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Paris, 13 September 2007 1

Extraordinary Meeting of

the World Motor Sport Council

I. Hearing

1. Preliminary Points

Max MOSLEY

At my request, Sebastian has gone to each of the two teams – McLaren and Ferrari – and explained

that, because the dossier arrived very late last night, the World Motor Sport Council needed to take

a bit more time to read it before we open the hearing. I am not sure that everyone has read it.

There is a great deal in it that may not be directly relevant, and it is not as bulky as it looks.

Nevertheless, I feel you should be given more time. If you wish to take this time to have a quiet

look at your dossier, this would be a good opportunity to do so.

President of the World Karting Federation

I wished to point out a possible error in the first dossier, page 134. Regarding the telephone

discussion, Jonathan Neale is the name that is listed for each of the witness responses on that page.

If I recall correctly, it was Paddy Lowe who stated all of this, not Jonathan Neale.

Max MOSLEY

Thank you very much; we will take that on board.

Are there any other points that people wish to raise on the dossiers?

[After 20 minutes time, Max Mosley asks whether there are questions or requests for additional

time. As none are put forward, the teams are called in.].

For clarity’s sake, we ask that any teams other than McLaren and Ferrari please sit at the end,

where they will be comfortable. Witnesses, other than the expert witnesses, will be asked to sit

outside, as we do not have room to seat them all. In any case, it is preferable that witnesses not be

present during the proceedings. Three seats have been provided for McLaren and three for Ferrari.

We are trying to accommodate everyone as best possible.

[It is ascertained that all of the witnesses other than expert witnesses are outside. Paddy Lowe

being deemed by Max Mosley a witness of fact in this circumstance, he is also asked to wait

outside.]

I apologise that it was rather difficult to accommodate all those requiring seating in this room.

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 2

We sent out a note in an attempt to limit the amount of time spent in an actual hearing today,

particularly in view of the large quantity of documents being circulated. I hope that we will be able

to abide by that schedule.

We thought that the best way of proceeding was to allow to Ferrari to present its case, as we were

criticised last time for allegedly failing to allow Ferrari the proper opportunity to do so. Thus, after

preliminary matter, we will allow Ferrari to present its case for a maximum of 45 minutes.

McLaren will then have 1 hour and 30 minutes to present its position. It would be most efficient if

the actual submissions were very short so that more time could be dedicated to asking questions

and listening to witnesses. However, it is up to each party how it wishes to allot time for questions

and, perhaps, other people’s witnesses.

I should also say that it is our intention – because it has been suggested in the press that these

proceedings are less than fair or that we are in some way published – a full transcript of both

hearings, (26 July and 13 September) having first given the parties the opportunity to redact from

those transcripts anything that they feel is confidential, or for which they can give genuine reason

for not publishing them. It is in the interest of motor sport and Formula 1 that people can

understand what took place and form their own opinion as to what happened. We hope to circulate

a transcript within 24 hours, then leave you 48 hours to make whatever redactions are deemed

appropriate.

I should add that, if there is any question of imposing any sort of penalty at the close of the hearing,

we will invite the parties back to make submissions on that, particularly the affected party. This is

fundamental. We will also invite Lewis Hamilton’s counsel, should there be any decision that

might affect him, so that we can hear submissions on his behalf. That concludes the preliminary

points, on my part.

Ian MILL

I have two points.

The first is a matter that we did raise in our skeleton submissions: it concerns the Italian documents,

if I may refer to them as such, which you have received and which form part of the evidence

against us. You will have read in our submissions that we have concerns that those documents may

have obtained improperly. We have present, in the room, if deemed helpful and relevant, our

Italian lawyer, Professor Amodio, who can explain the issues to you. He has been responsible for

drafting the Italian proceedings which are in our dossier papers. It may be that this is all a

misunderstanding, but as the President wrote to us when we received these documents, he had

understood that the reason for their arrival, at the time of their arrival, was that Ferrari had to obtain

a court order to allow them to be disclosed. Please understand what these are: these are documents

from the confidential files of the police, in relation to the potential prosecution of Mr Coughlan and

Mr Stepney. If they are used today, they will be so for a purpose entirely unconnected from that.

Professor Amodio, who is a witness of fact for these purposes, states that he spoke to the

prosecutor. The prosecutor told him that Ferrari had indeed applied to him for permission, and that

he refused it. We have written to Ferrari for a copy of the court order, for it is entirely possible that

we have misunderstood the position or that the prosecutor had misremembered events. As I far as

we know, we have yet to receive a response from Ferrari on that. It is very important that, before

hearing Ferrari’s case, insofar as they are going to rely on those documents, that a substantive

response be given: if they have obtained a court order, they should assure us of that and, if they

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 3

have, preferably produce it. In that case, we can forget about this and move forward. Otherwise,

the World Motor Sport Council needs to understand that that there may be issues on which my

clients have to reserve their rights, insofar as they regard and are based upon documents improperly

obtained.

Max MOSLEY

In front of us is a list of 323 text messages and telephone calls – a combination of the two – over a

3.5 month period. The World Council’s only concern is whether that list is accurate and truthful.

We are not concerned with whether there are issues over how that is obtained. Unless there is

evidence that it is forged or inaccurate, we will take it on its face value. We do not enter a debate

about Italian law; we have neither the time nor the skills for that. We have a list, we will look at it

and you can make whatever points you wish to make about it.

Ian MILL

I understand that that is the position that the World Motor Sport Council has taken. It has to

understand that the fact that it is looking at the list, and being invited by Ferrari to draw inferences

from that list may create serious problems. However, if that is how the World Motor Sport Council

wishes to deal with this, then that is fine. You simply need to know that we reserve our rights with

regard to that.

Max MOSLEY

Absolutely; that is understood. What was your second point?

Ian MILL

The second was raised just now by Mr Dennis, who was concerned, upon coming into the room, a

gentleman whom he believes is or has been a director of Ferrari: Mr Piccinini. He was concerned

as to whether that gentleman intended to play any substantive part in the proceedings and have an

impingement on the result.

Max MOSLEY

You are quite right to make the point. He is indeed a director and was, many years ago, the Ferrari

Team Manager. He will not play a part in the proceedings and will not vote. However, as he is the

Deputy President of Motor Sport for the FIA, it seemed entirely appropriate that he should be here.

Ian MILL

That seems entirely appropriate. I had thought that would be the answer.

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 4

Max MOSLEY

If you are ready, the floor is Ferrari’s.

2. Counsel Statements

Henry PETER

Mr President, Ferrari will be represented today by Nigel Tozzi, an English QC and myself.

Ferrari’s case has been presented in detail in a submission filed on Tuesday, with 64 documents.

Two of these documents are highly confidential and are thus only with the World Motor Sport

Council: the three exhibit to Mr Procogenta’s affidavit; as well as two binders containing the 780

pages of material founded at Mr Coughlan’s domicile. It is only by seeing and weighing it that one

fully realises what is in question.

Max MOSLEY

Might I interrupt you. We are happy to have these documents shown quickly to the members of the

World Council, but it is up to you to decide when that will happen.

Henry PETER

Thank you. As requested by the FIA, Ferrari also filed, before noon, a six-page skeleton in both

French and English. We assume that this has been read and the case will therefore be presented

quite briefly, at this stage.

I will do this and Nigel Tozzi will then carry on, developing some of our points.

Relying on the facts known at that time, on 26 July 2007, the World Motor Sport Council found

that McLaren had breached Article 151c of the International Sporting Code. The WMSC, however,

decided that evidence of any use of the material found in possession of McLaren was insufficient to

impose a penalty. The Council, however, reserved the right to invite McLaren back in front of it in

case new evidence emerged.

Since July 26th, new facts have indeed emerged. First, they show that McLaren has not told the

full story, thus the WC was misled when it issued its first decision. Secondly, new and impressive

evidence has now been collected, which shows that a substantial amount of additional confidential

Ferrari information penetrated McLaren at advanced levels and was used in various manners.

These facts results from documents collected by the FIA. We refer to the e-mails exchanged by

Alonso, De la Rosa, Coughlan, Lowe and Stepney and by Ferrari. I am referring here to reports

obtained – legally – by Ferrari, collected and prepared by the Italian police, with evidence that

hundreds of SMS –

Max MOSLEY

Can I interrupt you? We know all of this. We need to hear information that is not contained in the

documents, or hear the witnesses. There is very little new evidence and we are familiar with it.

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 5

Henry PETER

Fine. I would like to recall that, if this illegal possession used by McLaren had not been discovered

by chance, McLaren would probably still be using it today. Furthermore, if the FIA had not written

to McLaren’s drivers, we would not be here today. In all of this process, McLaren never

contributed to discovering the truth, at least not spontaneously.

We believe that McLaren derived substantial advantage from the knowledge and use of the

material. We know that, with so little between McLaren and Ferrari, the slightest adjustments can

make a major difference in terms of results. In view of these facts and this new evidence, we trust

that the World Motor Sport Council will be able to make the appropriate decision today.

Nigel TOZZI

We started receiving McLaren’s documents at 4 PM yesterday; we did not receive the detailed

submissions until after 6 PM. We are thus unable to respond in detail. We are very conscious of

the time constraints for today’s hearing. It is important to understand, then, that any failure to deal

with a point in McLaren’s submissions as an acceptance of its truth, but simply a reflection of the

time available to us.

The McLaren submissions and witness statements a number of completely unfounded criticisms of

Ferrari, presumably in an attempt to deflect attention from their own conduct. We urge you to bear

in mind that we are here to consider McLaren’s conduct, not that of Ferrari, and indeed not that of

Renault, which also seemed to bear the brunt of some criticism from McLaren. We are here to

consider McLaren’s conduct. That is the ambit of this enquiry.

The third point is to remind you of the language of Article 151c itself, and the fact that you have

already found McLaren, and rightly so, to be in breach of that Article. Article 151c makes it an

offence where there is any fraudulent conduct or any act prejudicial to the outcome of a

competition, or to the interest of motor sport in general. There is no requirement in Article 151 that

it must be shown that a party needs to have gained advantage or that documents have actually been

used, as in this case. If I may provide analogies from another sporting arenas. In athletics, if a

runner takes a banned substance, that runner is disqualified; it is not necessary to show that the

runner has gained an advantage. It is enough that he has taken a banned substance. If a football

team fields a player who has been banned, it will be disqualified or lose points. It is not necessary

to show that the said player had any influence on the outcome of the match.

Max MOSLEY

Mr Tozzi, may I interrupt you for one second. I do not wish to keep interrupting. The point you

are making is fundamental to motor sport. Someone can be 1mm over with their wing, or half a

kilo over or under with their weight, and thereby be disqualified. We have exactly that principle.

Last time, the World Motor Council was motivated last time by the fact that all of the information

was reported to us to be in the hands of a rogue employee. We were told that none of the

information had reached anyone in McLaren. Under those circumstances, it seemed to us unfair to

impose the same sort of penalties as those that would have been imposed had .in McLaren. It was a

question of fairness, not a rigid application of the rule. The principle you are explaining is one that

we fully understand and follow. However, the particular circumstances on the 26th were that we did

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 6

not have sufficient evidence to rebut the assurance that none of the information has found its way

into McLaren.

The real issue is as follows: were the 780 pages disseminated into McLaren, to any degree?

Secondly, does the new evidence add anything in arriving at that answer?

Nigel TOZZI

I understand and will not belabour the point I was making. I understand the boundaries, but that

does not indicate that I accept that you are so prescribed.

The key facts for you to consider are, in light of the new evidence:

- The degree of contact which we now know to have taken place between Coughlan and

Stepney. I will not respond in any detail when my learned friend raised his objection to the

manner in which the information was used in the Italian prosecution. We say that objection

is extraordinary from a party that has come before this body on several occasions, claiming

a desire to be helpful, cooperative, and open. It is extraordinary that they are trying to

suppress that information’s being in front of you, even to the extent of taking materials from

proceedings in Italy and having that withdrawn.

- We completely reject the suggestion that we have, in any way, behaved improperly in using

that material. Our Italian lawyer, Mr Deluca, is here to provide counsel on that. It may be

taken to say that we have a complete answer to all of the points made by McLaren, which

are misconceived, quite possibly because they do not understand the full position.

- Thirdly, I would pick up on the suggestion of cherry-picking. If the FIA wants us to give all

of the material to McLaren which we are allowed to give, then we are perfectly happy to do

so. It was not a question of cherry-picking, choosing material that was advantageous to our

case, whilst keeping that material that might have assisted theirs. Simply, a lot of material

that is quite irrelevant. We are happy for them to see any additional material that we are

allowed to show them.

More importantly, what does the new material show? You will have received with your papers, as

Exhibit 61bis, showing exactly what the nature, timing and extent of these calls were, at different

periods. I invite you, if you have not already done so, to look at that graph. There are a series of

graphs.

Max MOSLEY

Apparently, the document is confidential and has not been circulated.

Henry PETER

It is not confidential, it is has been circulated and is our document, Exhibit 61bis.

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 7

Nigel TOZZI

This combines the material from Aligarto 9 with that in Aligarto 18.

Max MOSLEY

We all have it.

Nigel TOZZI

The graph seeks to show, in pictorial and colour format, detail from the SMS messages, from Mr

Stepney to Mr Coughlan, and the replies from Mr Coughlan to Mr Stepney, as well as the telephone

calls. We know that, from 11 March to 3 July, 288 text messages were exchanged, and 35

telephone calls took place. The graph shows that the contact increased in: the period leading up to

the Australian Grand Prix; during private tests carried out by Ferrari in Malaysia, leading up to and

during the Malaysian Grand Prix; leading up to and during the Bahrain Grand Prix; and leading up

to and during the Spanish Grand Prix.

This is not the whole picture. These simply reflect the details that the Italian police have obtained,

by looking at two of Stepney’s phones. One covers only the period 21 March to 3 July, hence ten

days are missing in this graph; the other covers only 11 March to 14 April. Anything on the latter

phone is not reflected in this graph. This is still only a part of the overall picture, then.

Regrettably, we do not have the texts of the SMS messages, despite our very best efforts to do so.

As far as I am aware, the police does not either.

What conclusion can we draw from this? Mr Mill, speaking before you on 26 July, stated that:

“inferences are always open to be drawn in appropriate circumstances”. This is such a

circumstance. The obvious inference was that Stepney was feeding confidential information about

Ferrari and the Ferrari car to Coughlan. It demonstrates that the story that Coughlan told, of only

limited contact with Stepney, was completely untrue.

What was the content of that contact? Unfortunately, it is unknown and we must draw inferences.

However, we are assisted by a document not before you at the previous occasion: an e-mail that

Coughlan has disclosed in a further affidavit, in the English proceedings. That document is found

in Exhibit 57 of our bundle.

Max MOSLEY

Would it be possible for you to read it?

Nigel TOZZI

This is an e-mail dated 14 March, from Stepney to Coughlan. The subject is “drag”.

“Mike, apart from the rear wing, I don’t think this is the whole story. Once the front floor

compresses, when it makes contact with the ground, which is around the 200km per hour to full

compression,, the drag reduces quite considerably, due to reduction of air beneath the car. At the

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 8

same time, the turning vanes also move. The front floor is about 100 cm long, so it is quite an

effective device, also as mentioned in my previous e-mail, as a mass damper, because it helps in

this mode to control the arrow and keep the front tyre contact patch. Other areas we look at are

rear stall, but this is difficult to control. Another solution has been found, which I’ll talk to you

some other time. Regards, Nigel.”

What does that e-mail tell you that you did not know before? It is quite clearly part of a sequence

of information exchange. He refers to an earlier e-mail in which he has passed information. He

refers, at the end, to the intention to tell him further details about another solution, presumably

another solution that Ferrari has found. Secondly, it plainly has nothing to do with so-called

whistleblowing. The utterly discredited argument that McLaren ran before you on the last occasion

to justify the admitted use of Ferrari confidential information, in order to make a complaint to the

FIA. This demonstrates, quite clearly, that the flow of information from Stepney to Coughlan was

a revelation of Ferrari’s confidential secrets. In that this is part of a flow, one going on at the dates

we saw, you can and should draw your own conclusions as to why Stepney should be funnelling

this information to Coughlan, and whether it is realistic that he should have kept that information to

himself.

As to the information being used, I have already mentioned whistleblowing, though I suggest that it

was no such thing and, rather, part of a stream of information. In any case, one does not whistleblow

to the employer’s major competitor. If any whistle-blowing was to be done, Mr Stepney

should have been sending details to the FIA. So far as we are aware, he did not provide the sort of

detailed information to the FIA which he chose to give Coughlan and, thereby, McLaren.

Secondly – and this brings us to the major piece of evidence that has come to light since the last

hearing – the e-mails disclosed by Pedro de la Rosa and Fernando Alonso show that, contrary to

what you were told on the last occasion, the information which Coughlan was receiving from

Stepney was being shared within McLaren. McLaren has tried very hard to suggest that the

information being disclosed was limited to only the two drivers, that there was no wider

dissemination within McLaren, and that we have jumped to a series of inappropriate, unfounded

conclusions. We ask you to use your common sense, stand back, look at what the e-mails actually

say and compare them with what the McLaren witnesses try to say to explain them. Ask

yourselves, “Does that ring true?” We suggest that, when you ask yourselves those questions, you

will come to the only conclusion that you can: that you are being fed a line that is not the complete

story. Moreover, this puts into context what you were told on the last occasion about, for instance:

the installation of the firewall, Coughlan’s extraordinary trip to Barcelona to tell someone to stop

contacting him, and the incredible account of the meeting between Coughlan and Neale, when

Coughlan tried to give him a document and Neale, quite deliberately, turned a blind eye.

The further documents that have come to light are found in the FIA dossiers at Tab 5. First, could

you turn to Page 61? This shows a very short e-mail dated 21 March, from Pedro de la Rosa to

Mike Coughlan: “Hi Mike, do you know the red car’s weight distribution? It would be important

for us to know so that we could try it in the simulator.”

Why does de la Rosa ask Coughlan? We would suggest that it is because he knows that Coughlan

has a link into Ferrari via Stepney. Why does he want that information? You see what he has said

in his statement. But look at what he explains in his e-mail: “So that we can try it in the

simulator”. This is not curious interest, as he attempts to portray it in his witness statements. He

wants it in order to copy it in the simulator, in his own words.

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 9

I ask now that you turn to the next e-mail in the sequence. On page 52 of the English proceedings.

It is an e-mail dated 25 March 2007, sent at 01:43. De la Rosa reports to Alonso on results which

he has following the experiment in the simulator. In the versions we have, there has been a certain

amount of redaction, or blocking-out of text. Consequently, one must work out what is actually

said. Item 1 is about a variable brake balance system. This is important because, as you know –

and we have drawn this to your attention on several occasions – one of the aspects that interested

Coughlan in particular was the Ferrari brake balance system, an innovative and unique design. In

his own, discredited affidavit, Coughlan admitted asking Stepney about it on no less than four

occasions. We know also that he came back with a sketch, which he showed Taylor. Here, we see

an exchange of e-mails demonstrating that McLaren is very interested in the design of a similar

system. For those of you who are entitled to view the e-mail with all of the words left in, I invited

you do so. Regardless, in the e-mail, Mr de la Rosa is saying that, “with the information that we

have, we believe Ferrari has a similar system: they have three positions which they change from

the cockpit.” He also describes, saying: they have “A”. (In our version, the text has been blanked

out, but in de la Rosa’s version, he tells you what they are.) He says, “that was phrase which I did

not understand, something that Coughlan had told me three days earlier, which I had memorised.”

Please think about whether this sounds very credible. He says, “They have this system which

delays the rear-braking initially then proceeds to increase it gradually.” This is not an e-mail from

a man who has not understood what he has been told. “We get the same results using a valve.” In

other words, he clearly does understand what he has been told.

On Item 2, the flexible rear wing he says, “this is also a copy of the system we think Ferrari uses.

It is another two- to three-tenths of a second quicker”. Then Item 5: “information from Ferrari,

their weight distribution in Australia was ‘…’”, giving very precise details.

Max MOSLEY

Not to interrupt, but in the next paragraph of the e-mail, he states that, “it will take them a few

weeks or a month or two to have it”. That would suggest that, perhaps, the intention is to make the

same device.

Nigel TOZZI

Exactly. I agree with you.

Then there is reference to very detailed information, which De la Rosa admits having received from

Coughlan: the car’s aerobalance, and the use of an alternative to air to inflate the tyres. Here, he

comments, “We use nitrogen; we’ll have to try it, it’s easy!” They are clearly using that

information with a view toward copying it.

Alonso’s reply in relation to the brake balance is: “I hope you can try this out. I don’t know

whether it is ready". He is keen for it to be tried it. The next passage that has been blanked out,

allegedly on grounds of confidentiality. However, because we saw this before it was blanked out,

we know what it said, cannot erase it from our memories, and we have referred to it in our

submissions. I do not accept that this is in any way confidential. If you do see it, you will see what

I say that.

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 10

On Item 2, the rear wing, he says, “Let’s hope this only takes one month”, indicating that he wants

this process to speed up. On Item 5, he comments in terms about the weight distribution and what

this draws attention to. “It is very important to test the [blank], since in the race, they have

something different from the rest.” You can read this for yourselves.”

De la Rosa comes back, saying: “all of the information from Ferrari is very reliable. It comes from

Nigel Stepney, their former chief mechanic. I don’t know what post he holds now. He is the same

person who told us in Australia that Kimi was stopping in Lap 18. He is very friendly with Mike

Coughlan, our chief designer, and he told him that.” He refers to something being ready for testing

on Tuesday, then says, “I agree 100%, we must test the [blank] very soon.”

You are being told that this was being passed only between the drivers and that none of this

information was shared with any of the engineers. Alonso is saying that “we must test this!”. Yet

you are asking to believe that because de la Rosa subsequently had a conversation with someone

from Bridgestone who said that this does not always work, that the entire idea was dropped. Does

this sound credible? We say it does not.

Going back to the e-mail and the information about Kimi stopping in Lap 18, there is a lame

attempt to suggest that this is not reliable, because he actually stopped in Lap 19. As you will all

know, the difference between Laps 18 and 19 may arise simply because you have enough petrol to

eke into the next lap. The key point is that Coughlan was being fed information about Ferrari’s

race plans, which he passed on to the drivers. Did the drivers keep that information to themselves?

Do you really think they would? Use your common sense. Use your knowledge of the sport. We

say you should draw some obvious conclusions.

Let me take you forward in the bundle, to page 62. This very interesting sequence of e-mails starts

with de la Rosa pressing Coughlan for details of the Ferrari braking system: “Can you explain me

as much you can Ferrari’s braking system? What are they doing?” Coughlan initially says, “it

may be difficult for you to understand”. Yet De la Rosa presses him for the information, saying,

“Fernando wants to know”. Eventually, Coughlan gives him a very detailed description of our

braking system. He must have and can only have gotten that from Stepney. You are being told by

de la Rosa that, because he did not understand it, he did not share that information with anyone.

Again, use your common sense: does his sound very credible? Here is Coughlan, disseminating

information. Bear in mind that Coughlan had said, in his affidavits, that apart from the whistleblowing,

he had no other contact with Stepney and that he had not shared this information with

anyone from McLaren. You now see a very different picture emerging.

Why does this picture emerge? Because the drivers blew the whistle, making for a very interesting

story in itself. When Alonso raised the existence of documentation on 5th August with Mr Dennis,

obviously in the context of some dispute, he mentioned the matter to your President, but did he try

to get to the bottom of it? Did he say, “If you have documents, I must have them, because I am

under duty to the FIA to take them back to the World Motor Sport Council.” No, he did not. We

received this information only because the FIA wrote to the drivers, telling them that they were

under duty to disclose. It was not been volunteered by McLaren. That tells you a great deal about

the internal investigations carried out by McLaren and their enthusiasm to volunteer information.

We therefore say: look at the facts; don’t listen to the assertions. The facts are that this is

information that FIA secured from the drivers. It did not result from an internal investigation by

McLaren.

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 11

How does this fit in with the rest of the facts? According to Coughlan, we know that he spoke to

Stepney on four occasions about the brake balance and was given a drawing, which he showed to

Taylor. Mr Taylor seeks to suggest that this was nothing to him. An engineer of Mr Taylor’s

experience would instantly have known that he was being shown provided a significant

improvement in functionality. We have included evidence from Professor Genter explaining this to

you in some detail. In McLaren’s submission (the lengthy document), more is told about what was

happening in the McLaren camp. I ask that you turn to page 6 of their submissions, at Paragraph

15. It starts on page 5; I will pick up the story on page 6. “McLaren’s novel system” – purportedly

their own – is described in the following terms: “From mid-February 2007, based on an idea of Mr

Lowe, McLaren developed a novel and completely different system for achieving variation of the

relative braking mode on the front and rear axels. They say that McLaren’s system was tested on

22 and 29 March, and introduced at the Spanish Grand Prix on 13 May. It was inspected and

approved by Mr Whiting”, who is then quoted. “In the first Grand Prix, McLaren observed that

Ferrari was using lever, which it believed was likely to be part of a quick-shift system.”

Immediately after the Grand Prix, Mr Lowe instructed a team of vehicle dynamics specialists to

study footage – in effect, ordering a spying exercise to see hat Ferrari has. He says that, “Coughlan

was not involved this study. The team confirmed that this appeared to be part of a quick-shift

system.” Then, it is said that, “since some engineering resource had become free, Lowe asked

Coughlan to release an engineer to him to produce 2007 version. Coughlan released Chris Lewis

to this task. Lewis quickly designed such a system.” They add that the evidence of Lowe and

Lewis shows that this was designed entirely independently, based on McLaren’s 2001-2002 design.

If you turn to the statement of Mr Lewis, which we received yesterday, it says that: “In early April

2007” – the dates are important, bearing in mind the e-mails we have just seen – “Mike [Coughlan]

asked me to begin work to design a quick-shift brake balance adjustment system, not a particularly

difficult task, as McLaren had used a quick-shift system before, in 2001 and 2002. My work

mainly involved taking the knowledge that we already had about quick-shift systems and optimising

it for use on the 2007 McLaren car”. He exhibits a document that we have not seen. He then

confirms what Mr Lowe has said to you in a document we have not seen is correct. In particular,

he states that, “For the purposes of the quick-shift project, I reported to Mike directly, without the

involvement of my team leader, while Mike supervised the project. His involvement was no more

than the general supervision and direction he gives to all drawing projects. For example, Mike

outlined the idea that I import that 2001-2002 design into the 2007 car. I looked at that previous

design and brought it into a CAD scheme, with changes necessary for it to fit the 2007 car. Mike

and I and Pat Frye reviewer this scheme and agreed the final details. I completed the detailed

design and component drawings, which Mike approved for manufacturing.”

Here is someone reporting directly to Mike Coughlan, working on a brake-balance system. At the

same time, you have hard evidence that Coughlan is pestering Stepney for details of the Ferrari

system and exchanging that information with at least De la Rosa at exactly that time. Yet you are

being asked to accept that he did not contribute any ideas that he might have obtained from Ferrari

to the development of the McLaren system. The McLaren system may be different; of course it is,

for it was designed by different people.

We submit that the idea that Coughlan did not use any of the information he had obtained

illegitimately from Ferrari to contribute to the development of that design is so fanciful that you

should not accept it. More to the point, the people who will come along and testify the “he did not

give us any confidential information” probably don’t know. If Coughlan simply says, “have you

tried this?” or “have you thought about that?”, they are not to know that he has that idea because it

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 12

has been purloined by Stepney from Ferrari. They see it as Coughlan contributing to the discussion.

And we suggest that the fact that he is sitting on the information and pressing Stepney for details is

the clearest indication of use, or perhaps only attempted use of Ferrari’s documentation and

information. It is certainly enough for you to conclude, gentlemen, that something has to be done.

Of further interest is Mr Taylor, with whom Mr Coughlan also seeks to discuss this on the first

working day following his trip to Barcelona. He goes to him with the drawing, asking what he

thinks about it. This is part of that bigger picture that we suggest you consider. We say that there

is something odd about the fact that, in Australia, the Ferrari cars were so much better than the

McLaren cars. Yet, as you all know, McLaren has caught up. Gentlemen, if you wish to ask about

technical details, we have witnesses present. Mr Braun, in particular, will be able to deal with any

technical inquiries you may have.

Might I also remind you of something that Mr Neale said in a relatively recent press interview? It

touches upon the issue of use, what can be relied upon, etc. In the 11-12 August issue of the

Financial Times Magazine, Mr Neale stated, referring to the McLaren car: “There isn’t much on

the car that stays the same; maybe the seatbelts don’t change. From the moment the car is formed

in January to the last race in October, we make an engineering change on average every twenty

minutes. We started behind Ferrari, but what determines how the season progresses is how quickly

you can change the car.”

You will be bombarded with technical information from Paddy Lowe, saying that he knows the

DNA of every change and can tell you exactly its origin. With the greatest respect, whatever the

document you are shown and we are not, I doubt that he will be able to detail with every change

made every 20 minutes. The gap in Formula 1 is so tight that, as Dr Braun says, you can win or

lose a race by a matter of one-tenth of a second. Top teams invest hundreds of millions of dollars

to gain a technical advantage. Possession of a portfolio of information by someone as experienced

as Mr Coughlan would be worth several tenths of a second. Coughlan is a designer with 15 to 20

years of experience. He is employed on a significant salary by McLaren. He is more than the

Office Manager suggested by McLaren.

Max MOSLEY

Mr Tozzi, I do not mean to be annoying, but we are nearing the 45-minute mark.

Nigel TOZZI

I have my watch here and am quite aware of that.

The content of the e-mails is wholly-inconsistent with what you were told by McLaren at the last

occasion, where they claimed to have carried out a thorough investigation. Either it was thorough

and information was suppressed until Alonso blew the whistle, or it was not thorough, in which

case you cannot place any trust in assertions such as those made on the last occasion and which are

almost certain to be repeated on this occasion. In the context of what you now know, you must

look at the other evidence. I have already mentioned the firewall, the trip to Barcelona and the

meeting with Mr Neale. In view of the time, I will not develop those submissions. In our written

submissions, we do say that the explanations offered are fantastic, simply unbelievable and should

not be accepted, particularly in the light of the further information.

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 13

We have reached a position where we know that members of the McLaren design team were

involved: Mr Coughlan certainly, as well as Mr Taylor and, possibly Mr Lowe. We know that the

Management is involved. Whatever they may say, Mr Neale quite obviously turned a blind eye to

the documents shown to him by Mr Coughlan, knowing that he had extensive contact with Stepney

and had been receiving confidential information from him. We know that the drivers are involved,

Pedro De la Rosa and Alonso both knew that Coughlan was receiving information from Stepney.

Designers, management, drivers: how many people in McLaren need to be involved before it can be

concluded that there was not only one “bad apple”, and that there is systematic failure throughout

McLaren to behave in a proper way. The conclusions we invite you to draw are listed in Paragraph

30 of our skeleton argument. I will not read them out. We do submit, bearing in mind Article 151,

that it is important that the World Motor Sport Council does something now to restore the

reputation of Formula 1 and not allow the sport to become and anarchic free-for-all.

I think I have managed to stick to my 45 minutes.

Max MOSLEY

Mr Mill, it is your turn.

Ian MILL

Gentlemen, could I start with the following central propositions:

1) The McLaren 2007 car is and the 2008 car will be 100% the product of McLaren

technology, know-how, skill and endeavour.

2) No part of either car contains or will contain any element of Ferrari confidential information

.

3) No use of Ferrari confidential information has been made, is being made or will be made, in

the design or development of either McLaren car.

With regard to these central points, we offer the following general observations by way of opening:

1) Firstly, Ferrari is unable to point to any component part which it is able to establish as

having been used by McLaren on its car. It is absolutely obvious that, over and above that

what you have seen from Ferrari and hear from it today, every step imaginable has been

taken to try to establish this. We know what sorts of steps are taken. We know what is

done in the Formula 1 world, legitimately as Mr Tozzi rightly accepts: observation,

photography, listening to transmissions, watching onboard footage, etc. I and you,

certainly, have no doubt that Ferrari has pored over every piece of information that it can

find on the McLaren car between April and today’s date. Yet there is not a single allegation

on the basis of that. The reason for this is that none can be made.

2) Ferrari is unable to make any more than a wholly-generalised assertion, backed up by

nothing more than unjustified surmise and inference that use has been made.

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 14

3) The FIA does not point to any part of the McLaren car, which involves the use of Ferrari

confidential information. The FIA has had, from the outset, an open invitation as stated last

time and since repeated, to visit the McLaren premises, inspect the McLaren car, look at

McLaren records (including test records), to satisfy itself whether any use has been made.

That offer is repeated and has not been taken up. If the FIA had any genuine basis for

concern in this respect it would have taken up the offer.

4) McLaren has provided and, if you have not had the opportunity to read the documents,

compelling, clear and unequivocal evidence that no Ferrari confidential information has

been used. You have before you the very detailed, confidential statement by Mr Lowe,

attached to which is a signed statement from all of McLaren’s engineers, except the five

away on holiday and uncontactable. Every other McLaren engineer has come forward and

put their names on the document.

This case, therefore, is not one about McLaren using Ferrari confidential information in its car this

year or next. There simply is not a case to be made on that. Therefore, no question of any

substantial sanction against McLaren can arise.

What is this case about? Let us briefly recall what happened last time: we were summoned on short

notice to answer a wholly-ungeneralised charge of possession of Ferrari documents. We were

informed of the charge on 12 July, and did our best on the time available to answer it. A hearing

was held precisely two weeks later. I do not need to reiterate what occurred on that occasion. You

were there, recall it and have had the opportunity, if you needed it, to view the transcript to remind

you further. The allegations related to a dossier provided by Mr Stepney to Mr Coughlan in

Barcelona and also, possibly, the disclosure to the FIA of allegedly illegal elements of the Ferrari

car. We told you then what investigations we had carried out, we told you that we had spoken to

the engineers, putting forward the evidence of Mr Lowe and Mr Taylor. We spoke to the

Management, and put forth the evidence of Mr Neale and Mr Dennis. We instructed leading

computer experts to trawl through the computers of Mr Coughlan and McLaren. We gave Ferrari

access to do the same thing. Neither found any material document.

Nothing before you on 26 July suggested further avenues of inquiry or identified other parties about

whom McLaren should have come forward. In particular, nothing on that occasion was available to

us that we needed to make inquiries of our drivers: the FIA had not identified any material making

that appropriate, nor had Ferrari, and Mr Coughlan had certainly not told us anything about that.

We had his affidavit in the same way that you do. We put forth evidence on that occasion, which

was and remains true. The dossier was kept by Mr Coughlan in his home. No one had knowledge

of its existence. The disclosure that we knew about in March was legitimate whistleblowing. Since

that last hearing, we submit that nothing has merged calling into question McLaren’s evidence on

these matters.

There have, however, been two developments. First, the drivers came forward with information, as

a result of a letter form the President, showing that Mr Coughlan had given certain information to

Mr de la Rosa, which Mr Coughlan said he had obtained from Mr Stepney. This happened last

week. It is right to point out the background against which this occurred. Somehow, Ferrari wishes

to make criticism or point on it. Quite to the contrary: it shows McLaren in a completely proper and

straightforward light. Mr Dennis volunteered to Mr Mosley, at the time of the Hungarian Grand

Prix, that one of his drivers had told him that he had received Ferrari information from a McLaren

engineer. He then also told Max Mosley –

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 15

Max MOSLEY

I am sorry. First of all, I do not recall that being in Mr Dennis’ statement. Secondly, it is

completely untrue: he did not say that he received the information from an engineer. He told me

that he had information that was damaging, which he was prepared to give to the federation. He

did not say it came from an engineer.

Ian MILL

If I have mischaracterised Mr Dennis’ evidence, I apologise. I was not intending to engage in

evidential debate; I was simply seeking to summarise what I believed to be Mr Dennis’ evidence.

We will hear from him. If I am mistaken, I apologise.

Subsequently, he told Mr Mosley that Mr Alonso had retracted that allegation through his manager

(and Mr Mosley’s nod indicates that at least I got that part right). Mr Dennis did not believe the

original suggestion from Mr Alonso. However, the fact that he brought it to the attention of the

President of the FIA is the clearest indication that he believed that there was nothing further to be

disclosed. If Mr Dennis had known that Mr Alonso might be in possession of damaging

information, why would he tell the president of the FIA? That is hardly conduct consistent with

bad faith or dishonesty on the part of my client and Mr Dennis, in particular. It is consistent only

with our position throughout. It is said by Mr Tozzi that McLaren did not in fact investigate. You

can ask Mr Dennis why this was: he genuinely believed that the assertion was not true and it was

almost immediately retracted. Yes, he could have said that, despite his belief on this, he ought to

go back and check. Hindsight is a wonderful thing. Do not infer from that any bad faith on the part

of Mr Dennis. The FIA could have told Mr Dennis to go and check. It did not. Clearly, the FIA

did not think that it was appropriate or necessary for McLaren to take any further steps at that stage.

The second development is that Ferrari has obtained – they say legally so – certain selected

documents from police files in Italy and supplied these to the FIA. These suggest, assuming that

they are accurate, contact between Coughlan and Stepney beyond that to which Mr Coughlan had

previously admitted. However, this does not mean that McLaren was aware of it. It was not. The

documents do not suggest, other than on the basis of an inference which we will rebut, further

contact between Coughlan and people in McLaren, which is material for the purposes of your

consideration. Ferrari’s response to this new information has been to make a series of wild and

unsubstantiated allegations. They are contained within the conclusion which Mr Tozzi has invited

you to read. I will invite you to do the same. I will take you through it and tell you our answers to

each point.

In response to the question as to what is in issue before you today, I will say the following: you are

being asked by Ferrari to make a series of inferences and assumptions in the absence of direct

evidence, from which you are inevitably being asked to infer that all those who come forth on

behalf of McLaren are lying and that use has been made despite the denials from McLaren

witnesses. McLaren invites you not to work on inference and assumption, when you have direct

evidence. We invite you to listen to the witnesses, read their witness statements and to do so

quietly, dispassionately and, above all, carefully, and reach your own conclusions.

What conclusion must you reach? Can you, to the standard required of you, as I will later define,

be satisfied that our evidence, which fully rebuts any inference that Ferrari might wish you to draw,

is to be disbelieved? The President, on more than one occasion, following the promulgation of the

Extraordinary Meeting Fédération Internationale de l’Automobile

Paris, 13 September 2007 16

last decision of the World Motor Sport Council, has made it clear (and correctly so) that, given the

very serious nature of these matters, you would have to be satisfied to a very high standard before

you can convict of usage. I think that, in one letter, the President, in response to the letter from the

Italian MSA, referred to the need to show unequivocal evidence. In our submission, given the very

grave allegations and the fact that several of my witnesses are facing potential criminal proceedings

in Italy, you must be satisfied to a criminal standard – meaning, beyond reasonable doubt. I ask – I

require – you to look Mr Lowe, Mr Dennis, Mr de la Rosa and Mr Hamilton in the eye and, unless

you are satisfied beyond doubt that each and every one of them is lying to you, you will let us off. I

am not asking that you dismiss the charge. That is a matter for elsewhere. However, you will not

find that use has been made. If you do nonetheless do so, without being able to make those

decisions, then you are making a very serious legal error. It is not only those who are here. 140

McLaren engineers signed the letter: will you disbelieve each of them as well? If so, we will

contact them by phone and you will be able to question them. We did not bring them here, for that

would have been absurd. Nonetheless, there is a huge body of evidence showing that you cannot

and must not draw inferences adverse to McLaren on the information available to you, because

those inferences are false.

It is right, given what I have just said, that you bear in mind that this is not the referral of your

previous decision, which must go elsewhere. It has been withdrawn. However, the referral

allowed the body to which the reference is being made – our International Court of Appeal – to

look afresh at the events on the 26 July, the evidence given and the factual conclusions reached.

That is not your function. You are functus in relation to that; you cannot review your own decision.

Rather, you can consider the effect of new evidence. When you hear Mr Tozzi say that Mr Neale’s

evidence must, of course, be disbelieved, on what basis are you to do that? You made your

findings on Mr Neale’s evidence. You had your doubts about it. Mr Mosley made that clear. Yet

you did reach your conclusions. Unless something material in the new evidence entitles you to

form a different opinion about Mr Neale, that matter rests with you. If there is a subsequent referral

or appeal, that is another matter, but is it not a matter for you. This is, in short, not an opportunity

for Ferrari to make the same points as it did last time. Quite a large part of the submissions before

you today were the same put in for the International Court of Appeal. I am not criticising them for

this. Clearly, having produced a body of work, they are entitled to use it and adapt it. However,

while their assertions may have been apposite at the time, they are not so for this body today.

Could I ask for some respectful silence, from your right?

Max MOSLEY

I think you have that.

Ian MILL

It i