Much has been said about Carroll Shelby following his decision not to renew the licensing agreement for Shelby American Automobile Club, and much of it has not been terribly nice. Here in The Garage, we were fortunate to receive a bit of insight into the situation from our man on the west coast, Gary Faules earlier this week. Shelby’s people have been kind enough to keep The Garage in the loop with the following release:
CARROLL SHELBY LICENSING RESPONDS TO COMMENTS BY
KEN EBER AND RICK KOPEC
Gardena, Calif. Ã¢â‚¬â€œ December 7, 2007
Carroll Shelby, CEO of Carroll Shelby Licensing Inc., (CSL) has issued a statement in response to allegations made by the owners of the organization formerly known as the Shelby American Automobile Club.
Ã¢â‚¬Å“I wanted to explain my concerns to the members of the Shelby American Automobile Club directly, but couldnÃ¢â‚¬â„¢t because SAAC has refused to give me a list of its members, even though the licensee agreement with SAAC requires them to allow me access to their books and records. So I am being forced to share the facts through a news release.
Rick Kopec and Ken Eber, two of the individuals who run the for-profit business called SAAC, have said that they donÃ¢â‚¬â„¢t know why we didnÃ¢â‚¬â„¢t renew their annual license. ThatÃ¢â‚¬â„¢s not true. WeÃ¢â‚¬â„¢ve sent e-mails, made phone calls and mailed letters explaining our concerns for quite some time. Except for the message noted at shelbylicensing.com, they went unanswered. For the past several years, IÃ¢â‚¬â„¢ve repeatedly told them that I was unhappy with their disregard of the reporting requirements of their license agreement and the way they managed the club. And, for the past eight years, their business hasnÃ¢â‚¬â„¢t kept the terms of its extremely favorable agreement with my licensing company, Carroll Shelby Licensing.
Here are the primary reasons that we did not renew the license for this business:
For many years, I loaned truckloads of memorabilia to the club and provided 1960s production records for the registry; Kopec and Eber promised that everything would be returned to me whenever I asked. In fact, thatÃ¢â‚¬â„¢s what Kopec admits to on page 11 of the last printed edition of the Ã¢â‚¬Å“Shelby American World Registry,Ã¢â‚¬Â which was published in 1997. But they have refused to do so, and IÃ¢â‚¬â„¢m told they have sold many of the items, like cancelled Shelby American checks, over the Internet and the like. This is not what anyone had in mind when I let them borrow my things, or my licensing company granted them a license.
Under the terms of their licensing agreement with CSL, they were required to provide annual and quarterly sales reports, as well as certified statements of sales and a full audit. Also, if requested, they were to allow us Ã¢â‚¬Ëœfree and full accessÃ¢â‚¬â„¢ to their books, records and accounts. They have not done any of these things, even though IÃ¢â‚¬â„¢ve personally asked them many times.
TheyÃ¢â‚¬â„¢ve never provided proof of the basic liability insurance required by the license agreement. This could expose me personally and all of my companies to enormous liability.
They failed for nine years to even ask for, much less receive advance approvals from CSL of the thousands of products and product designs theyÃ¢â‚¬â„¢ve been selling under license, even though the license agreement clearly states that this failure is grounds for Ã¢â‚¬Å“immediateÃ¢â‚¬Â termination.
They didnÃ¢â‚¬â„¢t even pay the $1 per year licensing fee for the past nine years.
CSL not only has the right not to renew SAACÃ¢â‚¬â„¢s license (which was made for only one year at a time for a reason), but in light of their continued disregard for the license agreement requirements, my trademarks and other intellectual property rights are at great risk if I allow this to continue.
Kopec and Eber say SAAC has 5,000 members who pay almost a quarter-million dollars in dues each year. Then there are advertising revenues, sponsorships and money made at the SAAC national convention. In return, from what I can tell, members receive just one mediocre publication and a couple of classified advertising newsletters.
And where is the Registry that has been promised year after year? The last one was published 10 years ago. I have received many calls from people who have paid hundreds of dollars for a Registry; they have threatened lawsuits against me and my companies because they have not received their book. The basic information in the Registry about colors, how many cars were built, etc., should be regularly updated and available online for instant access by members.
Kopec and Eber recently offered sponsorship of the club to a kit car maker. I have no issue with the individuals who buy kit cars and love the Shelby brand. But, would GM let Chrysler sponsor the Corvette Club? Would Harley Davidson ignore an attempt by Kawasaki to sponsor the Harley Owners Group?
I tried for years to address changes that should be made, but my requests fell on deaf ears. Some of the correspondence concerning this matter can be found at www.shelbylicensing.com. So my licensing company and I asked Eber and Kopec to return the 1960s records and items they originally promised to give back to me, as well as those they have collected over the years using my name under license. And I told them that they canÃ¢â‚¬â„¢t use my name or the name of my company anymore, and to dispose of their inventory as required by the license agreement.
Now they want club members to give them hard-earned money to defend their business interests. Eber and Kopec are asking people to help sue me when they wonÃ¢â‚¬â„¢t even tell anyone, much less my licensing company, how much money the club has made over the years collecting member dues and selling Ã¢â‚¬ËœShelbyÃ¢â‚¬â„¢ memorabilia and merchandise for a royalty fee of only $1.00. Are they fighting me because theyÃ¢â‚¬â„¢re really afraid for the Registry or do they fear giving us financials, which theyÃ¢â‚¬â„¢ve been required to do, but refused?
Shelby enthusiasts, as well as SAAC club members and registrars deserve better. They should have a club that provides good value and benefits everyone who is involved. They deserve a club that leverages technology to share information and runs events that encourage people to enjoy their cars. They deserve to be treated with class and respect. To say that Team Shelby will negatively impact the value of Shelby cars is ridiculous.
IÃ¢â‚¬â„¢ve received probably 250 telephone calls from people asking me to check on whether a particular Cobra or Mustang they wanted to buy is authentic. The next thing I hear from them is that Ken Eber has bought it. Where I come from, when thereÃ¢â‚¬â„¢s that much smoke thereÃ¢â‚¬â„¢s usually some sort of fire!
Also, IÃ¢â‚¬â„¢ve been told many times by members that Ken Eber has said that he doesnÃ¢â‚¬â„¢t need Carroll Shelby. Well, now he wonÃ¢â‚¬â„¢t have to bother with me and I wonÃ¢â‚¬â„¢t have to bother with him. And, it seems to me that they make enough money that they donÃ¢â‚¬â„¢t need to go around poor-mouthing to the Club members to finance their legal defense fund against me. Shame on both of them! And, as far as Ken and RickÃ¢â‚¬â„¢s associate, Mr. Pardee, the Club members should ask him how much of my personal memorabilia is being stored in his garage that, by all rights, should come back to me. Even though the three of them have slandered me by making public statements that I am Ã¢â‚¬Ëœevil,Ã¢â‚¬â„¢ IÃ¢â‚¬â„¢m still entitled to get my personal belongings back. Who can disagree with that?
The bottom line is my legacy should be left in the hands of my family and real enthusiasts. I want to extend an offer to the local clubs to contact my office and arrange for a license to use the Shelby and Cobra name at the same base cost that we offered SAAC of $1. This will allow them to continue their great work.
ItÃ¢â‚¬â„¢s my right to stop letting someone use my name and the name of my legacy company, Shelby American, when they wonÃ¢â‚¬â„¢t listen to me or keep the terms of the licensing agreement they signed many years ago. Team Shelby wonÃ¢â‚¬â„¢t be run that way. You have my word on it.Ã¢â‚¬Â
About Carroll Shelby Licensing
Automotive manufacturer and entrepreneur Carroll Shelby is one of the most famous and successful high performance visionaries in the world. In 1998, he founded Carroll Shelby Licensing Inc., which is the exclusive holder of trademarks and vehicle design rights for some of the most famous muscle cars and high-performance vehicles. CSL also holds trademark rights for Shelby-branded apparel, accessories and collectibles. For additional information about the company or licensing opportunities, call (310) 914-1843 or visit www.shelbylicensing.com.