Areva guilty of 'serious breach of Cup Protocol'

by Sail-World on 24 Feb 2007
Areva Challenge (FRA) has been found guilty of a serious breach of America's Cup Protocol, and has been docked two sail credits. They have also been charged costs of UKP21,000.

The incident revolves around four photographs of Luna Rossa's ITA-94 which were taken from an America's Cup Management (ACM) boat by an international media photographer, for a French newspaper, in the closed area (to allow competitors some secrecy in testing).

The ACM boat was twice asked by Luna Rossa to leave the area as they were testing, and did not.

Four of the photos were passed to Aerva (formerly K Challenge) and one of the images were alleged to show design detail on Luna Rossa that would not normally have been visible to Areva.

Further, competitors are prohibited from receiving information from a third party that would be illegal for them to obtain directly.

Areva claimed to have deleted three of the images and then retained a low resolution version of the fourth. This photo was retained for a time by Areva and distributed to key personnel within the Areva organisation.

Areva conceded that this was a 'gross error of judgment'. However Areva had operated in a frank and open manner once it was discovered that breach had occurred and Areva had acted promptly to mitigate the error once it was aware that it was in breach of the Protocol. Areva made an apology to Luna Rossa which was accepted.

It was accepted by Luna Rossa that ACM had the right to take photographers out onto the course or allow its boats to be used by the media, and all claims against ACM were withdrawn by Luna Rossa. (Cup Defenders, Alinghi, had made an input into the submission process for ACM.)

The Decision of the Jury is that Areva Challenge is found to have committed a serious breach if the Protocol governing the America's Cup and is deducted two sail credits (meaning they can only use 43 new sails in the Louis Vuitton Cup instead of 45 allowed). In addition Areva are to be charged costs of UKP21,000 to be paid within 30days.

The decision reads in part:

Decision - Breach of Protocol by Areva Challenge
[41] Article 11.2(f) of the Protocol provides that in respect of images, Competitors are prohibited from engaging in the following:
'(f) without the consent of the Competitor, observing or capturing images (photos, videos or by any other means) of another Competitor’s ACC yacht from another vessel with the principal intent and purpose to gain design or
performance information of an ACC yacht that is:
(i) outside the racing area designated in the Notice of Race (whether at the Venue or at another regatta for ACC yachts); or
(ii) inside the designated racing area and within 200 meters of the Competitor’s yacht.'

[42] Article 11.2(g) of the Protocol provides that Competitors are prohibited from engaging in the following:
'(g) the acceptance of any information from a third party that, under this Article,would have been improper for the Competitor to obtain directly.'

[43] Areva Challenge has admitted in its submission of 2nd February 2007 that copies of four of the photographs in question had come into its possession.

[44] The Jury determines that Areva Challenge has breached Articles 11.2(f) and 11.2(g)of the Protocol.

[45] The Jury notes that Areva Challenge sought to mitigate the effects of its breach of the Protocol by admitting the breach shortly after it became aware of it, and by destroying the photographs in question.

[46] Areva Challenge team members chose to view the photographs and to make the
photographs available to other members of the team, including designers and members of the afterguard. Areva Challenge properly acknowledged that such a breach was a 'gross error of judgment.'

[47] Whilst the Jury does credit the prompt action of Areva Challenge and its legal and rules adviser’s frank submissions when the breach was discovered the fact remains that a serious breach of the Protocol has occurred.

Penalty
[48] Under Article 21.4(c) of the Protocol, the Jury is empowered to impose any penalty on a Competitor that the Jury believes to be just and equitable, having regard to the nature, manner and effect of the breach. Penalties may include a fine, loss of points, and reduction in the number of sails permitted by Article 15 of the Protocol that can be used by a Competitor.

[49] The Jury is mindful that the effect of the penalties provided for in Article 21.4(c) of the Protocol may be different for each Competitor and will depend on such matters as their financial resources and how far they progress through the Challenger Selection Series and the Match.

[50] The penalty imposed by the Jury for such breach is that in terms of Article 21.4(c)(vii) of the Protocol, the number of sails permitted by Article 15.1(a) of the Protocol to be used by Areva Challenge for the Challenger Selection Series (being the Louis Vuitton Cup Rounds Robin 1 & 2, Semi-Final and Final) shall be reduced by two sails, from 45 to 43
.
Luna Rossa Challenge’s Claims Against ACM

[51] In its Reply dated 16th February, Luna Rossa Challenge requested approval from the Jury to withdraw its claims against ACM.

[52] The Jury accepts such withdrawal.

[53] Because Luna Rossa Challenge and ACM have reached a resolution of the dispute between them that is satisfactory to both Parties and because the original allegations of breaches of the Protocol and the Terms of Challenge by ACM are no longer a matter in dispute, the Jury makes no findings as to those matters.

Interim Order
[54] Jury Notice JN056 granted an interim order whereby ACM was ordered not to publish or distribute in any manner and to safely secure in ACM’s control the original and any copies of all the photographs referred to in the Luna Rossa Challenge Application. The interim order is discharged effective from the date of this decision.

Costs
[55] Pursuant to Article 21.3 of the Protocol and the Jury Guidelines for the Award of Costs, the Jury considers that Areva Challenge should meet all of the costs of this Application.

[56] The Jury awards costs of €21,000, such payment to be made by Areva Challenge to the Event Authority within thirty (30) days of the date of this decision.

Summary of Decision

[57] Areva Challenge has breached Articles 11.2(f) and (g) of the Protocol. The penalty for such breach is that the number of sails Areva Challenge is permitted to use during the Challenger Selection Series is reduced by two sails, from 45 to 43.

[58] The interim order granted in Jury Notice JN056 is released.

[59] Costs are awarded of €18,000, to be paid by Areva Challenge to the Event Authority within thirty (30) days of the date of this decision.

America’s Cup Jury:
Graham McKenzie, Henry Menin, Henry Peter, David Tillett, Bryan Willis (Chairman)