The 33rd America's Cup between Société Nautique de Genève defending with team Alinghi against Golden Gate Yacht Club, and their racing team BMW Oracle Racing was the subject of extensive court action and litigation, surpassing in acrimony even the controversial 1988 America's Cup. Since the two parties were unable to agree otherwise, the match took place as a one-on-one deed of gift matchThe Deed of Gift language for this eventuality is: "In case the parties cannot mutually agree upon the terms of a match, then three races shall be sailed, and the winner of two of such races shall be entitled to the Cup. All such races shall be on ocean courses, free from headlands, as follows: The first race, twenty nautical miles to windward and return; the second race an equilateral triangular race of thirty-nine nautical miles, the first side of which shall be a beat to windward; the third race (if necessary) twenty nautical miles to windward and return; and one week day shall intervene between the conclusion of one race and the starting of the next race. These ocean courses shall be practicable in all parts for vessels of twenty-two feet draught of water, and shall be selected by the Club holding the Cup; and these races shall be sailed subject to its rules and sailing regulations so far as the same do not conflict with the provisions of this deed of gift, but without any times allowances whatever. The challenged Club shall not be required to name its representative vessel until at a time agreed upon for the start, but the vessel when named must compete in all the races, and each of such races must be completed within seven hours." in gigantic, specialized multi-hull racing yachts with no other clubs or teams participating. The Golden Gate Yacht Club swept the two races as their yacht USA 17 powered by a rigid wing-sail proved to be significantly faster than Société Nautique de Genève's yacht Alinghi 5. The litigation leading up to the match included which club would be the challenger, the dates and venue for the regattas, certain rules governing the regattas (in particular the measurement rules), and the construction of the boats.
The Americans won back the Cup after they last lost it in 1995.
When Société Nautique de Genève (SNG) successfully defended the trophy in the 32nd America's Cup, they immediately accepted a challenge from Club Náutico Español de Vela (CNEV) a Spanish organization formed expressly for the purpose of challenging for the cup and keeping the regatta in Valencia. When SNG and CNEV published their protocol for the 33rd America's Cup challenge, there was widespread consternation over its terms, with some teams and yacht clubs calling it the worst protocol in the history of the event.
The Golden Gate Yacht Club (GGYC) filed its own challenge for the Cup and then filed a court case asking that CNEV be removed as Challenger of Record as being unqualified under the Deed of Gift. GGYC also asked that it be named as the rightful Challenger of Record, being the first club to file a conforming challenge.GGYC Complaint Against SNG There followed a long and acrimonious legal battle, with the New York Court of Appeals finally deciding on April 2, 2009, that CNEV did not qualify as valid challenger, and that the GGYC was thus the rightful Challenger of Record.
Disputes
Regarding the Challenger of Record
Following its successful defense of the Cup on July 3, 2007, Société Nautique de Genève (SNG) accepted a challenge for the 33rd America's Cup from Club Náutico Español de Vela (CNEV), a newly formed yacht club, created for the purpose of challenging for the Cup. CNEV had no boats, no clubhouse, only four members (vice presidents of the Spanish Sailing Federation), and had never run a regatta of any type.Valencia Sailing: Can one become member of the Club Náutico Español de Vela? On July 5, 2007 SNG and CNEV released the protocols for the next Cup regatta. The protocol was the subject of much criticism, with some teams and yacht clubs calling it the worst protocol in the history of the event.
The Golden Gate Yacht Club (GGYC) initiated legal action against SNG in the New York Supreme Court (the court of first instance) alleging violations of the Deed of Gift of the America's Cup. (New York courts decide disputes regarding the terms of the Deed of Gift because the America's Cup is held under the terms of a charitable legal trust established under New York law). The suit alleged that CNEV did not meet the terms of the Deed of Gift as a legitimate yacht club that would qualify to be the challenger of record, in particular because it had never held an annual regatta, which, according to GGYC, was a requirement under the Deed of Gift. At the same time, GGYC issued a challenge for the Cup.
Because of the precedent set in the 1988 America's Cup where San Diego Yacht Club defended against a monohull yacht with a catamaran, any non mutual-consent challenger must specify the largest multi-hull possible under the terms of the Deed of Gift, if it is to have any chance of winning. Consequently, GGYC specified its yacht as having a 90-ft length-waterline, and 90-ft beam. However, GGYC also stated that they wanted "consensual negotiations in the spirit of the Deed of Gift toward a Protocol comparable in scope, and similar in terms, to that used for the 32nd America's Cup."
As the legal proceedings progressed, SNG continued to work with the other teams on the protocol, and by December 2007 twelve challengers had met the entry deadline and were preparing to race in a multi-challenge 33rd America's Cup. But despite extensive negotiations and proposals made by both sides, GGYC and SNG were unable to agree upon a mutual consent Protocol.
The lawsuit therefore continued and the court ruled in favor of GGYC on November 27, 2007, holding that CNEV was not a valid challenger, and declaring GGYC the proper and legal challenger. SNG was instructed to meet GGYC's challenge under the Deed of Gift terms unless they could agree on other terms by mutual consent. This order was confirmed on March 13, 2008
SNG appealed the decision against CNEV, and on July 29, 2008, the Appellate Division of the New York Supreme Court 2008 reversed the lower court ruling in a 3–2 decision. The lower court had ruled in favor of GGYC because CNEV had not held an annual regatta when it filed its challenge for the Cup. But the Appellate Division ruled that the phrase "having for its annual regatta," as used in the Deed of Gift, is ambiguous. Therefore, CNEV could satisfy the requirement by "intend[ing] to hold an annual regatta and do[ing] so prior to the date of its proposed match."
Pending the outcome of the litigation, SNG had set a deadline of December 15, 2008 for entries in the 33rd America's Cup regatta. On December 8, 2008 GGYC sent a letter to SNG to inform them that GGYC would not submit an entry since it did not consider SNG's regatta "a legitimate America's Cup" and vowed to focus on winning the legal case in the New York Court of Appeals.
A number of organizations submitted amicus curiae briefs to the court. In particular, on December 31, 2008, the New York Yacht Club (NYYC), the oldest and longest holder of the America's Cup, filed a brief supporting GGYC's position.
On April 2, 2009, the New York Court of Appeals in Albany, New York (the court of last instance) decided 6–0 in favor of GGYC, holding that a yacht club could not qualify as challenger unless it had held at least one annual regatta prior to its challenge.
Regarding the dates and the venue
After the April 2009 ruling GGYC said it would "immediately seek to negotiate with the Defender for a conventional, multi-challenger America's Cup in monohulls." However SNG indicated that they would not negotiate for a multi-challenger regatta and would fall back to a default Deed of Gift match, that is three races over a 40- (first and third race) or 39-nautical mile (second race) course between GGYC's trimaran BMW Oracle Racing 90 and SNG's catamaran Alinghi 5. Indeed, despite various calls for negotiation,Top clubs urge rivals to agree NZ Herald, April 11, 2009 it had been apparent for some time that the provisions of the Deed of Gift would likely govern the match, and, further, that the parties did not agree on the interpretation of certain provisions of the Deed of Gift or of the court decision.
In March 2008, the parties had attempted to agree on dates for the races. SNG took the position that it was entitled to a 10-month period to prepare for the race and, because it was based in the Northern Hemisphere, the races could not take place until May 2009. GGYC took the position that the 10-month notice period should run from the November 2007, when the court of first instance ruled that CNEV was not a valid challenger, so the races should take place in October 2008. Despite various attempts, the parties were unable to agree on the dates and on May 12, 2008, the New York Supreme Court issued an order setting the date at 10 months after that date. The 10-month delay was held to have been suspended during the appeals process and was reinstated by the final April 2, 2009 decision of the New York Court of Appeals. However, SNG refused to accept a race in February 2010, arguing again that the deed did not permit racing in the Northern Hemisphere until May.Standoff may spark Cup-like regattas New Zealand Herald, April 26, 2009 GGYC forced a court session and, on May 14, 2009, the court ruled from the bench that the race must take place in February 2010, unless another date was mutually agreed to.
Though the date was now set, dispute persisted regarding the venue. SNG argued that the April 2, 2009 court decision specifying "that the location of the match shall be in Valencia, Spain or any other location selected by SNG, provided SNG notify GGYC in writing not less than six months in advance of the date set for the first challenge match race of the location it has selected for the challenge match races,"http://www.ggyc.com/20080512_DecisionAndOrder (1409756_1_NY).PDF New York Supreme Court Decision and Order, May 12, 2008 allowed it to choose a venue in the Northern Hemisphere. GGYC maintained that without mutual consent, the defender must specify a deed-legal venue, which in February would mean the Southern Hemisphere.http://www.ggyc.com/GGYC-SNG%2023%20May%2009.pdf GGYC to SNG letter 23 May 2009 Under the terms of the Court order, if SNG did not specify a venue six months before the match, the venue would default to Valencia.
In August 2009 SNG announced that the event would be based in the Northern Hemisphere at Al Hamra Village in the Ras al-Khaimah emirate of the United Arab Emirates.
GGYC immediately replied that Ras al-Khaimah was not a Deed Legal Venue.http://www.ggyc.com/GGYC-SNG%20letter%20(venue)%2015%20Oct%2009%20signed.pdfhttp://www.ggyc.com/GGYC-SNG%20letter%2015%20Oct%2009%20(venue)%20pre-sig%20final.doc SNG maintained its position. GGYC filed a motion in court to request "that the Court issue an Order directing that the 33rd America's Cup be held in Valencia, Spain, in February 2010, unless the parties mutually consent otherwise."http://www.ggyc.com/GGYC%20Memo%20of%20Law.pdf According to GGYC, Valencia was mentioned in the April 2 court order as an exception, because both parties had indicated that they agreed to Valencia. Unless GGYC agreed to some other location in the Northern Hemisphere, the race must take place in the Southern Hemisphere, because the venue must comply with the Deed of Gift. Indeed, said GGYC, the expression "or any other location" in the April 2 court order could not be interpreted literally, because it could not extend to a venue like the Colorado River or Walden Pond. Given that the literal meaning could not apply, the order must be interpreted consistent with the Deed of Gift.