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November 11, 1996 01:00 AM

ARBITRATOR SETTLES PULTRUDERS' SQUABBLE

Bill Bregar
Senior Staff Reporter
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    Binding arbitration may have ended their technology dispute, but Canadian pultruders Omni-glass Ltd. and Inline Fiberglass Ltd. keep sniping at each other in a battle over composite windows. The firms originally sued each other, but both firms agreed to take their dispute to arbitration. Arbitrator Gordon Murphy ruled on two cases earlier this year.

    In what amounted to a split decision, Inline of Concord, On-tario, won one case and Omni-glass of Winnipeg, Manitoba, won the other. Although neither company would reveal the amount of damages ordered, officials from both companies agreed that Omniglass ended up paying a relatively small amount of money.

    ``It was almost a wash,'' Omniglass President Laurie Davies said.

    But Inline's victory on its case, which stemmed from a 1989 licensing agreement between the two companies, frees the company to start selling its fiber-reinforced window and door profiles in the United States, according to Rino Sabatino, Inline's president and chief executive officer. Inline pultrudes the windows at its headquarters plant in Concord.

    ``We have lined up a multinational corporation to distribute the products in the United States,'' Sabatino said, declining to name the company.

    Pultruded windows frames, although they offer strength, still are rare in the United States, mainly because of their high price. But Sabatino said manufacturing innovations by Inline have lowered the cost.

    ``We are now price-competitive'' with other window materials such as wood and vinyl, he said in a telephone interview.

    The arbitration case that Inline won involved a 1989 agreement in which Omniglass licensed its technology to Inline to pultrude fiber-reinforced plastics profiles. But Inline charged that the technology did not work, and stopped using the Omniglass process in 1990. Inline terminated the license. Inline also accused Omniglass of selling its defective dies. Murphy agreed with Inline's position and awarded damages to Inline. According to Inline, the ruling also said the Inline process ``is not derivative in any way from Omniglass technology.''

    In the other case, Murphy agreed with Omniglass, ordering Inline to pay royalties to Omniglass for supplying technology similar to the licensed Omniglass technology to a company in Russia. That case concluded June 25.

    The name of the Russian company was not available.

    Both firms issued news releases about the arbitration results. In the releases, each company highlighted the case it won and ignored the one it lost.

    Inline's release said Murphy ruled that Inline's system is capable of using a significantly higher glass loading to produce windows with a higher stiffness and strength - a point strongly disputed by Omniglass officials.

    ``I don't agree with that at all,'' Davies said.

    Another Omniglass official said Inline's claims of higher glass loading, and a stronger window, are exaggerated. Beyond a certain point, higher glass content in thin-wall window profiles does not add significant strength, he said.

    The business relationship between the two Canadian firms, which dates to the late 1980s, used to be rosier. Both Inline and Omniglass were involved with pultrusion technology with PPG Industries Inc. of Pittsburgh. When PPG discontinued its FRP window activity, Inline became a licensee of Omniglass. That agreement fell apart and the legal disputes followed.

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