New York's top court has ruled in favour of BMW Oracle Racing in a lawsuit that pitted its billionaire owner Larry Ellison against Swiss holders Alinghi over the staging of the next America's Cup.

Ellison, a US software magnate, had argued that the rules of the next America's Cup were unfairly weighted in Alinghi's favour, including the right to disqualify teams or bar them from entering sailing's most glittering regatta.

The decision caps a clash of personalities and clears the way for the two sides to meet and negotiate terms for the next race due to be held in the Spanish city of Valencia in 2009.

Alinghi's owner and biotech scion Ernesto Bertarelli accused Ellison of trying to win sailing's most coveted prize in the courtroom having twice failed on the water.

In a statement, he said he was disappointed but looked forward to talks on the race.

At the heart of the case before the New York State Supreme Court was whether the rules set by Bertarelli's team matched the spirit of the "Deed of Gift", the document that has governed sailing's most glamorous event since 1887.

BMW Oracle took Alinghi to court arguing the holders had chosen an illegitimate Spanish yacht club as the main challenger with whom it could set the rules for the 33rd Americas Cup.

Many of the teams agreed that Alinghi's rules gave the Swiss syndicate an unfair advantage but only BMW Oracle had the money and determination to force a change through legal channels.

The ruling allows San Francisco-based Golden Gate Yacht Club, which is represented by Ellison's BMW Oracle syndicate, to race Alinghi head-to-head alone. But the club said it would seek to race with as many challengers as possible.

BMW Oracle chief executive Russell Coutts, a successful America's Cup helmsman, said he wanted a meeting with Alinghi as soon as possible to set the rules.

"We will be very happy if we can put the last few months behind us and get on with sailing," said Coutts, a former Alinghi skipper who famously fell out with Bertarelli and was sacked in 2004.

Alinghi's Bertarelli said he would review the ruling which he called a disappointment. "There will now be a thorough review of the judge's decision and an analysis of the various options offered," he said in a statement.

Reuters