Packard Bell Makes Payment, Freeing Laptops Held Hostage

Packard Bell NEC made an undisclosed payment to Irvine-based Cerplex Group on Wednesday and retrieved hundreds of customers’ laptop computers held hostage during a dispute between the companies.

“They fulfilled their obligation under the agreement we signed, and the trucks are being loaded right now,” Cerplex President Dick Alston said.

The dispute stems from what Cerplex says are unpaid bills to Packard Bell for repair work dating back more than six months. Packard Bell says it is trying to resolve the accounting before the fight gets to court.

Cerplex had stopped work on and refused to release about 400 NEC Ready laptops it had been repairing under contracts with Sacramento-based Packard Bell and Taiwanese manufacturer Alpha Top, which made the model for Packard Bell.

Cerplex says Packard Bell owes more than $200,000 for back repairs, an amount that Packard Bell contests. Wednesday’s payment covers a piece of the total while negotiations continue, Alston said.

Packard Bell said the owners of the 90 finished laptops should begin getting them back soon. “They’ll start to get them in a matter of days,” spokesman Ron Fuchs said.

After the others are fixed by Packard Bell, “everyone should have the units, we think, within two weeks.”

Packard Bell customers have been frustrated as the squabble escalated, with some complaints being referred from one company to the other and back again.

Alston said his company’s relationship wasn’t with consumers but only with the manufacturers.

And the major problem is with Packard Bell, he said. Cerplex gave The Times a copy of an e-mail message apparently sent by a Packard Bell official to Cerplex this summer, in which Packard Bell promised to pay some Alpha Top bills after the Taiwan company fell into arrears.

Fuchs refused to comment on that arrangement. He said Alpha Top made 50,000 laptops for Packard Bell, most of which were sold in the last quarter of 1998 and the first quarter of this year.

Under the warranty that came with the machines, Alpha Top promised to repair any computers with problems, and it arranged with Cerplex for the work. For repairs past the warranty, Packard Bell arranged for work at the Cerplex’s Livermore, Calif., facility.

Alpha Top ran as much as $500,000 behind on its bills, prompting an earlier freeze on repairs and the July pledge from Packard Bell to pay later invoices, Alston said.

Packard Bell has its own outstanding bills with Cerplex dating as far back as April, Alston said. Cerplex seized the laptops in retaliation about 10 days ago.

Packard Bell, which is owned by NEC Corp. of Japan and Groupe Bull, has been losing money from price-cutting in personal computers.

Cerplex has lost money in each of the last four years. It also contracts to fix machines for several other major technology manufacturers, including Sun Microsystems and Cisco.

Cerplex shares were unchanged Wednesday at 75 cents on the Nasdaq Bulletin Board.