Coutts' letter released to ISAF President on Cup secret agreement

by Richard Gladwell on 20 Sep 2009
In a confidential letter to the International Sailing Federation, BMW Oracle Racing skipper and CEO, Sir Russell Coutts requested a meeting with the ISAF Executive Committee.

The Executive Committee met last weekend in Copenhagen, Denmark and Sail-World understands that a meeting took place, with both BMW Oracle Racing and Alinghi, meeting separately with the ISAF.

There does not appear to have been any direct outcome from that meeting.

However late last week the International Sailing Federation and Societe Nautique de Geneve released the previously confidential agreement, just two days prior to a Telephone Hearing convened by Justice Shirley Kornreich of the New York Supreme Court. The agreement was signed between the ISAF and Defender on 5 June 2009, and remained confidential for over three months.

At that very short Hearing, on Friday, and because the confidential agreement had been released, the agreement document was declared to be 'moot'.

Now, Golden Gate YC, the Challenger for the America's Cup, have released their previously 'Redacted' motions to the Appellate Division of the Supreme Court. That motion had substantial portions removed due to the requirements of the confidentiality agreement, however the full version reveals that GGYC are claiming SNG has contravened assurances over measurement previously given to the Court.

At the centre of GGYC's claims are that in oral argument before the Court, SNG committed to the Court that ISAF would be required to approve any further rule changes for the 33rd America's Cup, and further that SNG would not issue rules that would disqualify GGYC's boat.

GGYC, as a member of USSailing (the national governing body of the sport in USA), is indirectly affiliated to ISAF, as is SNG through the Swiss sailing federation. Because of this relationship, Coutts believes the two clubs should be treated equally by the world parent body.

Coutts writes: 'Throughout our Challenge and this litigation, we have relied on the fact that ISAF and its rules will provide protection to us as a competitor, by virtue of its neutrality and the fact that it traditionally sits above the competitors.

'However, the Agreement skews that balance and abrogates all of the protections that ISAF normally provides. Specifically, the Agreement gives special rights and privileges to SNG, which is both the organizing authority for and a competitor in the 33 America’s Cup, and to its affiliate AC Management SA. The result is a situation which is grossly unfair to OGYC as one of the two competitors, and which has the potential to bring the sport of sailing into disrepute.

The full text of the letter from Sir Russell Coutts to ISAF President, Goran Petersson follows.

A four page analysis of the points of issue in the Rules issued, so far, for the Match and statements contained in the ISAF/SNG Agreement can be found by www.ggyc.com/09 08 24 RC-ISAF Letter.PDF!clicking_here.

Letter to the International Sailing Federation

Dear Göran,

On behalf of Golden Gate Yacht Club ('OGYC') and BMW ORACLE Racing, GGYC’s racing representative for the 33 America’s Cup, I write with respect to the Agreement between the International Sailing Association ('ISAF') and Société Nautique de Geneve ('SNG') dated 5th June 2009 and signed on behalf of ISAF by Jerome Pels and David Kellett (the 'Agreement').

As you know, GGYC is a member in good standing of US SAILING, the National Authority for the United States of America, and is the Challenger for the 33 America’s Cup. BMW ORACLE Racing represents GGYC in its Challenge.

The purpose of this letter is to inform you formally and directly of the concerns we have with respect to the terms of the Agreement (our objections are itemized in Attachment A to this letter), and to seek your help in resolving these issues in a fair manner so that the 33( America’s Cup can go forward as a proper event.

Throughout our Challenge and this litigation, we have relied on the fact that ISAF and its rules will provide protection to us as a competitor, by virtue of its neutrality and the fact that it traditionally sits above the competitors. However, the Agreement skews that balance and abrogates all of the protections that ISAF normally provides. Specifically, the Agreement gives special rights and privileges to SNG, which is both the organizing authority for and a competitor in the 33 America’s Cup, and to its affiliate AC Management SA. The result is a situation which is grossly unfair to OGYC as one of the two competitors, and which has the potential to bring the sport of sailing into disrepute.

It has been said that the Agreement is similar to prior agreements between America’s Cup organizers and ISAF. However, a premise of the prior agreements has always been a closely negotiated agreement between the Defender and Challenger called the Protocol, which provided very specific terms to ensure fairness in the competition and was in place before any ISAF agreement was finalized. (See Attachment B.) Without those underpinnings, the ISAF/SNG agreement simply transfers all of the control of the regatta, its rules and its officiating to one competitor, without any of the normal protections that ISAF provides to competitors. This is not consistent with past practices, and it is not consistent with the principles of ISAF or good sportsmanship. Although the Court in NY recently ruled that SNG can make changes to the rules, this was with the Court’s understanding (from representations in court by SNG’s counsel) that normal ISAF procedures and the resulting protections for the competitors, would be in place. Moreover, it is a secret agreement with obvious potentials for abuse, all with the authorization and authority of ISAF.

If the Agreement has not yet been approved by the Executive Committee, we request that our concerns be considered and addressed prior to such approval. On the other hand, if the Agreement has already been properly approved by the Executive Committee, we ask that the Executive Committee reconsider that approval in light of these concerns. In either case, we ask that we be given an opportunity to make a presentation to the Executive Committee at or before your September meeting. We respectfully request your prompt response as to whether the Agreement has been approved by the Executive Committee and whether we can make a presentation regarding our concerns.

Additionally, we respectfully request that the confidentiality restrictions on disclosure of the Agreement, which SNG has represented to the New York Court are in response to ISAF’s concerns, be removed. This provides transparency of the ISAF processes and allows us to discuss all our concerns with ISAF officials involved in the Match without risk of breaching the court order. At the very least, the Agreement should be made public when it finally has been approved, if that has not already occurred.

In the meantime, we stand ready to work with you or any members of the Executive Committee to resolve this matter in a fair manner. Our highest priority is to race the 33 America’s Cup with fair rules and a competitive playing field.

Sincerely yours

Russell Coutts
Skipper