AVG and AutomationDirect in Legal Battle

A legal dispute between two direct-sales suppliers of automation products became public recently, when AVG Automation (www.avg.net) and AutomationDirect (www.automationdirect.com) both issued press releases describing litigation involving alleged improprieties by the other.

On Oct. 18, Bettendorf, Iowa-based AVG said it filed suit in federal court in Illinois in September 2005 against Cumming, Ga.-based AutomationDirect.com Inc., its chairman, Timothy Hohmann, and its Japanese parent, Koyo Electronics Industries Co. Ltd., contending that AutomationDirect secretly developed a new touch panel during the period of its partnership with AVG, in violation of its obligations to AVG. AVG alleged the AutomationDirect panel to be a “knock-off” of an AVG design.

AutomationDirect responded with an Oct. 20 press release, stating it believes the AVG lawsuit to be without merit, and that it intends to prove that in court. AutomationDirect also said it filed a lawsuit in federal court in Atlanta in April 2005 against AVG’s EZAutomation division (www.ezautomation.net), alleging trademark and copyright infringement, as well as false and deceptive advertising. AutomationDirect said that it had previously refrained from making any details of this earlier lawsuit public “since legal issues should be handled in court and not in other venues.”

In other news, AVG announced that it will expand its EZAutomation business in the first quarter of 2006 with 10 new product lines, including sensors, encoders, time delay relays, counters, power supplies and other products. AVG President and Chief Executive Officer Shalli Kumar said EZAutomation will become a full automation supplier, offering “price buster” automation products, including unique features at low price points.

In addition, Kumar announced the acquisition of Genius Automation, one of India’s largest system integrators and automation distributors, with 100 employees headquartered in Bangalore.

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