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Ecclestone loses appeal
November 12, 2004 20:16 IST
Formula One's shareholder banks drew first blood on Friday in a legal battle with commercial supremo Bernie Ecclestone for control of the sport.
An appeal court judge dismissed an appeal on behalf of Ecclestone's Formula One Holdings Ltd (FOH) and Bambino Holdings Ltd for a dispute with the banks to be heard under Swiss law rather than British.
Leave to appeal was refused, with the main case scheduled to be heard in London this month.
Lord Justice Carnwath upheld a decision that the case should be heard in Britain and stated that the alternative, to wait for a ruling in a Geneva court, would serve "no purpose but to increase delay and expense".
Although Friday's judgment concerned the narrow issue of jursidiction, the underlying dispute has major implications for the sport.
"The overall dispute concerns the control and future of Formula One racing," the judge declared in his written judgment.
The banks -- Bayerische Landesbank, JP Morgan and Lehman Brothers -- control 75 percent of the SLEC holding company that owns the commercial rights to Formula One. The other 25 percent is owned by Bambino Holdings, an Ecclestone family trust.
SLEC also owns FOH but the banks are contesting the appointment of that company's directors, arguing that although they own the majority of the shares they do not have control because of the board's composition.
The banks acquired their stake in Formula One after Germany's Kirch media empire collapsed, owing them $1.6 billion.
Ultimate victory for the banks would weaken Ecclestone's decades-long grip on the billion-dollar sport.
The case is being closely watched by major carmakers who have threatened to set up their own 'rival' series from 2008 via GPWC Holdings.
A GPWC spokesman said on Friday the carmakers and their recently appointed sports marketing consultants were pressing on with their plans.
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