Thermax Settles Dispute with Purolite

Its done finally...

Thermax has entered into an amicable settlement with Purolite International ending an outstanding legal dispute regarding its ion exchange resin business in the US. As per this out-of-court settlement, Thermax will pay Purolite four installments of USD 9.5 million each, spread over the calendar year to settle the litigation.

The two parties will now be joint co-owners in perpetuity of the information and technology in dispute. The agreement permanently resolves all claims and counterclaims. There will be no further financial obligations on this account. While the terms of the agreement are confidential between the two parties, Thermax is following all norms of corporate disclosure and has promptly informed the stock exchanges where it is listed.

Thermax had been regularly reporting the lawsuit in its annual reports, but decided not to make any further public statement as the matter was sub judice. On the basis of the facts of the case, report from a renowned technical expert in the US and feedback from its US attorneys, the company did not expect any serious liability from this case. The case, involving a series of inter-related claims and counterclaims, was to be judged at a jury trial in March in a US district court.

However, there was an unexpected turn of events last month, where the US district court passed an order that three production processes (for certain kinds of ion exchange resins for applications in water treatment) in dispute, constituted Purolite`s trade secrets. Thermax then evaluated its options: One, to continue with its defense at the jury trial and beyond, by way of filing an appeal, should that trial be unfavourable or, two, to resolve the matter out of court.

The board of directors along with the management leadership team chose the latter option after taking a long-term view of potential risks of significantly higher liabilities, given the uncertainties associated with jury trials, as well as the costs and time involved in protracted litigation. Thermax has tremendous growth opportunities; and therefore the decision was to settle this at a level that is less significant as compared with its future growth prospects.

Thermax is confident that, given the situation, this decision is in its best interest. Beyond a one-time impact on the balance sheet, the settlement paves the way for Thermax to move on and focus on growing and strengthening its energy and environment business.

So..it ends!!!:)