Belfast businessman Fitzpatrick in Formula 1 legal battle
Published 22/04/2016 | 02:30
Belfast businessman Stephen Fitzpatrick and a Dublin firm controlled by Russian billionaire Andrey Cheglakov are embroiled in a multi-million pound legal battle in London connected to the Manor Formula 1 racing team.
Mr Fitzpatrick is also the founder and chief executive of Ovo Energy, the British firm that is a challenger to the UK's big power companies, and whose backers include Al Gore's Generation Investment.
In early 2015, Mr Fitzpatrick fulfilled a long-time ambition to own a Formula 1 team, when he acquired Manor Grand Prix Racing, the company then behind the then Marussia racing team, out of administration.
From 2011 until then, Manor had been bankrolled by Mr Cheglakov's Marussia group of companies and raced under that name.
But having spent to the tune of over £55m (€70m) funding the team, Mr Cheglakov pulled the plug in 2014. But the Marussia team had managed to secure its first ever points at that year's Monaco Grand Prix, putting it in line to secure $90m (€80m) in prize money, due between 2015 and 2016. That money would only be payable if the team continued to race.
Mr Fitzpatrick approached Manor's administrators, as well as Formula 1 boss Bernie Ecclestone with a plan to take over the company. Mr Fitzpatrick reckoned that half the £60m (€76m) needed by Manor to contest the 2015 season could be funded by him and other income such as sponsorship, with the remainder coming from the prize money already due.
He acquired Manor in early 2015 by paying just £1.3m (€1.6m) for the secured debt owed by it to Marussia and Lloyds Development Capital. The pair had been owed a total of £27m by Manor Grand Prix Racing.
The Formula 1 regulations require that any team name change requires prior permission from the governing FIA body, controlled by Bernie Ecclestone. Mr Ecclestone turned down an initial request from Mr Fitzpatrick in early 2015 to drop Marussia from the team name. Mr Ecclestone told Mr Fitzpatrick to seek the name change during the 2015 season. Changing name without consent means accrued prize money is forfeited.
Mr Fitzpatrick's team raced in 2015 under the 'Manor Marussia' name. He claims that Marussia consented to the use of its trademark pursuant to an implied term in the oral team purchase agreement.
Dublin-registered Marussia Communications Ireland, which owns the Marussia trademark, claims the name was used without permission and could seek damages.
In the London High Court, a judge has said that Mr Fitzpatrick and Manor Grand Prix Racing have "no real prospect of prospect of proving that its use of the claimant's trademark was with the claimant's consent". He ordered that the defendants must provide security of £1.75m to Marussia if they wish to pursue specific trademark defences central to their case.