$47M settlement to be paid by AC/Textron

[biffdotorg]

So there is no discussion of the $47,000,000 settlement this week that Arctic Cat/Textron will have to pay out to Speed for breach of contract? This may or may not impact the Yamaha faithful. Other than the fact that the engine supplier agreement applies as much or more to the Wildcat XX machines, and what AC/Textron was supplying to Speed. Prior to Speed developing their own engines.

I know Romano and team used to frequent the Wildcat Forum, so it may or may not be discussed. But I guess it is open for discussion now that it is settled after two weeks in federal court and Romano has posted celebratory photos on Insta. They say they are not done yet with court proceedings against AC/Textron either.

I'm more curious if that dollar amount will impact production and future development. As it's not bankruptcy sized, but not exactly a small dollar amount.

Just curious.

 

[Simon Forest]

Link??

 

[biffdotorg]

 

[Simon Forest]

Strange that there's nothing in the news about this???

 

[sailor joe]

did they collect the money or is it going to appeal...

 

[Phatboyc]

So what is the coles notes on this?

 

[earthling]

Arctic Cat cut a deal with Speed to license a Robby Gordon special limited edition Wildcat which is referred to as the XX (contract signed).
Arctic Cat shows Speed a spreadsheet with potential royalties from sales of the Wildcat XX - they agree that the numbers are realistic ($30M)
Speed delivered a design to Arctic Cat with a 90 day first right of refusal.
Arctic Cat never made a real decision on that first right of refusal, instead stringing Speed along by showing incremental efforts while continuing to build the Wildcat Zeus (or some other non-speed model)


Speed assumed it was going to get built and started marketing it at tradeshows, etc. They even built their own version to market using the Arctic Cat name. Arctic Cat never pushed back on use of their name.

Arctic Cat never built it beyond the prototype stage

Speed sues for breach of contract (among other things)

Arctic Cat countersues for copyright infringement (and files injunction on other things)

Minnesota in particular has a law which states "[T]he implied covenant of good faith and fair dealing governs the partiesʹ performance and prohibits a party from failing to perform for the purpose of thwarting the other partyʹs rights under the contract"

Arctic Cat, by not explicitly refusing the 90 first right of refusal (basically sending a letter or email saying 'we aren't interested') was seen as leading Speed on while quietly developing their own solution.

Jury says 'foul' court awards summary judgement.

That is the cliff notes of the cliff notes as far as I can tell.

 

[Phatboyc]

Ok thanks.

Seems like a big settlement for not much spent by Speed?

 

[earthling]

Ok thanks.

Seems like a big settlement for not much spent by Speed?

Cases like this end up lopsided because its all based on 'potential sales'.

 

[Phatboyc]

Oh so Speed would of made a cut of the sales. Got it.

 

[earthling]

Oh so Speed would of made a cut of the sales. Got it.

I edited the cliff notes to add the reference to royalties on the second line as that does help with understanding where the money was supposed to come from. The actual award was partially based on potential unit sales of Wildcat XX, and partially on sales of associated accessories (never mind that none were never made).