BBA pays out pounds 12m to settle patent case

BBA, the engineering components group that announced provisions of pounds 60m earlier this year, is paying out pounds 12.8m to settle a United States patent dispute that began in the early 1980s, writes Russell Hotten.

A claim for punitive damages against the company was due to go before a Californian court within weeks. BBA was expected to fight the case but new information came to light and Roberto Quarta, chief executive, said the out-of-court settlement was to avoid further expense and management time.

In March BBA announced 2,000 job cuts and restructuring to cope with the depressed conditions in the European automotive sectors. The write-offs meant BBA turned a 1992 profit of pounds 47.4m into a 1993 loss of pounds 12.8m.

The patent case was brought by Tilton Engineering, which claimed that BBA's subsidiary Automotive Products had infringed patents for a racing car clutch. AP supplies most of the world's main racing teams.

The company had already made provisions of pounds 1m for legal costs in last year's accounts.