Car Rater J. D. Power, Rival Head for Court : Autos: The industry leader sues after two employees jump to the Santa Ana company. The smaller firm says Power seeks to ruin it financially.

J. D. Power & Associates in Agoura Hills is nearly synonymous with car research, which Power has earned by publishing customer-satisfaction surveys and other analyses for the world’s auto makers for more than a decade.

But that isn’t stopping AutoPacific Group Inc. of Santa Ana from trying to muscle in on parts of Power’s business.

AutoPacific, with about $2 million in annual revenue, is only one-tenth Power’s size, and it does not compete in Power’s stronghold: ranking cars by owner preferences. It’s those surveys that provide Power with much of its publicity, because auto makers that score well often tout Power’s ratings in their advertising.

AutoPacific does research on individual cars and forecasts industry sales and production trends--a field where Power also competes.

Last summer AutoPacific scored a coup by hiring one of Power’s best-known analysts, Christopher W. Cedergren, and Cedergren’s associate, Steven L. Morrison.

AutoPacific’s founder and president, George C. Peterson, is himself a former Power executive. So his six-member firm is armed with three ex-Power analysts competing against their old boss, J. David Power III, who started J. D. Power & Associates in 1968.

The defection of Cedergren and Morrison has led to a legal fight. Last November, Power sued AutoPacific in Superior Court in Los Angeles, alleging that Cedergren and Morrison took confidential Power documents, computer disks and other data and used the information in AutoPacific’s research. The suit seeks $750,000 in damages.

Peterson said some data was taken but returned at Power’s request. Denying wrongdoing by his firm, he said “not one nano-byte” of the data was used in any AutoPacific report.

Peterson, 44, said AutoPacific is being hurt financially by the suit. He said Power is using the courts to try to destroy AutoPacific because his company has become another respected voice in the industry.

“I guarantee you their objective is to put AutoPacific Group out of business by forcing us to pay onerous legal expenses,” he said. “A lot of it has to do with the public face, just the fact that Chris left. Until Chris came on board, we were probably just a fly on their hide. Now our presence is substantially higher. I think they took it personally.”

Power, who is also majority owner of his firm, declined comment. His lawyer, Michael K. Grace, said Peterson’s assertions are “baseless.”

Grace said Power twice tried to settle the dispute, before and after the suit was filed. Without going into specifics, Peterson called Power’s second offer “ludicrous.”

Grace also said the relative sizes of Power and AutoPacific are not at issue. Power “has to ensure that the materials are not going to be used in an anti-competitive way,” Grace said.

Peterson, a former planning manager and engineer at Ford Motor Co., joined Power in 1983, where he became vice president of automotive programs. But in late 1985, Peterson said he and several others were laid off when Power went through a restructuring.

Pondering his next step, Peterson developed what would become AutoPacific’s first major product: “The Competitive Battleground,” a comprehensive yet easy-to-read overview of the car industry’s strategies for the next five years.

“I walked into peoples’ offices and said, ‘I don’t know if I want a job or if I want to sell you this,’ ” Peterson recalled. He chose the latter and launched AutoPacific in 1986.

“The Competitive Battleground,” published quarterly, costs $9,000 to $10,000 a year, said Peterson. AutoPacific also sells a companion forecasting guide--costing about $17,500 a year--that analyzes every vehicle sold in the industry and its five-year outlook.

For instance, if the firm were evaluating Ford’s minivan, it would find out “exactly where it’s going to be produced, when it’s going to be produced, to determine what the plant capacities are going to be, and to provide assessment of the strategic implications for other vehicles in the Ford lineup,” Peterson said.

AutoPacific’s research is sold to U.S. car makers, the American arms of Japanese and European makers, auto-parts distributors and advertising agencies, he said. Peterson’s six full-time employees--Power has 150--operate out of a house AutoPacific owns.

Joel Pitcoff, Ford’s manager of research and analysis, said the auto maker buys AutoPacific’s analyses even though Ford relies mostly on its own staff for forecasting trends. “You can’t afford to let yourself become too dependent on a single source,” he said.

Like Power, AutoPacific evaluates individual vehicles for manufacturers--proprietary research that the public never hears about. Its focus groups, clinics and mail and telephone surveys are aimed at gauging the public’s reaction to certain models.

It asks for drivers’ opinions about a car’s outside and inside styling, its performance and how it stacks up to rival cars in its class. Sometimes this is done by lining up different cars and asking respondents to make comparisons.

This is different from the customer-satisfaction research that Power does, which involves asking car owners how they like the cars they already drive.

Not surprisingly, Power provides similar services to the non-customer-satisfaction car ratings that AutoPacific offers. Which begs the question: What does AutoPacific offer that Power doesn’t?

Peterson said AutoPacific has more detailed knowledge of each car and truck and their sales prospects, presented in a more simplified form.

“The auto industry is very big. It has a tremendous need for information presented in a way that the companies can use,” he said.

Patricia Patano, marketing director for special projects at Power, said, “I’m surprised they’d make that kind of statement, given that they don’t know what we’re doing at present.” Regardless, car makers are reading AutoPacific’s research, along with studies by Power and other car researchers such as Autofacts of West Chester, Pa.

“Each one offers certain strengths,” said Tom Rossi, a spokesman at Mazda’s U.S. marketing headquarters in Irvine. Mazda’s researchers, he said, believe that “AutoPacific seems to be a little better on product-specific stuff,” meaning research on individual cars.