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Force India responds to court ruling

NEWS STORY
05/05/2012

Mat Coch writes:

Force India has responded to yesterday's High Court ruling, which stated it must pay £650,000 to Caterham and Mike Gascoyne, a figure which amounts to the cost incurred by the defendants during the case. It is also in addition to the £665,000 the Judge awarded to Aerolab in March.

Force India was originally sued by design firm Aerolab for unpaid services. The Italian firm began proceedings ahead of the 2009 Italian Grand Prix, forcing the team to either submit £870,000 in security or have its cars and equipment impounded.

In October 2009 Force India lodged a suit against Aerolab, suggesting the firm failed to clear its system of its intellectual property, which it then systematically copied as it developed Caterham's first Formula One car - the Lotus Racing T127.

Force India was initially seeking more than £15million in damages but was only award £20,000 when the ruling was handed down in March. The Hon Justice Arnold, who presided over the case in the UK's High Court, believing the figure a fair market rate for the Force India data which was used.

At the time both Caterham and Force India claimed victory. Force India believed the fact damages were awarded proved that systematic copying did take place while Caterham claimed victory because nothing was found against it, clearing the team and Gascoyne's names. Aerolab was awarded £685,000 to settle its outstanding debt.

Force India then elected to appeal the decision on the basis that the £20,000 is not sufficient compensation. The appeal has not yet been approved; a hearing on whether it can be pursued is due in a few weeks. For the right to appeal to be successful it's understood the team must either produce new evidence substantiating its claim of systematic copying or prove that the presiding Judge did not fully understand the case.

Yesterday's ruling was not a decision on that appeal but on who is liable for the legal costs incurred dating back to the case in March. As reported by Pitpass the decision went against Force India, which has to pay £400,000 to Mike Gascoyne and £250,000 to Caterham within 14 days.

In response Force India produced a three line statement, the final sentence of which read;

"The interim costs payments awarded to Mr Gascoyne and 1 Mayalsia Racing (Caterham's parent company) in today's ruling are more than covered by funds already provided by Sahara Force India Formula One Team as security for costs pending the outcome of the case."

It is true. Force India has submitted £870,000 worth of security however the costs awarded yesterday must be added to the damages the court awarded to Aerolab, even if it is currently on hold pending appeal. Combined the total adds up to more than £1.3million, nearly £450,000 more than the team submitted as security. Pitpass contacted Force India for clarification on that point, though no response was received.

Should Force India's appeal against the £20,000 damages it was awarded in the initial case fail it will have to pay £665,000 to Aerolab with only £220,000 left in the security fund. There may well be costs added on top of that, though even without Force India could well pay £445,000 on top of the £870,000 it was forced to front as security back in 2009.

It's worth remembering that throughout this Force India will have been incurring legal costs of its own. That figure is unknown though one can estimate it as being somewhere on a par with the costs that have been awarded, £650,000, unless it's negotiated a no-win no-fee arrangement with its counsel.

Essentially it means that, unless Force India wins its right to appeal and has damages reduced to £220,000 or less it will end up further out of pocket - the £870,000 worth of security had to come from somewhere, after all.

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