Dispute regarding Laser Class monopoly
Published on April 26th, 2019
Since the International Laser Class Association (ILCA) terminated the contract with its largest builder, LaserPerformance (LP), the business has been defending its position in the complicated myriad of relationships that exist within the class.
Prior to the termination, the ILCA had three approved builders with specific territories. While Performance Sailcraft Japan (PSJ) and Performance Sailcraft Australia (PSA) covered most of Asia and Australasia, LP had essentially the rest of the world.
Further complicating the situation is the review of singlehanded equipment options for the Paris 2024 Olympics being conducted by World Sailing. As part of that review, World Sailing has asked classes to adopt a FRAND policy which will permit to have several builders even in the same region.
The previous limit on builders, along with specifically defined territories, was an obstacle for the ILCA to remain as Olympic equipment, a status they have held since the Atlanta 1996 Games.
The issue of monopolies has become a hot topic for the Olympic sailing equipment, and it is an issue that LP believes the ILCA has not resolved in their termination. Here is the latest statement by LP:
PSA-owned Global Sailing aim is to create Laser Monopoly and Kill Competition
(April 26, 2019) – ILCA has issued a document that “requires that each builder and sublicensed builder must also have a current license agreement with Designer,” and adds that “the Laser Construction Manual Agreement (LCMA) to include Global Sailing as a party in place of Bruce Kirby.”
Global Sailing and Performance Sailcraft Australia (PSA) have common ownership, hence PSA, which was quoted in ILCA’s 25 April 2019 announcement, that it was “gearing up to maximize production of the newly-branded ILCA Dinghy”, maintains that it also controls the design rights of the Laser.
If this is not the definition of monopoly then what is? Indeed, giving licenses to other entities where the license governs the terms of engagement does not withstand FRAND or monopoly tests either.
ILCA’s management has obviously acceded to this non-competitive strategy and the illegal initiative to change ILCA’s name. Coupled with the ILCA/PSA/PSJ secret alliance to replace the Radial and 4.7 Laser boats with C series rigs, it becomes clear why ILCA refused to meet with LaserPerformance to negotiate a new license agreement in its territories (the world except Australia, New Zealand, Japan and Korea).
It is doubtful that Global Sailing even owns any rights. In June 2008, Bruce Kirby sold his “expired” design rights to Global Sailing. In 2009, Global Sailing informed LaserPerformance that it was the owner of the rights to the Builders Agreements, but subsequently World Sailing informed Global Sailing that the sale was invalid because it did not receive WS approval.
Indeed, in litigation in the USA initiated by Bruce Kirby and Global Sailing, they represented to the US courts that Global Sailing had no such ownership interest.
This is the context in which LaserPerformance is proposing:
• ILCA move back to Europe where the majority of Laser sailors live and sail.
• ILCA appoint a professional executive team to run the class operations paid for by increased plaque fees charged to the builders.