Renault decision: FIA statement in full

Mon, 10 December 2007, 09:44

The World Motor Sport Council (“WMSC”) met on 6 December 2007 to consider a charge that Renault F1 Team (“Renault”) had breached Article 151(c) of the International Sporting Code, which prohibits “any fraudulent conduct or any act prejudicial to the interests of any competition or to the interests of motor sport generally”.

1. Introduction

1.1. On 7 September 2007, Renault notified both McLaren and the FIA that when one its employees, Mechanical Design Engineer, Mr. Philip Mackereth (“Mackereth”), joined Renault in September 2006, he brought with him certain information which was confidential to his former employer, Vodafone McLaren Mercedes (“McLaren”).

1.2. Following from Renault’s notification and from a complaint submitted by McLaren (which included a substantial dossier of information) the FIA wrote to Renault on 8 November 2007 requesting it to appear at an extraordinary meeting of the WMSC on 6 December 2007. Renault was informed that the purpose of this meeting was to answer the charge that between September 2006 and October 2007, in breach of Article 151(c) of the International Sporting Code, it had unauthorised possession of documents and confidential information belonging to McLaren, including, but not limited to the layout and critical dimensions of the McLaren F1 car, together with details of the McLaren fuelling system, gear assembly, oil cooling system, hydraulic control system and a novel suspension component used by the 2006 and 2007 McLaren F1 cars.

1.3. McLaren and Renault made extensive written submissions in advance of the 6 December WMSC meeting. Mackereth (who was separately advised) also made submissions in relation to his conduct which were supportive of Renault’s position. Renault and McLaren were given copies of each others’ submissions. In addition, the WMSC received a full copy of the information that Mackereth was said to have taken from McLaren and a confidential dossier submitted by Renault which purports to set out the design evolution of a number of relevant Renault systems.

1.4. At the 6 December WMSC meeting, oral submissions and explanations were made on behalf of Renault and McLaren and evidence from a number of witnesses was heard (including from Mackereth himself). WMSC put questions to those concerned and opportunities were also offered and taken up for Renault and McLaren to cross-examine each others’ witnesses.

2. Summary of main findings

2.1. It emerges from the written and oral submissions made (and it is admitted by Renault) that different Renault engineers received and considered four confidential McLaren drawings from Mackereth. In this regard Renault admits a breach of Article 151(c) of the International Sporting Code.

2.2. Mackereth took a much more significant volume of information from McLaren including some confidential information, some information that was not proprietary to McLaren and some personal financial information. The WMSC can be concerned only with what Renault had access to (rather than what Mackereth took) from McLaren as only the former could impact the FIA Formula One World Championship (“the Championship”).

2.3. The WMSC has concluded that of the four drawings actually viewed by Renault’s engineers, three were either of no use to Renault or were not in fact used by Renault. The fourth drawing (a drawing of McLaren’s so-called ‘J-damper’) was used by Renault to try to have the system that they thought McLaren was using declared illegal. This failed because Renault had certain fundamental misunderstandings about the operation of the ‘J-damper’ system. This suggests that Renault’s sight of the ‘J-damper’ drawing did not give Renault enough information to understand how it worked. In these circumstances, an affect on the Championship cannot be established.

2.4. Some of the key elements that the WMSC has considered are set out below. In light of the strong imperative in the interests of the sport to issue a swift ruling, the following does not constitute an exhaustive list of the elements considered nor does it purport to be a summary of all of the evidence put before the WMSC.

3. Taking of information from McLaren

3.1. The evidence before the WMSC is that prior to leaving McLaren and before he joined Renault in September 2006, Mackereth took personal possession of certain information and materials. This included confidential McLaren information as well as materials which were copyrighted to other parties (e.g. materials received while on external training courses) and some personal materials. In particular he copied 33 electronic files onto 11 floppy disks and took them to his home. These 33 electronic files included 18 drawings as well as Mackereth’s personal financial information. He also e-mailed a file called ‘peak2.tif’ to his home computer.

3.2. From his time at McLaren, Mackereth also had in his personal possession two hard copy drawings. These were of damper systems: one of a mass damper and one of a so-called ‘J-damper’.

3.3. According to McLaren, if all of this information (confidential, non-confidential and personal) taken together is printed out on A4 pages it amounts to 762 pages.

4. Passing of information to Renault

4.1. Shortly after joining Renault, Mackereth asked an IT assistant to transfer the files on the 11 floppy disk files, which he described as containing “personal information”, on to the Renault IT system. The WMSC understands that the files were uploaded onto the Renault IT system and within around ten minutes were transferred to Mackereth’s personal directory where only he had access to them. It appears that the files were not viewed during the transfer by anyone other than Mackereth. Renault has submitted that this represented 207 pages, 108 of which contained McLaren information.

4.2. Mackereth admits that after joining Renault he e-mailed the file ‘peak2.tif’ (containing a one page ‘screen grab’) to his Renault e-mail account where he renamed it ‘21aspec.tif’. Mackereth also admits that soon after he joined Renault, he took the two hard copy drawings from his home to work.

4.3. Although volume is no indicator of value, to offer a sense of perspective, of the 762 pages of information taken by Mackereth, 111 pages contained McLaren information and were transferred to Renault’s systems or premises (about 15%) and were therefore theoretically under Renault’s control.

5. Investigations

5.1. Based on Mackereth’s own evidence to the WMSC, it appears that a former Renault employee moved to McLaren and informed McLaren that Mackereth had disseminated certain McLaren information within Renault. Mackereth seems to have discovered this and then came forward to Renault’s senior management (presumably in anticipation of some action from McLaren).

5.2. Mr. Bob Bell, Technical Director of Renault, carried out a preliminary investigation on 6 September 2007, the results of which were sent by Renault to McLaren and the FIA on 7 September 2007. Over the next two weeks, some 20 engineers were interviewed by Mr. Bell, leading to 14 witness statements. In addition an internal IT search was conducted.

5.3. Renault kept both McLaren and the FIA regularly informed of the progress of its investigation. This has resulted in extensive correspondence between McLaren’s lawyers and Renault’s lawyers. This correspondence has been put before the WMSC and shows McLaren’s lawyers extensively questioning and testing the evidence disclosed by Renault’s lawyers to them and to the FIA.

5.4. Independent IT experts (Kroll OnTrack) were appointed by McLaren and, with Renault’s agreement, were given wide-ranging access to Renault’s IT systems and have conducted in depth analysis of IT equipment used by Mackereth in particular.

5.5. With Mackereth’s agreement, McLaren’s IT experts have also searched Mackereth’s home computer for confidential McLaren information.

5.6. When McLaren raised questions about the information provided by Renault, Renault and its lawyers responded in writing and in a timely manner, by providing further information or clarifications, and in some cases conducting further interviews and providing additional witness statements.

5.7. In addition, Renault agreed to submit to an investigation by the FIA technical department to establish whether there is any evidence that Renault’s 2007 or 2008 cars incorporate any McLaren confidential information. This involved FIA technical personnel:

5.7.1. reviewing the McLaren confidential information that was taken to Renault by Mackereth;

5.7.2. reviewing confidential information about the development of Renault’s F1 cars from 2005 to 2008; and

5.7.3. carrying out inspections at Renault’s F1 headquarters where Mackereth worked.

5.8. The resulting report has been taken into account by the WMSC.

5.9. Renault has removed the McLaren confidential information from its IT system. However, Renault’s IT system is backed up to tape nightly and a monthly back-up tape is retained permanently. It is not possible to delete data selectively from these back-up tapes and it is therefore estimated that around 28 back-up tapes remain that may contain copies of the McLaren confidential information brought by Mackereth to Renault.

5.10. The findings of Renault’s preliminary inquiry were that no dissemination beyond Mackereth had occurred. This had been Mackereth’s evidence at the time. The various internal and external investigations, very much assisted by McLaren, demonstrate that this initial position was incorrect. Renault accepts this and its various witness statements produced after these initial findings have clarified the position.

5.11. In all, the WMSC finds that that Renault’s senior management acted responsibly after it became aware of the issues and took an open and cooperative approach with both McLaren and the FIA.

5.12. The investigations revealed that Mackereth took a relatively significant volume of information from McLaren. However, the evidence supports the conclusion that only four items were ever shown to or made known to persons at Renault. McLaren made submissions that other documents might have been discussed, disseminated or used but after its own extensive investigations can offer no evidence to this effect. Nor has the FIA’s own investigation indicated any such evidence.

6. The McLaren drawings disseminated within Renault

Fuel System Schematic

6.1. It is accepted by Renault that a schematic of a McLaren fuel system was seen by at least two Renault engineers, including the Chief Designer, Mr. Densham and Mechanical Design Engineer, Mr. Gordon Hardie. This drawing was one of the 18 drawings uploaded to Mackereth’s personal drive from the 11 floppy disks taken from McLaren. The evidence before the WMSC indicates a photocopy was made of the drawing by Mr. Hardie, but there is no clear evidence that he made any further use of it and he insists that he did not. He apparently did keep it in a pile of papers until early September 2007, when Mackereth asked for the drawing back to destroy it.

6.2. Renault has argued that the schematic was of no interest or value to it as the McLaren fuel system employed an entirely different concept to that used by Renault. Renault has also argued that the drawing was a schematic of the fuel system and its parts, rather than a detailed drawing containing information necessary to design or manufacture the system. However, McLaren has argued that its fuel system is highly innovative and almost certainly unique in Formula One, and that the schematic would be highly valuable to another F1 team. The FIA technical department’s assessment concluded that, “There appear to be no similarities of any significance between any Renault fuel system since 2006 and the McLaren design provided by Mr. Mackereth”.

6.3. There is no evidence before the WMSC that convinces it that the fuel system schematic influenced or had any impact on Renault’s design approach or the development of its F1 cars.

Gear Layout

6.4. Renault has also acknowledged that Mackereth showed a drawing of a gearbox assembly to the Chief Designer and Mr. Osgood, the Renault Head of Transmission Design. This drawing was one of the 18 drawings uploaded to Mackereth’s personal drive from the 11 floppy disks taken from McLaren. The drawing was “a layout scheme of a longitudinal cross section through a gear cluster” and a paper copy of it was seemingly kept by the Chief Designer in a pile of papers on his desk, where it remained until 7 September when Mackereth asked for it back so that he could destroy it at the same time as the fuel system schematic.

6.5. Both Mr. Densham and Mr. Osgood have stated that, beyond briefly reviewing the drawing, they took no further interest in the gearbox assembly drawing. Mr. Densham explained that he viewed it out of “academic” interest only as, by the time he was shown the drawing in June 2007, Renault had already designed its 2007 and 2008 gearboxes, and it was pursuing a different design philosophy. However, McLaren submits that the drawing in question details McLaren’s innovative ‘seamless shift’ gear system and that any Formula One team would have been extremely interested in finding out how such a system might work. The FIA technical department advises that “There is no evidence to suggest that the McLaren information influenced the design of the 2007 to 2008 transmission system.” In particular, the only fundamental change to the 2006 Renault gearbox for 2007 was the introduction of a ‘quickshift’ system, but that as this was built and tested at around the same time that Mackereth joined Renault in September 2006 it is “highly unlikely” that his information had any influence on the new feature.

6.6. There is no evidence before the WMSC that convinces it that the drawing of the gearbox assembly influenced or had any impact on Renault’s design approach or the development of its F1 cars.

Damper Drawings

6.7. The WMSC has heard evidence that soon after Mackereth joined Renault in September 2006, he had two conversations about the general features of the McLaren damper system with two Renault engineers, including the Deputy Technical Director, Mr. Allison. The conversations related to the FIA’s decision to ban tuned mass dampers in July 2006, and statements by Mr. Ron Dennis at the German Grand Prix that McLaren had an alternative and legal system that achieved results similar to a tuned mass damper. Following these initial conversations, Mackereth admits that, sometime in October 2006, he brought paper copies of two McLaren drawings of a mass damper and a ‘J-damper’ from his home and showed them to Mr. Allison and the Head of Mechanical Design, Mr. Duffy.

6.8. Mackereth also admits showing the drawings of the McLaren mass damper and the ‘J-damper’ to a further three Renault engineers, one of whom also admitted photocopying the drawings so that he could study them at home. He returned the originals to Mackereth and later destroyed the copies he had taken.

6.9. In the context of its concerns about the legality of McLaren’s damper system, Renault admits reviewing the drawing of the ‘J-damper’ with the intention of trying to understand how it worked and asking the FIA to confirm whether the McLaren system, as understood by Renault, was legal or not with a view to having the McLaren system excluded (there is nothing to suggest that Renault intended to try to copy the system).

6.10. Renault subsequently submitted a question about the system it thought the ‘J-damper’ drawing depicted – a spinning mass damper – to the FIA. The FIA confirmed that the damper system described in Renault’s hypothetical request would be illegal if used. However, the question put by Renault reveals that it did not understand certain fundamental aspects of the McLaren system.

6.11. The assessment by the FIA technical department concluded that the ‘J-damper’ drawing shows a particular type of damper that, “has not been used, nor will it be used, on the Renault car. All dampers on the Renault car of conventional design and come from an outside supplier.”

6.12. The WMSC has seen no evidence that suggests that the mass-damper drawing even could have influenced or had any impact on Renault’s design approach or the development of its F1 cars because this type of damper had been banned. Although the ‘J-damper’ drawing was taken into account by Renault in trying to have a McLaren system declared illegal, the evidence strongly suggests that the ‘J-damper’ drawing did not reveal to Renault enough about the McLaren system for the Championship to have been influenced as even after seeing the drawing Renault continued to believe that McLaren operated quite a different system.

7. E-mailed file ‘21aspec.tif’

7.1. Even though the four documents described above were the only ones disseminated within Renault, the WMSC feels that it is worth mentioning one other confidential McLaren document taken to Renault by Mackereth – the file called either ‘peak2.tif’ or ‘21aspec.tif’.

7.2. McLaren described the file ‘21aspec.tif’ as being a ‘screen grab’ of a confidential McLaren document called the ‘MP4-22A Technical Specification’ sheet. This technical specification sets out the principal dimensions of the McLaren 2007 F1 car. It was issued by McLaren on 16 July 2006. The file e-mailed was a screen grab because the original McLaren document had security features that would not allow it to be printed or saved locally.

7.3. Mackereth and Renault have both denied that the file ‘21aspec.tif’ was sent to anyone in Renault by Mackereth and the WMSC has seen no evidence that suggests that the file was seen, accessed, copied, printed or otherwise used or discussed by anyone in Renault, other than Mackereth. Although it is deeply unsatisfactory that Mackereth might have evaded McLaren’s security protections and taken a ‘screen grab’ of such a sensitive document, the fact that he did so is only relevant to this enquiry if there is evidence of Renault having been influenced as a result. The WMSC has no such evidence.

8. WMSC’s assessment

8.1. The WMSC has carefully considered the evidence and submissions of all parties.

8.2. It has concluded that a clear breach of Article 151(c) has occurred. This is conceded by Renault.

8.3. It emerges from the written and oral submissions made (and it is admitted by Renault) that different Renault engineers received and considered four confidential McLaren drawings from Mackereth.

8.4. It is common ground between Renault and McLaren that Mackereth took a more significant volume of information from McLaren. This included confidential information as well as materials that were copyrighted to other parties (e.g. materials received while on external training courses), and Mackereth’s personal financial information. However, having heard the evidence it emerges that Renault never had possession or knowledge of the large majority of this volume.

8.5. About 15% of what was taken by Mackereth contained McLaren confidential information and was in Renault’s control or technical possession. Mackereth uploaded 33 electronic files (including 18 drawings and personal information) to an area on the Renault computer system which was accessible only to him. In addition, he e-mailed one file (a ‘screen grab’ of a drawing) to his Renault e-mail account and brought in two hard copy drawings. However, there is no evidence of any McLaren documents or files being viewed or considered by anyone at Renault other than the four drawings referred to above.

8.6. While McLaren is right to be extremely concerned about its employee taking information upon his departure, the concern of the WMSC is not with what Mackereth took. This is a matter between McLaren and its former employee. The WMSC is concerned with what Renault had access to or was influenced by as only this could have had an impact on the Championship.

8.7. The WMSC has concluded that of the four drawings actually viewed by Renault’s engineers, three were either of no use to Renault or were not in fact used by Renault. The fourth drawing (a drawing of McLaren’s so-called ‘J-damper’) was used by Renault in that Renault admits taking it into account in preparing a request to the FIA for a clarification of whether a particular hypothetical system was within the rules (rather than for the purposes of copying it). The fact that Renault fundamentally misunderstood the operation of the system suggests that the ‘J-damper’ drawing did not reveal to Renault enough about the system for the Championship to have been affected.

8.8. The McLaren confidential information brought to Renault was in the context of an F1 engineer changing teams. It was not ‘live’ information in the sense that there is no evidence of a flow of current information between competing teams. After leaving McLaren, Mackereth had no further access to current or updated McLaren information. Nor is there any evidence that Renault encouraged Mackereth in any way to bring the confidential information from McLaren.

8.9. The WMSC considered it significant that Renault approached the investigation with an open and transparent attitude. The WMSC also notes that Renault has co-operated fully with the FIA technical department’s investigation.

8.10. However, the WMSC notes with strong disapproval the fact that there were individuals of sufficient seniority within Renault who should have known that the drawings that Mackereth showed them contained proprietary confidential information. This organisational failing meant that they did not report the matter to their line managers as they should have done. Had they done so, the matter may have been brought to the FIA’s attention at a far earlier stage.

8.11. The WMSC has also taken into account that Renault has introduced a number of new measures with the aim of preventing a similar problem occurring again, and that Renault appears to have taken a pro-active approach in reforming and updating its practices, some of which were introduced before Mackereth’s actions came to light.

8.12. In these circumstances, although a number of very unsatisfactory elements were noted during the deliberations, in assessing the gravity of the breach, the WMSC concluded that there was insufficient evidence to establish that the information was used in such a way as to interfere with or to have an impact on the Championship.

8.13. Taken together, these factors lead the WMSC to conclude that in the circumstances no penalty can be imposed.

8.14. It should be noted that in the event of new information coming to light which calls into question the WMSC’s conclusions in this decision, this matter may be re-opened by the FIA.

9. Renault back-up tapes

9.1. The WMSC notes that Renault and McLaren have committed to work together to agree a solution that will ensure that all copies of Renault IT back-up tapes that may contain the McLaren confidential information will be put out of reach of Renault and only released to Renault in the event that they are needed for technical IT reasons.

10. Press statements

10.1. The WMSC notes that in advance of the hearing there had been statements in the press indicating that Renault had possession of very large numbers of McLaren drawings. McLaren has acknowledged to the WMSC that it circulated an erroneous press briefing which had created this impression, and has apologised and issued a correction. As far as the present proceedings are concerned, that concludes the matter.

11. Decision

11.1. For the foregoing reasons, the WMSC:

11.1.1. finds Renault in breach of Article 151(c) of the International Sporting Code,

11.1.2. imposes no penalty due to the lack of evidence that the Championship has been affected.

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