Jury levels $134 million fines against PacifiCorp for misappropriation of trade secrets

Published: Tuesday, May 22 2012 9:18 p.m. MDT

PacifiCorp's Blundell geothermal power plant near Milford, Beaver County, came online in 1984 and was the first in the country outside of California. A new report released by the Geothermal Energy Association indicates Utah continues to be a strong player in the geothermal industry, with 11 projects in development this year.

Rocky Mountain Power

SALT LAKE CITY — A jury has leveled a $134 million fine against the owner of Rocky Mountain Power, deciding that the regional electric utility intentionally and maliciously misappropriated trade secrets from a Texas power-plant developer.

The 3rd District Court verdict this week has been years in the making, as Dallas-based USA Power Partners filed its initial suit against PacifiCorp in 2005, after PacifiCorp began construction of an air-cooled natural gas-fired power plant in Mona, Juab County.

The dispute centered on USA Power's contention that the plant design, which aimed to operate more efficiently while causing fewer environmental impacts, had been its brainchild.

PacifiCorp said in a statement Tuesday that it disagrees with the verdict in the "longstanding dispute" and "will aggressively pursue all avenues of appeal."

According to the verdict, PacifiCorp must pay damages totaling nearly $18.2 million, along with $112.5 million for its unjust profits resulting from the use of confidential information. Local law firm Holme Roberts & Owen and attorney Jody Williams were also found liable for more than $3.2 million, for breaching their fiduciary duties to USA Power, which had previously been their client.

Williams and the law firm of Holme Roberts & Owen, which merged with Bryan Cave LLC, refused to comment on the court's decision.

"The fight is not over yet, but we have a jury who believed in us and it was unanimous," said Salt Lake City attorney Peggy Tomsic, lead counsel for USA Power.

USA Power had originally planned to build its Spring Canyon plant in Mona, but intended to sell the finished product to PacifiCorp. Negotiations dragged on for more than a year and PacifiCorp chose to build the plant itself after reviewing more than 100 bids — including USA Power's — for the $350 million facility it called Currant Creek.

The plant fired up in June 2005 and was situated a mile from the USA Power-proposed site, but matched the description and specifications of the one USA Power had planned to build, according to the suit.

"Without misappropriating protected confidential information and trade secrets that USA Power provided to PacifiCorp and Williams, PacifiCorp could not have independently designed or 'reverse engineered' Spring Canyon in the form of Currant Creek," the 2005 complaint states.

USA Power won the case by summary judgment in 2007. But that decision was reversed by the Utah Supreme Court in 2010 and a jury trial ensued, beginning April 9. The jury rendered its unanimous verdict Monday.

"It is a huge milestone," Tomsic said. "To have eight people who have nothing to do with us sit through almost six weeks of a jury trial and believe my clients and my clients' witnesses and come back with a verdict in less than four hours speaks volumes."

At the initial filing, USA Power, parent company of Spring Canyon Energy in Utah, had three employees, one of which was a key witness who died before the case went to trial but whose deposition was played posthumously during trial via video recording.

USA Power still exists but has halted operation, as the Mona plant was its main development at the time.

PacifiCorp operates three power and energy subsidiaries, serving approximately 1.7 million customers in the northwestern United States.

"I would hope, at this point, that PacifiCorp would do the right thing and let my clients get on with their lives," Tomsic said, adding that USA Power has "waited a very long time for justice."

E-mail: wleonard@desnews.com

Twitter: wendyleonards

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