Jordan Launch Damages Claim Against Vodafone

Formula One team boss Eddie Jordan launched a 150 million-pound ($252.5 million) damages claim against mobile phone giants Vodafone in the High Court today.

Jordan claims Vodafone wrongly pulled out of a three-year deal to sponsor his team's cars, only to back rivals Ferrari. The legal claim, which takes into account the 100 million pounds Jordan claims Vodafone agreed to pay as well as interest and other losses, will take three weeks to argue.

It centres on four words that Jordan claims were spoken to him on the telephone in 2001 by Vodafone's global branding director David Haines: 'You've got the deal.'

Jordan Grand Prix Ltd claim that these words sealed the agreement for the three-year sponsorship of their Formula One cars on terms negotiated between the parties in the preceding months, even though no written contract was produced.

"The case in a nutshell raises two questions," Alan Boyle QC said opening the case for Jordan. "One, did David Haines of Vodafone say to Eddie Jordan on March 22, 2001 'You've got the deal'?

"Two, if so, what was the effect of those words - did they bring into existence a contract for the sponsorship of the Jordan Grand Prix racing team by Vodafone on the terms negotiated and agreed between them prior to that date.

"On the first question, our case is that those words were said. We say that the words spoken were words of commitment. There was clear assent on both sides to the existence of a deal between Jordan and Vodafone."

He said that both Jordan and Jordan Grand Prix's commercial director Ian Phillips, who listened to the call, would give evidence that those words were spoken. He added that Phillips, a former journalist, had written them down in his notebook, which was in evidence before the court.

Further Negotiations

Turning to the second question, he said that there was no suggestion in the conversation that it would be necessary to conduct further negotiations, nor was there any suggestion that there had to be a written contract signed by the parties before a deal could come into existence.

"The word deal is a colloquial word, but well understood by businessmen - when they do a deal, they bring into existence a bargain between them, and that is what we say they were doing here. The words were clear and unqualified.

"We say that both sides wanted to commit at once to this deal for good commercial reasons and, had Mr Haines wished to avoid making an immediate binding commitment to the deal, he would not have used the words that he used.

"He would not have said 'You've got the deal' and he would have made it clear that he was not to be taken to be committing Vodafone to any contract at that point. It is very easy to avoid making a contract if you wish to avoid making a contract. Equally, it is very easy to make a contract if you decide you wish to make a contract."

Vodafone claims that it merely entered into negotiations with Jordan, along with rival teams McLaren, Benetton, Ferrari and Toyota, as part of its global branding strategy, which includes sponsorship of Manchester United and a commercial deal with England captain David Beckham.

Jordan, one of three non-manufacturer teams remaining in Formula One after the collapse of Arrows and Prost, are struggling to raise backing this season, while Ferrari are one of the wealthiest teams.

Vodafone announced its deal with Ferrari prior to the Monaco Grand Prix in 2001.

The hearing, before Mr Justice Langley, is expected to last three weeks.