Lasers - Applying a Blow Torch

[Wess]

Its OK to like the guy and hate those running the class. Have your bromance w Bruce - its all OK. By all means, carry the tourch for him and even feel free to send him all your money to ensure he is not destitute.

But you may want too re-read this. A few times. Really carefully.

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2011 RULE CHANGES - VOTING ENDED 23RD SEPTEMBER 2011

IMPORTANT Rule change

This rule change is very important for the future of the class. The change and the explanation have been approved by the Laser Class World Council and the Laser Class Advisory Council. Please do not delay your vote.

For 40 years the ILCA Class Rules and associated agreements concerning the management of the class have given the sailing world the most successful youth and adult racing class in history with over 200,000 boats built and racing in over 125 countries.

This success, we believe, is based fundamentally on the ILCA Class Rules, which requires that a builder of class-legal boats must (among other things) (i) manufacture the hull, equipment, fittings, spars, sails and battens in strict adherence to the Construction Manual and (ii) have the Laser trademark rights.

In addition, a builder also needs a building agreement from Bruce Kirby or Bruce Kirby Inc. This provision is mostly historical. The rule was instituted at a time when Bruce Kirby held certain design rights. The ILCA is not a party to any of these Kirby agreements.

Unfortunately, a dispute has arisen between parties who claim to be representing Kirbys interests: a New Zealand company called Global Sailing; and Laser Performance Europe (LPE), one of the manufacturers, which holds the Laser trademark rights for Europe, South America, Africa and Asia (excluding trademark rights owned by Performance Sailcraft Japan for Japan and South Korea). The dispute centers on whether a valid design rights holder agreement exists with LPE. Under the current ILCA Class Rules, if there is not a valid building agreement, then a manufacturer, even a trademark owner, would not meet the requirements to be an International Sailing Federation (ISAF) and International Laser Class Association (ILCA) approved builder.

Each of the parties to the conflict has threatened ILCA in various ways Global Sailing has said it may form a new class association for a Kirby Sailboat. LPE informed the ILCA that it intends to form its own Laser class. We may therefore end up with three different classes and may lose the Olympic status. The one design / out of the box principle would also be threatened.

One other possible result of this conflict is that due to uncertainty over ISAF and ILCA approval, there may not be a sufficient quantity of new Laser boats compliant with the ILCA Class Rules available in Europe and other countries in 2011 and beyond to satisfy the demand of its current and future ILCA members.

The class officers made numerous attempts to get the two conflicting parties to end their dispute: meetings were held in different parts of the world and written compromise proposals were made, unfortunately with no success. While discussions between the two parties continue we are unsure of the outcome and running out of time.

We also took legal advice. The above rule changes were deemed the only possible solution in order to promote the uninterrupted supply of class legal Laser boats and to maintain ILCA in its current set-up. The lawyers also informed us that the Kirby design patents had in fact expired.

Therefore, we are proposing to change the rule to eliminate the building agreement from Bruce Kirby or Bruce Kirby Inc requirement. Manufacturers who have trademark rights and who build in strict adherence to the ILCA Rules and to the Construction Manual, which is controlled by ILCA, will continue to have the right to build Class legal boats. We believe that this change will eliminate uncertainty over ISAF and ILCA approval, give manufacturers continued reasons to support the class and satisfy the demands of current and future class members.

Why should you vote YES?

1.To promote the uninterrupted supply of class-legal Laser boats all over the world to meet the demands of current and future sailors.

2.To maintain the International Laser Class Association in its current set-up.

3.To preserve the one design / out of the box principle, which is assured by the mandatory adherence to the Laser Construction Manual by all builders as defined in the fundamental rule.

4.To maintain ISAF recognition and Olympic status.

Heini Wellmann,

Laser Class President

Jeff Martin,

Laser Class World Executive Secretary

It is proposed that the following rule changes be adopted. The additions are underlined. The deletions are crossed through (strike through). They are:

Class Rule changes to the Fundamental Rule

CLASS RULES, PART ONE

FUNDAMENTAL RULE

Current Rule

The Laser shall be raced in accordance with these rules, with only the hull, equipment, fittings, spars, sail and battens manufactured by a licensed builder in accordance with the Laser design specification (known as the Construction Manual) which is registered with ISAF.

Proposed new rule with changes

The Laser shall be raced in accordance with these Rules, with only the hull, equipment, fittings, spars, sail and battens manufactured by a licensed an International Sailing Federation (ISAF) and International Laser Class Association (ILCA) approved builder in accordance with strict adherence to the Laser design specification (known as the Construction Manual) which is registered with ISAF.

Current Rule

A Builder is a manufacturer that has a building agreement from Bruce Kirby or Bruce Kirby Inc. to build the Laser and has the rights to use a Laser trademark and has been approved as a Laser Builder by each of the International Sailing Federation and the International Laser Class Association.

Proposed new rule with changes

A Builder is a manufacturer that has a building agreement from Bruce Kirby or Bruce Kirby Inc. to build the Laser and has the rights to use a Laser trademark, is manufacturing the hull, equipment, fittings, spars, sails and battens in strict adherence to the Construction Manual, and has been approved as a Laser Builder by each of the International Sailing Federation and the International Laser Class Association.

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The patent line you focus on does not say they are or are not Laser patents. Keep in mind that patents list claims. It is possible that some of the claims listed in a patent for a 2 sail boat may apply to the hull, spars, sail, foils or what have you, of a 1 sail boat like a Laser for example. We have no way to know if these or any patents were thrown up as being relevant or not. The simple fact is if he has any valid rights (trademarks, patents, etc...) he will be paid (up front or via damages) and deserves to be paid.

Now keep in mind that ISAF and ILCA is not party to the contracts in dispute between BK and the builders. So tey don't know what it says or what rights BK claims with them. So cover all the bases...

I would and did read the ILCA statement differently than you have and as typical legal stuff covering all bases. They noted the Laser trademark was controlled LPE and gathered they then did the usual CYOA of searching for any BK patents that might even loosely apply and noted that any such patents had expired. Note they never call them Laser patents.

From there what is left is what BK has always claimed which is the construction manual. Interestingly the class statement says that is "registered" with the ISAF. Not clear what registered means and exactly what rights if any either BK, the class, or the builder has to this. I am also going to guess that over the years it has evolved fairly significantly from that BK(?) - or the original byuilder - originally wrote to something heavily modified (guessing by the current and past manufacturers - ie folks other than BK) as constrction techniques, tolerances, and materials were changed so I am not sure that BK could or does own the current version of the construction manual or if the class or current builder(s) does.

The patents and statements around them are nothing to hang your hat on and I would be surprised if its anything more than lawers covering all the bases. Its also not about the Laser trademark or statements around that. All the parties seem to concede its valid and controlled by LPE (for the territories in dispute).

The fight is going to be around the construction manual and contracts and statements related to that AFAIK. Oh, and the BK name trademark which seems to have caught everyone by surprise.

But by all means continue your bromance. Personally I think they all (BK, LPE, GSA) deserve a kick in the nuts as they say. I am standing with ILCA and wish they had the power to kick all these bums out and take control of the builders (they don't because of who owns the Laser trademarks which means we are stuck w LPE).

 

[Bruce Hudson]

That statement in 2011 has a lot wrong about it. I wonder if the lawyer whose advice was sought will ever be named, whether the ILCA still think the advice is good. This matter is much bigger than the ILCA. It's mostly about contract law, though it's also it about ownership.

I was very uncomfortable reading the ILCA statement when it was released back in 2011, though like most have moved forward since then. (That statement should be a source of significant embarrassment for the ILCA. It includes "The lawyers also informed us that the any Kirby design patents would have certainly expired." ...which says more about forked tongues than provides anything meaningful. Of course we know that there never was a patent.)

By the way, where do yacht designers register their designs? Read up about the Bonito/Thundercraft Boats case. Take a look at the "Vessel Hull Design Protection Act" (which doesn't apply - but the rationale behind the law provides interesting reading). Remember - Kirby's boat was designed in 1969 in Canada - there is international ownership to consider! There was never any registration of his design. It's laughable that the ILCA pin their legal hopes on the lack of registration of boat design, yet here we are.

The ILCA is also pinning their position on the transaction between Global Sailing and Kirby - which was subsequently reversed.

Bruce Kirby's legal position puts forward a clear position that he is the rightful owner of his design. In addition to that there are signed contracts showing that Bruce Kirby's boat were manufactured with his permission - pretty conclusive acknowledgement of Kirby's ownership by the parties at the heart of this.

The ILCA can declare whatever they like, but they were independent to the bilateral contracts between the guy who owns the design, and the companies who make the boat. That was until they took sides by giving plaques to LP.

This issue is not about the name on a plaque, or the Laser name. It's about the boat design, contracts between Kirby and manufacturers.

If the Kirby contracts with the builders are unenforceable, like already mentioned previously, I'd sure like to find out why.

 

[Otterbox]

It would seem there is very little for ILCA to be proud about in their presentation of the the reasons for the Vote Yes for the Fundamental Rule change.

Whether its legal to present inaccurate information or not, I imagine Bruce Kirby and his legal team will certainly consider them commerica lly damaging and if the US courts agree, that means it will cost us ILCA members money.

 

[Mambo Kings]

For those of us who sailed Lasers in those early days and saw the class take off, it is sad that the role of Ian Bruce seems to be getting forgotten in all this turmoil.

The concept of a single handed car toppable performance boat, the fateful phone call to his friend Bruce Kirby, building the prototype for the Teacup regatta in his shop, refining the prototype to get it right and then his passion and work to build fleets and make it a commercial reality. All of us who have had so much fun in this craft owe Ian Bruce a very big thank you.

I hope all of this can be resolved soon.

 

[BalticBandit]

Well its pretty clear that in writing the "patents expired" sentence, the ILCA was acting in a manner that either fails the due diligence test of uncovering whether those patents are applicable, or violating the requirement as trustees of a Not For Profit organization to accurately present the issues in a manner that is "In Good Faith". This has the potential to expose the ILCA to liability - depends of course on what court and jurisdiction the suits are finally heard as to how that sorts out.

Similarly there is the questionable assertion

who build in strict adherence to the ILCA Rules and to the Construction Manual, which is controlled [emph added] by ILCA,

not sure what "controlled" means legally in this situation. If in fact Kirby still owns the Copyright on the CM and the ILCA simply controls its distribution, then I assume such "control" is based on some agreement between Kirby and the ILCA, which in turn voids the claim that "The ILCA is not a party to any of these Kirby agreements. " potentially a second misrepesentation.

Alternatively if they do not own the copyright for the CM and don't actually have any sort of contractual ownership of such, then they are in a very precarious position to claim control.

Frankly I would not want to be in Jeff Martin's shoes right now.


Sadly this all reminds me of the broughaha over the Inland Sailing Associations A Scow disaster. But the $$$ and sailors affected are a much bigger deal.

 

[dogwatch]

ILCA.......violating the requirement as trustees of a Not For Profit organization

Assuming the Kirby filing is correct that "ILCA is a British organization" then there's no such thing (directly) as a "Not For Profit organization" here. There are "Community Interest Companies" - ILCA is not registered as such.

 

[BalticBandit]

Ah ok. So ignore all wrote - because it does not apply outside the USA

 

[Reht]

So a British organization is being brought to court in the USA, who's rules apply?

 

[ojfd]

It seems that everybody is very concerned about the BK's money.

Does anyone know for sure how much, per boat, went to Julian Bethwaite (49er), Andre Cornu (470), Christian Maury (420), Jack Holt (Cadet), Ian Proctor (Tempest, Topper etc.) or any other boat designer?

 

[BalticBandit]

So a British organization is being brought to court in the USA, who's rules apply?

Normally it would be the rules of the court of jurisdiction. So if the contracts were executed in the USA, then my analysis might still hold

 

[dogwatch]

So a British organization is being brought to court in the USA, who's rules apply?

In general, contracts say which jurisdiction applies and IIRC those under discussion say laws of Connecticut. However that's not really the point for the purposes of this (limited) discussion. ILCA isn't a "Not for profit organisation" which (afaik) has a specific meaning in the US tax code. That was an incorrect assumption. ILCA doesn't appear to be registered as a company in Britain at all, non-profit or otherwise. They don't have to be - a class association I helped run wasn't set up as a company. There's a benefit to being a company because it makes a clear legal demarcation between the assets of the association and the personal assets of the officers - something ILCA might be wishing it had. But it also costs a few £100s a year to perform the legal duties of a company so small organisations may not bother.

 

[BalticBandit]

ooh if they aren't incorporated, then the officers of the ILCA are potentially personally liable for any damages to BK.... ouch! I gotta say, I would not be an officer of any organization that is not protected by a corporate shell - at least not if the litigation is to happen in the USA

 

[KiwiJoker]

It would seem there is very little for ILCA to be proud about in their presentation of the the reasons for the Vote Yes for the Fundamental Rule change.

Whether its legal to present inaccurate information or not, I imagine Bruce Kirby and his legal team will certainly consider them commerica lly damaging and if the US courts agree, that means it will cost us ILCA members money.

Agreed. Of course it all still hangs on whether Kirby's original building agreement still applies 40 years on. He and his law team apparently think sol

This is the first time I've read the full ILCA rationale for rule change. Disingenuous at best. Duplicitous might better characterise their actions. They simply glossed over any history showing why builders around the world had been paying royalty fees to Kirby for the past 40 years.

This is the paragraph that is particularly disturbing:

"In addition, a builder also needs a building agreement from Bruce Kirby or Bruce Kirby Inc. This provision is mostly historical. The rule was instituted at a time when Bruce Kirby held certain design rights. The ILCA is not a party to any of these Kirby agreements."

Mostly historical! No attempt at all to explain to members why or where Kirby's "certain design rights" vanished in recent history and don't matter any more. And hey presto, the ILCA tells us that anyway, they are not party to these agreements. C'mon! If the agreements are still valid, the ILCA's rights are surely subordinate to Kirby's.

 

[Otterbox]

Just published here in the UK http://www.sail-world.com/UK/Laser-ISAF-ILCA-action-brings-expanded-Bruce-Kirby-law-suit/109015

Bruce Kirby lawyers have just raised the stakes again, piling more material into the US Federal Court system after ISAF - ILCA´s actions to take Kirby´s design rights from him.

One wonders if the US Courts will take a dim view of the new actions from Sailing´s Peak body?

 

[Smithy]

Those who seem to love slagging off the class officials here are getting themselves really twisted up on the vote issue and the "patent" thing. There are "patents" and there are "design patents" - they are different. See http://en.wikipedia.org/wiki/Design_patent for a summary. A "patent" covers an invention, a "design patent" as the article says "is a type of industrial design right"

Now read the ILCA statement again. Early on, it says the contracts were put in place when Kirby held "certain design rights", which he will have done. Then towards the end it says they were told the "Kirby design patents had expired". People are getting all excited about Kirby's two "patents" which clearly don't apply to Lasers. But they are irrelevant - ILCA never refer to "patents", just to "design patents". Now there's nothing to say that Kirby's "design rights" were formally registered as a "design patent", but the only sin ILCA have committed here is to refer to "design patents" when it looks as though they should really have just referred again to "design rights". But all they are really saying is that whatever rights Kirby had over the design itself in the early days/years had expired by the time the contractual disputes over the separate commercial agreements started up. I don't see the probably mistaken reference to "design patent" rather than "design right" as material at all - in fact the average Laser sailor voting on the rule change probably wouldn't give a toss just what exact legal form Kirby's "rights" had taken. And as to that slip being libellous - dream on

Otherwise the ILCA statement just accurately reflects the situation at the time - the class were being pushed around by people arguing over contracts the class weren't even party to. And as Kirby had sold his interest to someone else it was all but impossible for the builders of most Lasers to meet the class rule requirement that they have a contract with Kirby. So although Kirby may well have been seeking to find a good future guardian for his baby, you have to wonder what due diligence was done as to the consequences of the sale - had that little consequence not been spotted? Seems to me the class reaction was all they could do to keep things going. Otherwise I hear lots of vague muttering about the vote not being "proper" but preciously few specifics about exactly what was wrong with it or with the ILCA statements in general

And I'm afraid the arguments that ILCA had in some way a duty to argue that everyone should keep paying money to Kirby even if any design rights he originally held had reached their normal expiry date under the law, and that ILCA were "dishonest" or "disingenuous" in not doing so, rather overlook the fact that he had by then, er, sold his interests anyway... perhaps that is why the matter is viewed as "historical"?

 

[Sloan]

Just published here in the UK http://www.sail-world.com/UK/Laser-ISAF-ILCA-action-brings-expanded-Bruce-Kirby-law-suit/109015

Bruce Kirby lawyers have just raised the stakes again, piling more material into the US Federal Court system after ISAF - ILCA´s actions to take Kirby´s design rights from him.

One wonders if the US Courts will take a dim view of the new actions from Sailing´s Peak body?

Just finished reading the law-suit filed by Kirby and without seeing all the attachments relating to the builders agreements, it is not looking that great for ISAF and ILCA.

It would appear, as you would expect, that the transfer of ownership every time a builder sold to another party will not void an existing building agreement. The building agreement was always transferred properly into the new ownership structure and all the benefits and obligations of that agreement became the responsibility of the new owner. The act of transferring ownership of a company that includes agreements that both convey a financial benefit and financial responsibility does not in any way remove those obligations. otherwise companies would just on sell their enterprise to a shell company and then say to the person who licenses their service or product, " we have no agreement with you now". It is my belief that the builders agreements will be ruled valid in court.

In regards to ISAF, the following part of the suit seems to directly address the issue of what rights he had in the agreement with ISAF then known as IYRU. If Kirby removes that licence it would seem quite clear that they must stop participating in the production, distribution of Lasers or be in breach of their agreement.

On or about November 30, 1983, BKI and Bruce Kirby entered into an Agreement (“ISAF Agreement”) with Performance Sailcraft, Inc., Laser International Holdings Limited, ILCA, and the International Yacht Racing Union (“IYRU”), copy attached as Exhibit 3.

The ISAF Agreement governed the production, distribution, and management of Kirby Sailboats approved for officially sanctioned sailboat races worldwide. Section “Agreement 1” specifies that all authorized builders of Kirby Sailboats must have a license from Kirby.

It would appear that Kirby had building agreements in place with the relevant defendants and that those building agreements were documents that had been updated as occasion demanded over the years. The 1983 builders agreement being amended and signed by both Kirby and the builders as recently as June 16, 2005, with other amendments occurring in May of the same year and August 1995. That would make these documents very relevant indeed to any legal proceeding.

In regard to the plaques and his rights:

Article 6.1 of both the 1983 and 1989 Builder Agreements, give Kirby the right to issue and assign Hull Numbers/Sail Numbers for use to build and sell Kirby Sailboats.

Article 6.2 of both the 1983 and 1989 Builder Agreements give Kirby the right to refuse to issue Hull Numbers/Sail Numbers to any builder that owes and has not paid royalties to

Kirby.

ISAF and ILCA are in the middle of this and it could be argued that by sidestepping their own rules they may have damaged Kirby and his interests and be held liable. If Kirby notified them in October 2012 that a builder was delinquent and that no further plaques were to be issued as per the signed builders agreement and they continued to do so wilfully it would look very poor for them in court. They can change their own rules but they can not change an agreement that are not a direct party to, such as the builders agreement, and that builders agreement helps define what constitues a legal and authorised boat.

From my reading of the lawsuit he would appear to have the material he needs to back up his claims and if a court rules that the builders agreements were active and valid documents it will not go well for the defendants. Yes, it is only one side thus far, but he makes some quite compelling arguments that right is on his side.

 

[qusnewt]

It's real simple. ILCA records show that they paid over $60,000 for legal work that presumably included a legal opinion of Kirby's design rights and/or patents. That legal opinion will be in writing and show the attorney's findings. US design patents only have one claim which is an ornamental design for x, y or z. Making a mistake in reviewing a design patent is extremely basic and highly improbable that even a first year attorney might get that wrong.

If the attorney got it wrong and the ILCA accurately reported the attorney's findings and relied on it (to their detriment), then the attorney's malpractice insurance will cover the damages to the ILCA and Kirby. If, however, the ILCA knowingly made an intentionally fraudulent misrepresentation, there will be consequences not only to the previous officers but to the present officers because it would be an ongoing misrepresentation that they became aware of and did not correct and the vote went through for approval under their watch. Let's hope that if it was fraud that they take immediate steps to void the vote and rule change before having to produce the attorney's legal opinion in court. Isn't there something in US law about officers being personally responsible for illegal acts committed while serving as officers of any type of organization.

 

[torrid]

If this mess ever goes to trial, I'll feel sorry for the non-sailing jurors trying to keep straight the labyrinth of parties involved in all the legal contracts. They'll probably wonder why so many people get so worked up over some silly little boats. And they might think you could be criminally prosecuted for using a non-legal sail in a sanctioned race.

 

[IPLore]

There is a huge difference between pointing out how some actions taken by the ILCA could easily result in problems for the ILCA and its officers And Harping endlessly about how the volunteers and employees of that organization are bad people.

I firmly believe everyone involved in the ILCA is doing his or her best to cause what he or she feels is the best thing to happen.

...

It is likely the individuals who are able to purchase the most ABLE advocacy will suffer the least post legal decision damages. Of the participants in this suit either Kirby or the ILCA has the shallowest pockets.

My edit.

Based on the amended complaint, BK is represented by a very able firm of CT IP lawyers.

Respectfully, I have never heard of the ICLA's counsel.

Its not clear who is representing ISAF in the US.

The amended complaint didnt include the notice of service on LP.

It will be interesting to see if LP wheel out any of the big national specialist IP guns (Fross Zelnik, Finnegan, Fish and Chips, Morrison &F). Probably not enough money in it. Maybe a local firm like Day Pitney. Anyone seen who is representing LP?

 

[ojfd]

.......

Bruce Kirby lawyers have just raised the stakes again, piling more material into the US Federal Court system after ISAF - ILCA's actions to take Kirby's design rights from him.

....

What I don't understand is why BK keeps byting the hands that fed him all those years.