In a battle between two major plastics compounders, DSM Engineering Plastics Inc. has agreed to stop production and sales of its long-fiber-reinforced thermoplastics in return for the dismissal of a lawsuit filed by LNP Engineering Plastics Inc.
LNP of Exton, Pa., claimed Evansville, Ind.-based DSM had violated three patents covering LNP's Vertron-brand long-fiber-reinforced thermoplastics, which are used in such applications as automotive bumper beams and dashboard panel supports.
As part of the settlement, DSM Engineering Plastics will discontinue manufacturing and selling the composites in question by Jan. 1.
LNP had filed a suit in U.S. District Court in Wilmington, Del., late last year seeking financial compensation from DSM, as well as from Polymer Composites Inc. and RTP Co., both of Winona, Minn.
Neither LNP nor DSM would
release the terms of the settlement.
Robert Schultz, LNP chief executive officer, said the settlement is important to LNP.
Long-fiber-reinforced thermoplastics, which typically are based on nylon or polypropylene, ``are a specialty niche business, but for a company like LNP, they consist of a significant part of our forward strategy,'' Schultz said in an Aug. 11 telephone interview.
``This settlement allows us to cut losses on both sides,'' he added.
DSM Engineering Plastics agreed to the settlement to avoid having a negative impact on its customers and the overall engineered plastics market, according to Tony DeVrught, vice president of marketing and sales.
Long-fiber-reinforced thermoplastics made up less than 10 percent of DSM's business and had shown less growth than the company's other products, according to DeVrught.
Schultz noted that the materials are becoming more important to LNP as industries look for structural metal replacements instead of functional metal replacements.
Improved long-fiber-reinforced thermoplastics, with better load-bearing ability and strength, are filling that need in automotive, sporting goods and general industrial markets, according to Schultz.
LNP's suits against Polymer Composites and RTP remain active. Schultz said LNP is hoping to settle with those companies as well.
RTP officials are reviewing the claim and have taken no formal action, according to marketing communications manager Ray Leaf.
Officials at Polymer Composites, a division of Hoechst Celanese Corp., previously said the company would defend its position and expected to prevail in the suit.
Hoechst public relations manager Frank Santana said both sides ``are talking,'' but that Polymer Composites has no further comment on the matter.
LNP is a division of Kawasaki Steel Corp. of Tokyo. The company's overall 1996 sales were $200 million, but Schultz declined to reveal how much of that came from long-fiber-reinforced thermoplastics.
DSM is a division of DSM NV, a European plastics leader based in Heerlen, the Netherlands. The engineered plastics division posted global sales of $400 million in 1996.