Car Research Firms End Legal Battle : Automobiles: The J. D. Power lawsuit accused defecting analysts and AutoPacific of using its information. The case is settled out of court.
A legal battle between two of the nation’s leading car research firms, J. D. Power & Associates and AutoPacific Group Inc., has been settled out of court.
The settlement announced last week ends a lawsuit that Power, based in Agoura Hills, had filed against Santa Ana-based AutoPacific and two of its analysts, Christopher W. Cedergren and Steven L. Morrison. Both Cedergren and Morrison used to work for Power.
Power filed the suit in November, 1991, in Los Angeles Superior Court, and it alleged that when Cedergren and Morrison quit Power to join AutoPacific earlier that year, they had taken confidential Power documents and other data and used the information in AutoPacific’s research.
The defendants had denied the allegations in the suit, which had sought at least $750,000 in damages.
Specific terms of the settlement were not disclosed, although Power said the court would enter a judgment in Power’s favor that bars AutoPacific from using any Power information in AutoPacific’s reports.
“Of course, such a stipulation was always agreeable to AutoPacific since we never used proprietary information belonging to J. D. Power & Associates in any of our forecasts and never would,” AutoPacific said in a statement.
AutoPacific also agreed to pay certain of Power’s court costs, which were not disclosed, but those costs do not include Power’s attorney fees. Both firms are privately held.
Power’s founder and president, J. David Power III, said in a separate statement that his firm was “happy” with the settlement.
“We initiated this suit reluctantly and out of necessity to protect our valuable intellectual property rights,” he said.
Power, with about $20 million in annual revenue, is 10 times larger and much more well-known than AutoPacific, which was formed in 1986. Power is particularly known for its customer satisfaction surveys of new cars, with many of the results reprinted in car advertisements, while AutoPacific focuses on selling research meant for the industry’s eyes only.
After Power filed its suit, AutoPacific President George C. Peterson asserted that Power, smarting from Cedergren’s defection, was using the suit to financially destroy AutoPacific because his firm has become another respected voice in auto research. Power denied the claim.
In announcing last week’s settlement, AutoPacific said that “notwithstanding J. D. Power efforts to silence AutoPacific Group and simply put us out of business, we have survived and gotten stronger.”
Peterson, himself a former Power analyst, said his company spent more than $250,000 on legal fees defending itself against the suit.
