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PacifiCorp may pay more millions for trade secret theft

Published May 25, 2012 11:09 pm

Court • USA Power of Dallas believes it is entitled to an additional $267 million as punitive damages.
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PacifiCorp may end up paying a lot more than $134 million for stealing trade secrets from a Texas company and using them to construct its Currant Creek power plant near Mona.

USA Power of Dallas, acting through its Salt Lake law firm, has returned to Utah's 3rd District Court, asking Judge Anthony Quinn to award it an additional $267 million, or double the $134 million a jury awarded last week after it found PacifiCorp stole the trade secrets and unjustly profited from the theft.

PacifiCorp does business in Utah under the name of Rocky Mountain Power.

In a new motion, USA has told the court it believes it is entitled to the additional $267 million as punitive damages under Utah law, because the jury found that PacifiCorp "willfully and maliciously" stole its trade secrets and tried to cover up its wrongdoing.

"PacifiCorp is a Goliath with unlimited resources that it spent freely to avoid responsibility for its misconduct," USA said in its motion .

After a five-week trial, a jury last week awarded USA $21.4 million in damages against PacifiCorp for stealing its trade secrets. It also awarded an additional $112.5 million in damages because PacifiCorp unjustly profited from the theft. USA is represented by attorneys Peggy Tomsic, James Magleby and Eric Schnibbe of the Salt Lake law firm of Magleby & Greenwood.

Pacificorp, meanwhile, has said it disagrees with the verdict and will ``pursue all avenues of appeal.''

USA's dispute with PacifiCorp reaches back to 2002.

At that time, USA acting though its Spring Canyon Energy subsidiary, approached PacifiCorp about building a natural gas fired power plant in Juab County. Once that plant was built, USA planned to sell it to PacifiCorp.

As part of the negotiations, USA required PacifiCorp to sign a nondisclosure pact before it would allow the utility to review the inside design and engineering details for its proposed Spring Canyon plant.

Six months later, PacifiCorp cut off talks, indicating it wanted to put the project out to bid. And on Nov. 3, 2003, PacifiCorp award the project to itself and then later received approval to build the plant from the Utah Public Service Commission.

PacifiCorp built its Currant Creek plant less than one mile away from the site proposed by USA Power. The Texas company said that the Current Creek facility had characteristics that were virtually identical to those of its own proposed plant.

In its motion filed Thursday, USA argues that unless the court awards it substantial punitive damages, that PacifiCorp 's theft would have been worth it — even with the $134 million award by the jury. And it noted that PacifiCorp has estimated that it expects to generate gross revenue of over $7 billion from Current Creek over the life of the plant, with more than $1 billion in operating profit and over $653 million in taxable profits.

PacifiCorp said it had no further comment beyond its statement last week following the jury's ruling.

In that statement, PacifiCorp termed its dispute with USA as "longstanding," noting that the events surrounding the case took place from 2002 to 2004, prior to PacifiCorp being taken over by billionaire Warren Buffett's MidAmerican Energy Holding Co.




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