The 35th America’s Cup was diced with more controversy yesterday when Italian team Luna Rossa threatened to withdraw from the sailing extravaganza over a proposed late change to the regulations.

With Oracle Team USA, the defender, having only just recovered from a protracted court battle with one of their former employees that resulted in the temporary “arrest” of one of their boats, a new dispute with one of the five challengers is in danger of muddying the waters.

Billionaire owner Patrizio Bertelli has vowed to withdraw Luna Rossa and, by extension, cancel the Cagliari leg of the America’s Cup World Series in June if Oracle refuses to offer “public clarification” on a proposal to downsize the class of boat to be used in Bermuda for the finals in 2017. Oracle made the announcement on Wednesday night that the choice to race exclusively in the AC45 throughout the America’s Cup, as opposed to having the AC62 for the finals would “dramatically reduce team operational costs”.

The possibility was discussed in a meeting in London last year, when only the Americans and Emirates Team New Zealand were in agreement. However, after everyone has witnessed how the AC45 has performed in testing, a bit of a sea change has taken hold — in most places, notably, apart from Italy.

“Team Luna Rossa Challenge is distinctly opposed to the proposal — announced today on the official website of the America’s Cup — to change the class rule for the 35th America’s Cup and therefore the boat that was previously accepted by all challengers on June 5, 2014,” the team said in a statement posted on its website.

“Luna Rossa does not believe that a sporting event should be disputed in a courtroom and does not intend to initiate a lengthy litigation process that would only bring prejudice to the event.

“If the principle of unanimity of all challengers required to change the class rule were not to be respected, Luna Rossa will be obliged to withdraw from the 35th America’s Cup.

“Team Luna Rossa trusts that the defender will quickly announce a public clarification, also to avoid jeopardising the organisation of the America’s Cup World Series — Cagliari — Sardinia event planned to take place from June 4 to 7, 2015.”

The Italians have form for challenging the established order, so it is believed that Mr Bertelli, who is married to fashion designer Miuccia Prada, will follow through on his threat if not appeased.

In July 2013, Luna Rossa sat out the opening race of the challenger trials in San Francisco Bay in a protest over rule changes. That left organisers with the embarrassing scenario of Emirates Team New Zealand sailing around the course alone. Soon after, Sir Russell Coutts, Oracle’s chief executive officer who has gone on to become director of the America’s Cup Event Authority, was quoted as calling the Italians “a bunch of spoiled rich kids dressed in Prada gear”.

The AC62 Class Rule can be changed only with unanimous consent, according to the protocol that was released in June 2014.

The teams are expected to vote on the change by the end of this month, with France having already given a strong indication in the affirmative.

“For Team France this will be a game-changer,” skipper Franck Cammas said. “We will be able to have a very competitive team for about half the budget. With the smaller boat, we can imagine that a budget between €15 million and €20 million (about $21.7 million) would be enough to win the America’s Cup.”

Harvey Schiller, the commercial commissioner who shocked the world last December when he revealed that Bermuda would host the finals, said: “After reviewing prototypes of the new AC45 sports boats being tested on the water over the past several months, it is clear that if we raced smaller boats in 2017, we could dramatically reduce costs without sacrificing any of the spectacle or the design, engineering and athletic challenge fundamental to the America’s Cup.

“We have a responsibility to think of what is best for the long-term health of the America’s Cup as well as improving the value equation for team principals and partners.

“Racing a smaller boat in 2017 and beyond is a big step in the right direction. The existing operational costs of teams is much too high with a boat like the AC62.”

The 72ft wing-sail catamaran thrilled crowds in San Francisco Bay for the 34th edition of racing for the “Auld Mug”, reaching speeds upwards of 50mph, and it was expected that the slightly scaled-down edition would do likewise in Bermuda’s Great Sound.

However, there have been concerns that the course drawn up for the World Series in October this year and the finals in two years’ time would be on the cramped side for the 62-footers. Sir Ben Ainslie, the team principal and skipper of the eponymous Ben Ainslie Racing, is one of those who has had his head turned. “This will be a big change, but it is a necessary one if we are to create a sustainable America’s Cup for the future,” he said. “These boats will create a significant cost-saving while still providing a real challenge for sailors and designers alike.”

Luna Rossa are believed to have spent millions already on their AC62 and if the owner’s threat is to be realised, have no problem being left alone on an island.