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SOURCE LoJack Corporation
-- Arbitration Panel Upholds Several Key LoJack Counterclaims
-- Further Hearing Will Determine Amount of Damages Owed to LoJack
-- Decision Reaffirms LoJack Right to Terminate License Agreement
CANTON, Mass., May 13, 2014 /PRNewswire/ -- LoJack Corporation (NASDAQ: LOJN) today announced that an arbitration panel has dismissed all claims filed against the Company by Tracker do Brasil LTDA (Tracker), the exclusive licensee of the LoJack Stolen Vehicle Recovery technology in Brazil. In its binding decision, arbitrators from the International Centre for Dispute Resolution of the American Arbitration Association also upheld several of LoJack's counterclaims against Tracker for violating the terms of its license agreement, breaching the implied duty of good faith and fair dealing, and engaging in unfair competition. The panel now will conduct a further hearing to determine the amount of an award of damages owed to LoJack.
"This decision is a significant legal victory for LoJack and its shareholders," said Randy Ortiz, LoJack's Chief Executive Officer and President. "The ruling demonstrates that Tracker's claims against the Company were without merit, and allows us to pursue damages against the licensee for the substantial economic harm caused by its breach of contract and unlawful use of our intellectual property and confidential information in the marketplace. Equally important, the decision affirms that the Company acted legally, fairly and in good faith in its dealings at issue with the licensee."
"The management team has worked diligently during the past two years to eliminate the expense and uncertainty of continued litigation," Ortiz said. "With the liability phase of this case now behind us, we look forward to fully concentrating our resources on pursuing strategic business opportunities, including our new telematics solutions, and achieving our long-term performance objectives."
The arbitration case stemmed from a contractual dispute between the parties that began in March 2011. In its 81-page decision, the arbitration panel dismissed all eight of Tracker's claims, including those for intentional misrepresentation, negligent misrepresentation and breach of contract. Tracker had sought $55 million in actual damages, which could have been tripled by the arbitration panel, plus legal fees.
LoJack's counterclaims for breach of contract and breach of implied duty of good faith and fair dealing were upheld in part. The panel ruled that Tracker has been making unauthorized use of LoJack's trademarks, copyrights, technology and other confidential information to advertise, lease, sell or market non-LoJack products, representing them to the public as LoJack products.
The panel found that the unauthorized use of LoJack's intellectual property and confidential information caused LoJack to suffer damages to its reputation, in addition to other damages.
The panel also upheld LoJack's counterclaim that Tracker engaged in unfair competition, ruling that in addition to its use of LoJack's trademarks/trade names and copyrights to sell non-LoJack products, Tracker passed off non-LoJack products as LoJack products. The arbitrators found that this conduct did deceive or likely could deceive customers into believing that they were buying a LoJack product when they were not.
Because Tracker failed to meet its minimum unit purchase requirements for vehicle location units under the license agreement, the panel further concluded that LoJack has the right, based on such failure, to terminate the License Agreement upon the giving of 60 days written notice to Tracker.
"The decision gives us the right to explore other avenues for re-entering the Brazilian market, and we certainly plan to take advantage of the opportunity to assess our options," Ortiz said.
About LoJack Corporation
LoJack Corporation, the company that has helped more than nine million people protect their vehicles in the event of theft over the past 25+ years, today provides safety, security and protection for an ever-growing range of valuable assets and people. Leveraging its core strengths, including its well-known brand, direct integration with law enforcement and Dealer distribution network, LoJack Corporation is expanding into new areas across the continuum from theft deterrence to recovery. The Company is focusing on creating a new level of value for its Dealer, customer and investor communities by delivering innovative offerings and multiple technologies in expanding geographies. For more information, visit www.lojack.com, www.autotheftblog.com, www.youtube.com/lojack, www.twitter.com/LoJackCorp,or www.Facebook.com/LoJackCorp.
Safe Harbor Regarding Forward Looking Statements
From time to time, information provided by the Company or statements made by its employees may contain "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws, which involve risks and uncertainties. You can identify these statements by use of the words "assumes," "believes," "estimates," "expects," "will," "intends," "plans," "projects" and similar expressions that do not relate to historical matters. Any statements in this news release that are not statements of historical fact are forward-looking statements, including, but not limited to, statements concerning (a) the outcome of the arbitration hearing to assess damages owed by Tracker do Brasil LTDA, (b) the Company's relationship with its licensee in Brazil or the potential termination by the Company of the license agreement between the parties, and (c) the Company's strategic initiatives, investments and plans for growth and future operations. Such forward-looking statements are based on a number of assumptions and involve a number of risks and uncertainties, and accordingly, actual results could differ materially. Factors that may cause such differences include, but are not limited to: (1) the outcome of ongoing litigation involving the Company, including the damages phase of the arbitration with Tracker do Brasil LTDA; (2) the Company's future relationship with Tracker do Brasil LTDA or ability to re-enter the Brazilian market; (3) the continued and future acceptance of the Company's products and services, including the Company's pre-install program and fleet management and other telematics products; (4) the Company's ability to obtain financing from lenders; (5) the rate of growth in the industries of the Company's customers; (6) the presence of competitors with greater technical, marketing, and financial resources; (7) the Company's customers' ability to access the credit markets, including changes in interest rates; (8) the Company's ability to promptly and effectively respond to technological change to meet evolving customer needs; (9) the Company's ability to successfully expand its operations, including through the introduction of new products and services; (10) changes in general economic or geopolitical conditions, including the European debt crisis; (11) conditions in the automotive retail market and the Company's relationships with dealers, licensees, partners, agents and local law enforcement; (12) the expected timing of purchases by the Company's customers; (13) the Company's ability to achieve the expected benefits of its strategic alliance with TomTom; (14) the Company's ability to maintain the strength of its brand; and (15) trade tensions and governmental regulations and restrictions in Argentina and the Company's other international markets. For a further discussion of these and other significant factors to consider in connection with forward-looking statements concerning the Company, reference is made to the Company's Annual Report on Form 10-K for the year ended December 31, 2013 and the Company's other filings with the Securities and Exchange Commission.
Readers should not place undue reliance on any forward-looking statements, which only speak as of the date made. Except as required by law, the Company undertakes no obligation to release publicly the result of any revision to the forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
Donald R. Peck
©2012 PR Newswire. All Rights Reserved.
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