Twelve years ago a Maori protester walked into the Royal New Zealand Yacht Squadron and battered the America’s Cup with a sledgehammer. The damage done then to the oldest international sporting trophy was nothing compared to the blow inflicted on its reputation this week by a combination of a New York judge, a 19th-century contract, two feuding billionaires, Iranian militants and a sex scandal involving a sheikh.

On Tuesday night, the New York Supreme Court ruled that the next sailing regatta for the America’s Cup, first contested in 1851, cannot take place in the United Arab Emirates, as requested by Alinghi, the holders, who are owned by Ernesto Bertarelli, a Swiss pharmaceuticals tycoon.

It leaves the competition, which legally has to be held by February, without a venue and with little chance of Mr Bertarelli reaching an agreement on its future with Larry Ellison, the American computer magnate who owns BMW Oracle, the official challenger.

The ruling this week was the eighth legal judgment to be made in the increasingly bitter dispute between the men, who are worth a combined £20 billion. Lawyers for Alinghi claimed that the ruling was cataclysmic and would do “colossal harm to the sport”. Oracle retorted with a claim that Alinghi tried to fix the rules.

Justice Shirley Kornreich agreed with Oracle that under the original deed of gift governing the cup, a regatta could not be held in the northern hemisphere during winter. Alinghi said that the requirement had been overturned in a ruling last year.

The judge rejected the claim by Oracle that the little-known Gulf emirate of Ras al-Khaimah was unsafe. Oracle had asked the US State Department to assess security in the emirate, fearing a terrorist attack on an American team competing so close to Iran.

Alinghi wanted the regatta in the Gulf because the flat water and gentle winds would suit its 90ft (27m) catamaran. While Alinghi could choose any southern hemisphere venue, Oracle pointed to a separate rule by which it must have six months’ notice.

That leaves Valencia in Spain as the last resort. The sides agreed last year that it was acceptable, but that was before a judge ruled that the regatta had to be in February. Oracle has a heavier trimaran that will perform better in the Mediterranean conditions in February.

The row has included muck-raking. A report appeared three weeks ago on an American news website owned by Ted Turner, a former America’s Cup-winning sailor and a friend of Mr Ellison. It said that the Crown Prince of Ras al-Khaimah was arrested in 2005 and accused of sexually assaulting a housekeeper in Minnesota. The case was dropped through lack of probable cause.

Meanwhile, would-be contenders for the cup — including a British entry called Team Origin, skippered by Ben Ainslie, the triple Olympic gold medal-winner — have been banned from competing in the next cup by an earlier court ruling between Mr Bertarelli and Mr Ellison.

Sir Keith Mills, the head of Team Origin, expressed relief that the judge had not changed the date of the next cup, but said: “There is a real groundswell of opinion that the governance around the cup has to change for future regattas. The sooner we get this one out of the way, we can get on with a proper America’s Cup.”

Russell Coutts, the Oracle skipper, said: “I accept that the America’s Cup has always been hard to win, but you shouldn’t have rules that make it impossible for the defender to lose.”

Brad Butterworth, the skipper for Alinghi, said: “Great sportsmen seek victory on the field of play or, in our sport, on the high seas. A sportsman seeking to win through the courts only taints any victory.”

More legal battles are in the offing. Oracle began a suit this week to remove Société Nautique de Genève, the Swiss club backing Alinghi, from its position as trustee of the cup. If that is upheld, a third party would arrange the regatta.

Racing into history

— The silver ewer known as the America’s Cup was made in 1848 by Robert Garrard, the British Royal Jeweller

— In 1851 it was donated to the Royal Yacht Squadron, which began offering it as a prize in a race around the Isle of Wight

— It acquired its current name when the America, from New York, won the first contest

— Until 1987 American yachts had an unbroken run of wins for 132 years

— The cup is also known as the Auld Mug, the £100 Cup and the 100 Guineas Cup

Sources: Britannica Online; americascup.com