CART FIles Suit After ISL Ends Contract

CART Files Suit After ISL Ends Marketing Deal

Racing group alleges breach of contract, fraud

Detroit, March 8, 2001 -- ISL Worldwide terminated the nine-year marketing deal it signed with CART in 1998. According to Bloomberg News. ISL claims CART “broke an exclusivity clause” and added that ISL “has not ruled out future legal action.” A spokesman for CART said that he was “not aware of ISL’s action” and that CART currently has agreements with FedEx and MCI communications.

CART filed a complaint against ISL in the Oakland, Michigan County Circuit Court seeking damages in excess of $100 million. CART alleges fraudulent inducement, breach of the agreement and failure by ISL to pay more than $6 million due to CART per the agreement. ESPN noted the CART/ISL deal “guarantees a pre-determined amount of income to CART.”

If such a case goes to trial, the focus will be on the scope and nature of the exclusivity clause. If CART violated that clause, then it is likely that ISL could end the agreement and have its duties discharged. In such a case, CART would lose. Conversely, if the contract was improperly terminated, then a breach occurs and the plaintiff would likely prevail.

Marcus Leazer