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Ferrari Happenings

Ferrari Sponsor in Court Case

18.6.03

This article written by Nikki Tait was published in The Financial Times on 18 June 2003.

Eddie Jordan, the Formula One motor racing team owner, launched a $150m (£93m) lawsuit against Vodafone yesterday, claiming that the telecoms company reneged on a three-year sponsorship deal - signing instead with rival Ferrari.

The High Court was told yesterday that the case hinged on four words from a telephone conversation that took place on March 22 2001. "You've got the deal," David Haines, Vodafone's global branding director, allegedly told Mr Jordan.

According to Alan Boyle, QC, representing Jordan Grand Prix, those words were written down at the time in quotation marks by Ian Phillips, Jordan's director of business affairs, in a blue notebook that the barrister flourished in court. Jordan contends that they amounted to an unqualified commitment.

"The case in a nutshell raises two questions," Mr Boyle told Mr Justice Langley. "Did David Haines say to Eddie Jordan . . . 'You've got the deal'?"

"Secondly, if so, what was the effect of those words? Did it bring into existence a contract for the sponsorship of Jordan Grand Prix racing team by Vodafone on the terms negotiated and agreed between them prior to that date?"

According to Jordan, Vodafone decided in principle to consider sponsoring a Formula One team, and narrowed the choice to five candidates, in January. However, it also established certain criteria - for example, it did not want to be associated with tobacco advertising.

In Jordan's account, Vodafone decided by January 29 that it was the only team to meet these demands. That led to detailed talks on the possible "title sponsorship" deal spread over five separate meetings. Benetton and McLaren then emerged briefly as alternatives, before David Haines met at least one main board director in late-March, and decided to revert to the Jordan plan. The March 22 conversation followed this sequence of events, claimed Mr Boyle - and the Ferrari deal, finally agreed in May, was only explored later that month.

Vodafone, by contrast, strongly contests any liability for breach of the alleged oral agreement - or, alternatively, for negligent misrepresentation.

It agrees discussions were under way with Jordan and other Formula One teams in 2001, but says no terms were finalised and no binding contract existed. On the March 22 date, Vodafone claims Jordan knew that key terms of any potential agreement were still unresolved, and had even provided a draft contract in which many details were not finalised. It also maintains that it would be "unheard of" in Formula One for a big sponsorship contract of this sort to be concluded verbally.

The case continues.

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