 100% sure," Masmajean continues. "The only situation where we would not have a match in multihulls would be if the Court of Appeal would welcome our appeal and say that the interpretation that Justice Cahn made of the Deed of Gift is not acceptable and, based on that, the disqualification of CNEV was wrong. In that case there would be no reason to be in multihulls, because I remind you that the main concrete result of this legal action by GGYC that the other teams - the British team, the German team, the South African team and so on - they all have collapsed, and they have disappeared and even if they want to come back into the competition they can’t. So of course a victory on the substance of the appeal would allow them to come back because we would then suddenly be back in the situation we had with the old documents that we have issued and which would become valid again."

So, a little more clarity to the smoke and mirrors? Frankly we hope the court decides on July 2008 to get this damned thing out of the way.