NEW YORK (JULY 23, 2013) — International law firm McDermott Will & Emery today announced that it has filed papers on behalf of its client, African Diaspora Maritime Corporation (“ADM”), in the Supreme Court for the State of New York, New York County, seeking to enjoin the running of the 34th America’s Cup races, scheduled to begin on September 7, 2013 in San Francisco.
ADM is a sailing syndicate founded in 1994 by Charles Kithcart dedicated to training young African-Americans as competitive race sailors and related causes. In 2011, ADM filed an application with Golden Gate Yacht Club (“GGYC”), the current trustee of the America’s Cup, to defend the Cup in this year’s contest. The ADM team consisted of three Olympians, an All-American, additional award-winning sailors, and an America’s Cup winning yacht designer.
ADM alleges that GGYC denied ADM’s application in bad faith. Oracle Corp. Chief Executive Officer Larry Ellison is the chief benefactor of GGYC, which is now the home of Team Oracle Racing, and which won the America’s Cup in 2010.
On June 25, 2013, the New York State Appellate Division, First Department, reversed the trial court’s dismissal of ADM’s breach of contract claim. The court held that ADM stated a valid claim that GGYC had acted in bad faith by its allegations that GGYC: (i) attempted to “sabotage” ADM’s application by denying ADM information that ADM needed to complete the application; (ii) initially rejected the application for false technical reasons; (iii) falsely asserted that ADM had lied about its team; and (iv) falsely asserted that ADM lacked the necessary resources to compete, even though it is well known that America’s Cup teams do not obtain their funding until after their applications are accepted.
“GGYC apparently decided to give Team Oracle Racing …a free pass so that (they) did not have to compete in any Defender Series and would instead compete in only one race against a foreign challenger for the Cup,” McDermott’s brief argued.
The Court has scheduled a conference for Wednesday, July 24, 2013, to schedule a hearing on ADM’s application.
“If pure fear of competition was not the real motive [for denying ADM entry into the competition], then one must ask: why not let ADM into the ‘club’?”, McDermott’s brief argued. “[W]hy not allow a qualified team of sailors assembled by an African-American not-for-profit organization from North Carolina to compete [in this year’s race]? Including ADM could have been a publicity boon for GGYC’s claimed attempts to move yacht racing into the mainstream by attracting hoards of spectators into San Francisco [for the America’s Cup]…. Perhaps the only thing that GGYC and its controlling benefactor feared more than being beaten by another U.S. team was being beaten by this U.S. team.”
McDermott’s Trial Practice Group takes on, and consistently wins, the most demanding cases for clients. McDermott’s skilled trial lawyers combine courtroom skills with a deep understanding of substantive areas of the law. This combination positions clients to resolve matters quickly, but with the confidence to go to trial when necessary.
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