Pacific Scientific Co. Settles Breach-of-Contract Suit
Just three weeks after vowing to “vigorously defend itself against this action,” Pacific Scientific Co. said Thursday that it has settled a breach-of-contract lawsuit arising from its sale of a line of mechanical seals.
The Newport Beach-based maker of electronic measuring equipment declined to disclose the exact amount of the settlement with Texas-based Accuflex Inc. but said it would reduce third-quarter earnings by about 10 cents a share. That would equal about $542,000.
Accuflex had sought actual damages of $7 million and punitive damages of $70 million.
Pacific Scientific officials said the settlement involved no admission of liability by the company and they continue to maintain that the suit was without merit.
The company sold the mechanical seal line, produced by a Pacific Scientific division, to Accuflex in 1990 for $200,000 and later sold other assets of that same division to John Crane Inc., an Accuflex competitor.
In its breach-of-contract suit, Accuflex named both Pacific Scientific and John Crane Inc., alleging that the sale to John Crane violated a non-competition agreement executed when Pacific Scientific sold Accuflex the product line.