Libel cash for Wingsail
IPC Magazines, part of Reed-Elsevier, dropped its appeal and has agreed to pay what John Walker, the Walker Wingsail chairman, called a "very substantial further amount" on top of the pounds 160,000 already paid. The amount will be less than a third of the pounds 1.485m awarded by a jury - although when costs are included the case will have cost the publishers well over pounds 1m.
Mr Walker and his wife, Jean, sued Yachting World after an article in January 1993 was highly critical of the Wingsail, a vessel that has vertical "wings" instead of conventional sails. The Walkers claimed the article was misleading and damaging, and the jury agreed. But, Mrs Walker said last week, "you think you've won and then there is this dawning that, until the case is finally settled, you haven't".
Because IPC had appealed, the Walkers were paid about 10 per cent of the award but none of their legal expenses. They also found they were unable to borrow from their bank, Barclays, because of the contingent liability they faced.
"Our manager asked if we could guarantee we would win, and we said we could not," Mr Walker said. For the same reason Walker Wingsail was unable to take up a long-term loan from an unnamed backer.
Walker Wingsail had been operating since 1982, but had not won any orders at the time of the court case. The long development process had been funded by individuals who provided pounds 9m through the the Business Expansion Scheme and the Enterprise Investment Scheme. In the past year the company has won five orders for its pounds 200,000 Zefyr 43 - but with with no funds coming in, and legal costs building towards pounds 500,000, its funds were steadily drained. "This June we had perhaps two months of life left," Mr Walker said.
He appealed to his shareholders to fund the creation of Walker Wingsail America, which would be free of the contingent liabilities of the UK company. They responded in droves, and the WWA issue has now raised $1m. Combined with the settlement, and the payment of its costs by IPC, the company is finally on a firm footing and, Mr Walker says, should make a profit next year.
It also received a stamp of approval from the Duke of Edinburgh, who sailed the vessel during Cowes Week and wrote afterwards that he could "clearly see its potential". The Walkers hope that this will help win acceptance from the traditional yachting community, which has been generally hostile to their hi-tech machine.
From next week WWA will be listed on the Bulletin Board, a junior electronic stock exchange in the US, and through it Mr Walker expects to raise another $7m which will be used to fund an American factory.
He hopes he will also be able to tap venture capitalists for the first time. "Banks and institutions have so far been useless to us," he said. "We were kept going by our marvellous set of shareholders."
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