LITIGATION ALLEY.(Championship Auto Racing Teams plagued by lawsuits)(Brief Article)

CART'S season got off to a better start than some anticipated with a successful inaugural race in St. Petersburg, Florida (AW, March 3). Yet as the series tries to build on that momentum and quell doubts about its long-term viability, a number of court battles threaten to bleed off its resources and energy. Several of those involve former CEO Joe Heitzler.

Some CART faithful suggest Heitzler did more damage in a year than the unenlightened self-interest of CART's ruling team owners had done in 20. Others claim Heitzler was a victim of circumstance. Either way, the man many called Jargon Joe isn't going quietly.

The litigation dates to March 2002, when CART struck first. That was when a new regime filed a federal suit in U.S. District Court in Detroit, claiming Heitzler hired employees and entered contracts on CART's behalf without approval from the board of directors. The suit contends that Heitzler continued to act on his own after ``written instruction to the contrary'' by spending more than $500,000 on unauthorized expenses, and it accuses Heitzler of fraud.

Arguably, the suit was grounded in an element of lingering animosity over Heitzler's short tenure, perhaps even a feeling of foolishness among CART board members. Heitzler was hired amid proclamations that the board had carefully selected the right person a year before he was fired. There was also the issue of Heitzler's contract, which had three years remaining at $600,000 per, and by some accounts is iron-clad. Sometimes the best defense is a good offense.

If that was CART's thinking, it hasn't panned out. Two days after the series fired its legal volley, Heitzler sued CART in a California state court in Los Angeles (his hometown). His suit charges breach of contract, fraud and negligent misrepresentation, and asks for $2 million plus interest, attorney fees and unspecified punitive damages. Heitzler contends he was fired after he took steps to eliminate conflicts of interest in CART's corporate structure.

Heitzler filed a second suit in Los Angeles county, charging several defendants with slander. Foremost among them are team owners Carl Haas and Pat Patrick, who, according to this suit, launched a secret campaign of ``malicious misinformation,'' to get Heitzler ousted.

A year later, despite judicial urging to settle, all three cases are set for trial. Heitzler's suits have been transferred to U.S. District Court in Los Angeles, with trials scheduled for this September (the slander suit against Haas and Patrick) and January 2004 (the suit against CART). CART's own claim, meanwhile, has been moved to U.S. District Court in Indianapolis. Trial is set for January 2004. CART has not responded to requests for comment on the proceedings. Insiders say CART's lawyers offered to settle for roughly two years of Heitzler's base salary in an effort to clear the slate. Extrapolating from comments by Heitzler's attorney in his suit, it seems the former CEO has no interest in a settlement.