Have the plans of Tony Fernandes just gone up in smoke?
As predicted a few days ago in this blog – and fully explained in my feature on www.autosport.com – Group Lotus has launched an all out attack on Tony Fernandes, and claims that he has no right to use the Team Lotus name in 2011.
Fernandes had a licence from Group Lotus to use the name in 2010, but that was withdrawn by new boss Dany Bahar, who has F1 ambitions of his own. Fernandes has now bought the Team Lotus name from David Hunt. However, Group Lotus claims that it owns that name as well.
Today Group Lotus issued the following statement which makes its intentions clear:
There is and always has been only one Lotus, the Lotus started by Colin Chapman. From the beginning Lotus made road cars and raced racing cars. Until 1994, Group Lotus, the road car manufacturer and Team Lotus, which operated the Formula 1 team, were in common ownership with common directors. In 1994, Team Lotus failed and Lotus has not raced since. Since 1994, David Hunt has claimed to have acquired assets of Team Lotus, including its name, from the liquidator. He has never raced as Lotus. Mr. Hunt’s attempt to acquire the name Team Lotus was ineffective. Group Lotus is the owner of all rights in the “Lotus” automotive brand including those relating to Formula 1.
Last year, Tony Fernandes and 1 Malaysia Racing Team recognised this by taking a licence from Group Lotus to use the “Lotus” brand for the “Lotus Racing” team in the current Formula 1 season. With PROTON’s agreement, Group Lotus has now terminated its licence to 1 Malaysia Racing Team to use the “Lotus Racing” brand in the 2011 and future Formula 1 seasons as a result of the flagrant and persistent breaches of the licence by 1 Malaysia Racing Team, which were damaging to the “Lotus” brand.
Following that termination, neither 1 Malaysia Racing Team, nor any other company associated with Mr. Fernandes such as Tune Group Sdn Bhd or Team Lotus Ventures Limited, has the authority of Group Lotus to use any “Lotus” brand in the 2011 Formula 1 season. This includes the use of the brand “Team Lotus”.
Group Lotus understands that Mr. Fernandes intends to rebrand the current “Lotus Racing” Formula 1 team to “Team Lotus” for the 2011 Formula 1 season. Mr. Fernandes indicates that Tune Group has acquired the rights to the name “Team Lotus” from a business formerly owned by David Hunt called Team Lotus Ventures Limited. Group Lotus believes these rights to have no proper legal foundation, a fact of which Mr. Fernandes was well aware when his company purchased them.
PROTON will support Group Lotus in taking all necessary steps to protect its rights in the “Lotus” name, including resisting any attempts by Mr. Fernandes or his companies, or any other unauthorised person, to use the “Lotus” name in the 2011 Formula 1 season.
Dato’ Sri Mohd. Nadzmi Mohd. Salleh, Chairman of PROTON Holdings Berhad and Group Lotus commented, “We believe the Lotus brand to be one of the most valuable brands in Formula 1 today. We are the owners of this brand, and will take all necessary steps to protect it. Tony Fernandes has no rights to use the Lotus brand in the 2011 Formula 1 season, and we will strongly resist any attempts by him to use our brand without our permission and will withdraw our sponsorship of the Lotus Racing team.”
“To put it simply, Group Lotus is everything Lotus. The fact that 1 Malaysia Racing Team entered into an agreement with Group Lotus to use the brand means that both Mr. Fernandes and 1 Malaysia Racing Team recognises and acknowledges Group Lotus’ rights,” he added.
Adam Cooper F1 
Well it’s simple really (but not simple to the f1 teams obviously) if it aint yours to use, you can’t use it. It’s like me opening a burger chain and calling it mcdonalds it just can’t be done. it was under licence for 1 year and if the licence isn’t renewed then call the team something else and not try and get the name on some mad technicality through the backdoor it doesn’t work like that and i very much expect proton will not take this lying down. also i would think that a small team struggling for money would not want to upset a sponsor because they need all the money they can get and this to me would not stand them in good sted with other potential sponsors as i thimk they really wouldn’t like to get involved with a firm alledgidley using under hand tackticks. allthough it is good for f1 to have the lotus brand back it has to be done above board and not in a way it could put a bad light over f1. these are supposidly top business men and all this needs to be sorted atleast a year in advance you’d think they’d now what their doing, F1 has had enough strife with new teams will this mean another biting the bullet or will it just be rebranded with new sponsors. let’s hope so because the last thing F1 needs is to loose another team as there isn’t many more to fill the gap, and on that note let’s hope this can be sorted amicably and the great team that has been built up can carry on because all their focus needs to go into developing the new car for next year and all being said they’re not really damaging the lotus brand instead they’re bring it into the lime light and giving the brand the status it deserves, i mean how many of the younger F1 fans knew about lotus and now they do. let’s hope nothing rash is done and it’ll get sorted for the good of the sport
Craig Sylvester.
“the flagrant and persistent breaches of the licence by 1 Malaysia Racing Team, which were damaging to the “Lotus” brand.”
Jees, who says? I think they’ve done a brilliant job! Such a good job that (in my opinion) Group Lotus think they can do it as well – which I seriously doubt.
Something tells me that Fernandes would never have made his announcement over the weekend if he wasn’t completely confident that he can take these guys on.
Bottom line is it’s all very sad and the Lotus now owned by Proton is by no stretch of the imagination “the Lotus started by Colin Chapman”
Agreed – the only way this is damaging to Group Lotus is that they got out-thought by Tony Fernandes, who has done the business and then some this season – will be an interesting sideline for the rest of the season though!
I´m on Mr Fernandes side on this one…
“flagrant and persistent breaches of the licence” yeah right, when did Proton complain about even one breach? What a bunch. Go Team Lotus, based in Norfolk as before, and to heck with Proton.
Hmm – not sure how much of a case Proton really have here.
They carefully avoid mentioning that regardless of common ownership, Team Lotus was a separate company from Lotus Engineering since the 1950s. Did it ever form part of Group Lotus? I thought it was under different ownership by 1994, contrary to their statement.
There are plenty of precedents for the same brand name being used by more than one company, albeit in different spheres. Think of cigarette brand B&H which is (or was in the mid 1990s) owned by different companies in different countries. Or of the use of the name Daimler by both Daimler Benz and Jaguar (until a few years ago). I can’t see why the same principle wouldn’t apply to the use of the Lotus name for road and racing cars.
Sounds like they’re trying to scare Fernandes off…
Lotus was started by Colin Chapman in 1952, Team Lotus, which ran cars in competition, became a separate entity two years later. Lotus Engineering became Group Lotus in 1958, when the company began to build production road cars.
After Colin Chapman’s death in 1982 the Lotus ‘companies’ were re-organised with Group Lotus (the car company) being re-financed with capital from British Car Auctions, Toyota and various other parties. In early 1986 GM bought out most of the Group shareholders and, by the end of the year, had acquired a 91% stake in the road car business. This firm would later be sold on to Italian businessman Romano Artioli before Proton bought control in 1996.
After 1954 Team Lotus was always a separate entity, controlled by the Chapman Family. In 1975 the racing operations were transferred to a firm called Team Lotus International Ltd and a trademark application was made in 1988 for a “Team Lotus”, including the celebrated ACBC logo.
At the end of 1990 two former Lotus employees, Peter Wright and Peter Collins, took control of the F1 team, with a company called Team Lotus Limited, with the rights to the name and logo being assigned to this new organisation. Four years later this latter operation went into administration and a firm called Paintglossy Limited (later renamed Team Lotus Ventures Limited) bought the rights to the name and logo from the administrator. The “Team Lotus” trademark process was completed in January 1995, specifically in relation to Formula 1 racing.
Group Lotus challenged this decision in the courts in 1998 – after the Proton takeover – and lost.
Thanks to Joe Saward –
My guess is that a “precident” has already been made/set with regards to names logos etc. My guess is that this is a “power struggle” that regretfully will/does involve Tony Fernandes. It is very sad that this type of activity is being “resurected” around Lotus as it is so familiar to the 1980’s situation with Lotus being sold/not sold etc…