Van der Garde v Sauber – what happens next?

Discussions between the Giedo van der Garde camp and Sauber have no doubt been ongoing since Friday afternoon’s latest court hearing in Melbourne, and the hope on both sides is that an agreement can be reached overnight.

Van der Garde’s lawyer told the court that there had been “constructive discussions between the parties which are expected to continue this evening.”

The next step will occur when the court reconvenes at 9.30am on Saturday. If an agreement has been reached and both parties can satisfy the judge that everything has been sorted, that in theory should be the end of the matter, at least as far as the Melbourne weekend is concerned.

The big question is what form that agreement will take, as the problem of three drivers and two seats has not gone away. Logic suggests that the only realistic path would be a settlement which compensates van der Garde for forfeiting the seat. It’s common knowledge that his sponsors paid €8m for him to be a third driver last year as a lead in to a race seat in 2015, and any payment would presumably in effect represent a refund for that, possibly with some damages, legal costs and so on factored in on top.

As much as van der Garde genuinely wants to drive, there will be a point at which the figure offered by Sauber is sufficient for him to walk away from the team.

The big problem is of course that Sauber has long been in dire financial straits, and it simply doesn’t have a multi million sum sitting around. The van der Garde camp is obviously aware of that, and clearly would not sign up to any deal without receiving some form of guarantee or security. The obvious suspicion on their part would be that Sauber’s promises might not be backed up once the team escaped the clutches of the Australian legal system next week.

If no agreement can be reached by Saturday morning – and assuming van der Garde is not announced as a race driver for the rest of 2015 – then the likelihood is that the summons submitted by the Dutchman will be issued by the court. Sauber and Monisha Kaltenborn face charges of contempt of court.

On Friday Justice Croft mentioned an interim order, and that will probably mean that Marcus Ericsson and Felipe Nasr are free to go ahead and compete for the rest of the weekend, but the cars would be seized by the court after the race, pending more court activity. An extra problem for Sauber is that the cars and equipment could miss the slot for the FOM cargo flight to Malaysia, and would potentially then have to find an alternative way to get there.

In addition action against Kaltenborn remains a real possibility, with the court having the power to seize her passport.

Despite the positive noises made by both sides on Friday, this story is far from over…

Details of the summons, including a call for Monisha Kaltenborn to be imprisoned, can be found here: https://adamcooperf1.com/2015/03/13/van-der-garde-side-requesting-prison-time-for-kaltenborn/

16 Comments

Filed under F1, F1 News, Grand Prix News

16 responses to “Van der Garde v Sauber – what happens next?

  1. GeorgeK

    Prediction: Mr. Sauber will step up and fay any refunds out of his personal finances, ending all turmoil with GvdG, and possibly ending services of Kaltenborn as well.

  2. Andre

    Giedo doesn’t want a refund, he wants to race in F1 in 2015

  3. There have been suggestions/rumors in the Netherlands that Marcel Boekhoorn (Giedo’s father in law) is looking into buying the team (or part of it).
    Is that just Dutch wishful thinking or could there be some truth in it?
    With Renault looking to buy it could be a nice investment if he could snatch up a few % of the shares. Maybe get Kaltenborn’s share while she’s on her way out of the team?

    • Gert

      mdewals, these aren’t rumors, Marcel Boekhoorn was negotiating in 2014 to buy in at the team but couldn’t reach an agreement. I’m not sure what the strategy is for 2015 but he has the funds.

    • I am skeptical of this. Why would a smart billionaire purchase an F1 team with limited cash flow and funding, significant debt, and no in-depth design and technical strength? He may be able to buy the team for a modest amount of money, but it will cost him at least $50m of his own money each season to provide a budget that is anywhere enough. By experience is that billionaires don’t get to that level of wealth by spending their own money on long-shot or frivolous investments. They prefer to spend somebody else’s money.

      • Getting a share in the team instead of giving Giedo a seat might be profitable for him if Renault is really looking to buy a team and buys Sauber. It could be a nice return of investment for him

      • Gert

        I can’t tell what will happen but I know for sure that Boekhoorn is a very smart guy and that he won’t “waste” money on an adventure likely to be doomed. I met him a few times and he, like the Dutch co-owner of FI M. Mol, are F1 fans but won’t invest serious money if it brings them no ROI. Time will tell…..

      • John ( other John )

        I am skeptical also.
        Though Peter S has kept one of the most respected names in this sport, to bring a company, any company, to its knees, and then turn about as white knight, requires immense chutzpah. I have acted to effect something close, but on behalf of a group of creditors who wanted their money back and couldn’t get barely a penny in the pound unless the new entity became a going concern – – and, to boot, it was rather a question of who would be the last straw to sink the mixed metaphor, my apologies for the messy language. That was a very tricky composition of creditors to do…

        Anyone attempting to take over by destructive force has a uphill battle on so many new fronts. It’s everyone form minority remainder shareholders to the last forgotten supplier creditor (imagine if they laid off staff they need to hire back to do more business… just for one small idea)

        Oh ooh oh my, it would be a mess.

        But you might even so argue that the Sauber team has enough cachet to use that to muddle or muscle through a quasi bankruptcy (it would be Ch.11 not 7 in the States, though we do have similar to Ch,11 now here) where who is in charge might have a lot of discretion how to deal with creditors and business priorities – – even allowing if chapter eleven style a court must approve most major decisions…

        Maybe then the Sauber name and goodwill is just enough to make it through to the next stage before a renaming?

        Long shot.

        What else might work?

        Sauber do have very good Ferrari links, assuming you can keep the human parts in place, which Gene Haas might like.

        I like Haas, by the way. The tools they sell are amazing, what used to be big factory stuff and more for the price of a saloon car in a megabucks market. You can build saleable parts with their mills from about 30 thousand and the required installation etc. I’m not expert but a engineer manqué for sure and that was a bit of a brain banging piece of information when I read up what you could make, even as a one man band…boyhood dream stuff. I did my research, Haas are the low cost leader and pusher in a market definitely going cheaper, but they have made the effort to mark them out. I’ve zero contact even with any participants in F1, incidentally, none even second hand.

        But then we get into Haas mopping up almost the whole defunct back of grid, and spending a lot more than he probably wanted. I still cannot suss any of their strategy so will refrain from further comment.

        Is this a Hate Bomb?

        Did someone do something wrong to cause Guarde to be a pawn and stalking horse?

        I do doubt that.

        Maybe given he’s business connections he’s fully aware this may shake a tree and fruit may fall, but I don’t see that as giving him a drive.

        Just consider how much money that will cost when your driving years are few any more anyhow…

        Every way I look a it I simply see that Sauber management, maybe Monisha herself, but I cannot see how she did this alone, simply thought they would muddle or muscle through, and by the time they took (have they?) the other checks, they were in too deep.

        The reactions from Sauber all point to silly people who don’t want to own up to any mistake. Not to evil managers or expeditious statesmen doing the better good for team and sport. Just a lot of silly people too proud to admit they are wrong, and savvy enough to think that this is the soert of thing F1 supremo management can afford so not at all that they’ll get by luck and circumstance some behind the scenes manipulation that will save their backsides.

        I don’t think further punishment is much needed. Not if you se it the way I do. But contracts broken petulantly or however wrongly, need settlement.

        If this does go on, it can definitely drawn in the FIA and too much that nobody wants to be examined. The FIA might just weigh in and stop Guarde tomorrow. Malaysia may not enforce the order. It may have to wait a few races to reach a destination jurisdiction that will function like Australia has (in my opinion all above board and correct in law) and so it will simmer until buried. But then Guarde’s team could enjoin the FIA itself, and who knows who else.

        One of many thoughts that bandied about my company today: what if Ferrari could be enjoined for encouraging the breach of contract to ensure their favoured men get the chances? Nobody found a easy argument for that, but Italian courts, well they are almost mad, so anything might happen despite bias…. maybe someone thinks the newly well arrived man is the Stronzetto incarnate or something, for there is such talk about there.

        In summary the potential for this to get very silly is high indeed.

        But that would be the way to stop this otherwise apparently simply claim.

        And then who I normally agree with in this F1 media may justify saying nobody sensible agrees with van der Guarde!

  4. DW

    The new for 2016 FIA super license regulations are also going to be a factor in this all.
    If Giedo completes the 2015 season he meets the criteria for a 2016 license … if not, his F1 future is effectively over.
    At this point I’m sure that is of far more value than any monetary settlement the team can offer him.

    • GeorgeK

      First Ive read of this slant, interesting. But even if manages to drive this year, who will hire him in 2016, regardless of the budget he might bring?

      It would be hilarious if his father in law purchases a team and hires a driver OTHER than GvdG! “Sorry son, you don’t have enough experience for my team.”

      • Gert

        George, Remember Ron Dennis and Alonso? They hated each other a few years back and now they’re together again…..
        I don’t think that GvdG will be hold accountable for all of this by any other team then Sauber.

  5. thanks for providing coverage of this, Adam Cooper…

  6. JETWAKE

    Wow. What a tangled web. F1 has really changed for the worse. Hard to believe that Fernando Alonso will be driving the McLaren this year when it is over 3 seconds per lap slower than Team Mercedes and has not completed a race distance in pre-season practice! Jenson is soldiering on and KMag has crashed straightaway in FP2 in Australia.

  7. John ( other John )

    I might as well chime in with my guess:

    I am tempted to think the FIA will fudge a effective no go, based on their silence, and based (unhappily) on the way some opinions are so firmly pooh pooing the action Guarde has taken.

    I was particularly taken aback by how personal this seems to have been made by members of the Sauber camp. The suggestion that Guarde would directly sue the current driver lineup was a low swipe, IMO. There’s a few quarters acting as if the Sauber position is unquestionably ethical by fact of some kind of expedience, some which have truly shocked me.

    I think that there is the slightest and slimmest chance that at the final moment someone ex parte or the FIA themselves will argue force majeure for reasons of some clause in a (presumably in camera disclosed and not publicly shown) global liability contract for insurance.

    The judges were fairly vocal for judges (and nothing says to me they are more vocal for being Aussie judges, by the way) as to asking why the FIA have not come to explain the implications of the situation.

    I think the FIA, which we don’t really know for sure does regulate anything for real, may manage to fudge things at the last minute.

    The idea against a truly strong claim in any court is to vex the claim by making the cost of action exponentially higher. Enjoining the FIA, in yet another jurisdiction (despite they do business in Switzerland plenty as opposed to France) would multiply the complexity.

    Had Max been around, he also knew his constitutional law well enough to argue that the FIA sits as a inter – governmental body, able to effect and bring cause to it’s own internal court process, over and above that of the law of any land. As effectively was the case, for example, in re the spygate case.

    I sense that what Sauber did, resonates and will continue to resonate soundly in every way which may be wrong, for F1.

    The apparently petulant exasperation of Monisha Katernborn, invoking the Piranha Majeure of “contracts are worthless”, may come to brand the sport anew, in addition to this case and any question over whether there exists good faith in strict sense within Sauber management, concerning their actions.

    The implications of this case are indeed incredibly broad. I don’t have space I=within a modest length comment, to attempt to lay out the possible critical path dependencies or lines of potential interdependent cause and effect. But the possibilities may have many a party whetting their toungues, rustling up long dusty observations and arguments and even case law, and licking their lips.

    This case has the single necessary requirement to create a theatre: one litigant who has deep pockets and competent counsel. Not to start on whether Guarde has damn all to lose if he never drives again.

    I feel Sauber should long long ago been dissuaded, but the embattled and frustrated Ms Kaltenbornes “worthless contracts” statement may indicate that long ago someone drew up the drawbridge, and possibly there are unwilling captives inside the keep, as well.

    I can imagine subterfuge as far as takeover attempts. I’ve litigated claims that had that effect. On a much smaller scale. Successfully. This is not very high level law, though. Just tactics that are worth only the execution. And the execution is plenty god enough, so far.

    How can Sauber save face whilst Monisha K was given such a generous award of shares, for her abilities and promise? Not Peter S himself, but that sadly is the connection by name and voting share percents.

    There’s so much in F1 that is bent from any normal mould of business I would care to call sensible, that we could all come out the stronger for a proper ding dong and clean out of the fluff. But there is no guarantee of such fair enterprise. I fear the more a greater retreat from transparency and a move to ever more obscure offshore companies and murky affairs like the poorer part of the grid have suffered for employers too long. But we damned need a clear out of these dusty corners.

    It is incredibly sad for me to find any link between Sauber team and dusty corners in F1. But somehow they managed to make the link in my mind, and worse I fear that they have tried to spin quarters of the media to scorn their opponents, in a stroke discrediting sources of greater value than any minor scandal could ever spoil. To me, personally, already a painful amount of damages has been done. Where it ends, I hate to think it will not end for some while.

    This should be a wake up call for many, even if it does not turn out to pour cold water on too many slumberers.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s