KEY POINTS:
Team New Zealand have had their first day in court and they look set for many more as their lawsuit against America's Cup holders Alinghi grinds its way through the complex New York State legal system.
A preliminary conference was heard before Judge Pauley in the US Federal
District Court on Saturday to chart the way ahead for the two actions; one seeking damages for breach of contract and the other filed under US anti-trust legislation.
The first oral arguments in the case won't be heard until September 5 and Alinghi general counsel Hamish Ross said the matter was expected to "drag on for years". This means Team New Zealand could conceivably still be tied up in litigation by the time the next multi-challenger event rolls around.
Alinghi, headed by pharmaceuticals billionaire Ernesto Bertarelli, have also been embroiled in a legal dispute with Oracle since last August.
That action continues to rumble on, with Alinghi launching countless appeals, but Ross said the developments have been "extremely quick" compared to what Team New Zealand can expect.
He said the New York State system is not only complex, but also the most expensive in the world.
"The legal action currently in place between Alinghi and Oracle is on an expedited system and it's been extremely quick. This particular action is not on an expedited system, nor will it ever be," said Ross.
"Because it's going to drag on for years costing millions, people are sort of scratching their heads wondering why Team New Zealand is diverting itself from trying to win the America's Cup by chasing a billionaire in a very expensive jurisdiction."
Team New Zealand's case is built on two fronts:
* First, they have filed an anti-trust suit on the belief that Alinghi have operated in abuse of their monopoly position.
* And secondly, that the Swiss syndicate has breached a pre-entry agreement between themselves and Team New Zealand to stage an America's Cup event in 2009.
They are seeking US$37 million ($48.52 million) in compensation if the regatta is delayed until 2010 and US$50 million if it is pushed back to 2011.
Team New Zealand had filed one action in the State Court, the other in the Federal Court, but Alinghi were successful in having the two matters combined and heard as one. The Swiss have filed further motions to have the dispute heard by an America's Cup arbitration panel.
They argue that once Team New Zealand entered the 33rd America's Cup, they came under the jurisdiction of the arbitration panel set up for that event. Team New Zealand's lawyers are trying to split the two issues again and get the breach of contract case sent back to the State Court.
The Swiss also claim that Team NZ entered the event in the full knowledge that legal action was underway by Oracle at the time of their entry in July 2007.
"They signed an entry form which clearly acknowledged Oracle's legal actions were taking place at the time, they were fully aware of what could potentially happen, and any action they took was with their eyes wide open," said Ross.
Of the anti-trust allegations Ross said: "I think that's an extremely novel claim, and we believe it has no merit whatsoever."
A resolution of the Oracle-Alinghi court action of where and when a head-to-head challenge will be held is expected by the end of the month.
* WHAT'S AHEAD
Timeline for Team New Zealand action:
July 3: Alinghi file motion to compel arbitration.
July 31: Team NZ file response to motion.
August 7: Alinghi file final reply.