Team New Zealand is blaming challenger Luna Rossa for a decision that effectively cancels the use of the inner Waitematā Harbour race courses for all America's Cup races.
The America's Cup Arbitration Panel have issued a ruling meaning two race courses just off Takapuna and Devonport and watchable from land won't be used.
Team New Zealand chief executive Grant Dalton is blaming Challenger of Record Luna Rossa for leading the campaign to drop the courses, and is describing the decision as "unbelievable".
"Quite frankly we are outraged by this decision, it has gone against everything we have been trying to achieve over the last three years, with no consideration to the effect this has on the public of New Zealand and the city of Auckland," Dalton said.
He said the decision had considerable repercussions to the accessibility of the event for the public, with images of Auckland City as a backdrop during racing being a critical part of showcasing Auckland and New Zealand to the world and were all part of the original race course designs.
"For three years we planned this around the stadium of, and view of Auckland ... by the Arbitration Panel, on a 2-4 majority upholding this decision, they've robbed New Zealand of that ability.
"The basis of their application is because during the first rounds of the Prada Cup, they can't sail there from a traffic point of view in and out of shipping etc, and some paranoid behaviour that somehow that gives us some advantage be it that we've lived here since we were born. We'd probably have a slight advantage anyway in terms of local knowledge."
He said the ultimate goal was to disrupt the defence of the Cup in whatever way possible.
America's Cup commentator Peter Lester said the public would still be able to see the race, but perhaps not as close up as initially hoped.
"The last time the America's Cup was here, essentially the racing was quite a long way out in the Hauraki Gulf. What Grant Dalton and Emirates Team NZ were trying to do, or are trying to do, is bring racing into the harbour ... and then the other course was then considered was right off the tip of North Head and Bastion Point and they're the two courses that are being taken away, so I can see why Team New Zealand are frustrated."
Lester is realistic about how the regatta works however.
"It is part of the game, for challengers to unsettle the defender ... of course they will do that, nothing new in that, that's been going on for the 169 years of history in the America's Cup."
In a statement, Luna Rossa have hit back at Team NZ's "attack", saying it was intended solely to discredit them and mask an "attempt to gain an unfair advantage over the Challengers".
They claimed that the defenders of the Cup had kept hidden, until recently, that "the Round Robins and the Semi-Finals of the Challengers Selection Series - the PRADA Cup - could not be sailed on courses B and C, designated as preferred courses for the Final Match."
After hearing of this, and with support from the other challengers, they requested that one of the previously formulated America's Cup rules be enforced, which says "that all the PRADA Cup Challengers Selection Series races must be sailed '...within the course areas of the Match...'."
"Upon learning of the situation, the Challenger of Record (COR36, Luna Rossa), supported by all the Challengers, requested that the above-mentioned rule 3.1 be enforced.
"With the aim to restore sporting fairness and equity, the Arbitration Panel ruled that either racecourses B and C could be used for all the regattas of the PRADA Cup, or they could not be used at all.
"The attacks by Emirates Team New Zealand are intended solely at discrediting the Luna Rossa Prada Pirelli team with populist pretexts that tend to mask the attempt to gain an unfair advantage over the Challengers who, we repeat, unanimously supported COR36 by each lodging their own independent submission," Luna Rossa said.
Team NZ are not the only ones rocked by the decision. Auckland Mayor Phil Goff said he wanted the Cup to be accessible to as many Aucklanders and New Zealanders as possible and encouraged all parties to work together to find a solution.
Yachting fans in Auckland's Viaduct Harbour say the change puts the races out of touch for those on the shore.
"I'm surprised, I think having the America's Cup here is going to be really popular ... It was so publicised about having the inner Harbour courses, for them to actually turn around and take it away ... if America's Cup's past is anything to talk about, I would say to you this isn't the end of the story," one Aucklander said.
"I'm sure that if Team NZ is not in favour of that there will be an appeal, there might be a court hearing, who knows, so this is early days."
"It would be nice to think we could mix and get everyone involved in it and celebrate the success of what America's Cup has been," another said.
"It's more than disappointing," one woman said. "I think it's been a bit of a let down for the people of New Zealand, we are hosting the Cup, why would we not want it to be out there where people can actually get a really good vantage point from the shore.
"We want people to be able to enjoy it. Team New Zealand need to get their backsides into gear and get this changed, it's ridiculous."
While Team New Zealand said it was considering its options, Dalton said they were pretty limited.
"There's no right of appeal, the Arbitration Panel rules we wrote so that we didn't have argy-bargy with people appealing all the time. I don't know what can be done at this point ... [we will probably] consider it when we get over the shock of what is a terrible decision."
The Prada Cup challenger series starts in mid-January with the winner racing Team New Zealand for the America's Cup in March.