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Ford Motor Company, Carroll Shelby and Shelby American Initiate Legal Actions To Halt Infringement of Cobra and Shelby Trademarks

17 July 2000

Ford Motor Company, Carroll Shelby and Shelby American Initiate Legal Actions To Halt Infringement of Cobra and Shelby Trademarks

    BOSTON - With backing from Shelby American Inc., its equity partner, Venture
Nevada, and together with Ford Motor Company, automotive manufacturing and 
racing legend Carroll Shelby has launched an aggressive lawsuit in Massachusetts 
Federal Court against Wareham-based Factory Five Racing, Inc., asserting 
trademark infringement, dilution and unfair competition claims.  A parallel 
lawsuit has also been filed by Ford in the same court.

    The suit charges Factory Five with unlawful use of Ford and Shelby
trademarks and other intellectual property rights.  Factory Five, a rapidly
growing, five year-old company, has manufactured and sold more than 1,000
counterfeit copies of the famous Shelby 427 S/C, according to the suit.

    In an effort to curtail the misuse of the Shelby(R) and Cobra(R)
trademarks, Shelby has for years tried diplomacy and negotiation, and such
previous efforts have resulted in numerous licensing agreements covering a
wide range of products.  However, Shelby contends that several large replica
manufacturers, including Factory Five, seem determined to continue their
counterfeiting operations, unless they are stopped by Federal Courts.

    The suit claims that Factory Five and others sell packages featuring
bodies that copy Shelby's famous roadster.  The companies then market their
packages as "faithful reproductions" of the 427 S/C while frequently marking
the cars with the Shelby(R), Cobra(R) and Ford(R) trademarks.  This
increasingly artful deception misrepresents a counterfeit as if it is an
original, the suit further states.

    The action by Shelby challenges Factory Five's operation as a willful
deception and unfair competition in violation of the Lanham Act and the
Massachusetts unfair trade practices law.  The suit seeks damages and attorney
fees, which may exceed $10 million.  Of critical importance to Shelby, the
suit seeks an order to seize and destroy Factory Five's fiberglass molds,
which it uses to fabricate the 427 S/C knockoff.

    "We have filed this suit to make certain that credit is given where credit
is due," stated Shelby.  "The knock-off car manufacturers don't deserve any
credit for what my team and Ford were able to accomplish in the 60's.  I don't
have much time left, but while I'm here I'll do everything I can to protect
the Cobra and Shelby names, and my companies will carry on long after I've
gone."

    According to Shelby, this lawsuit is the first of several which will
target the largest knock-off manufacturers.  "Enough is enough," he stated.

    This action comes after the conclusion of legal proceedings in 1997 in Los
Angeles Federal Court, in which Ford obtained a judgment, which recognized the
Cobra trademark as the sole and exclusive property of Ford Motor Company.  As
part of the final resolution of the case, Ford granted Shelby an exclusive
worldwide license to use the Cobra trademark and snake designs in connection
with all 1960s Cobra vehicles, which Ford acknowledged were created by Carroll
Shelby and manufactured by Shelby American, Inc. -- the world recognized
Manufacturer of Record.