Honeywell International Inc.’s (HON - Free Report) Turbo Technologies business and BorgWarner Turbo Technologies has settled their patent dispute regarding cast titanium compressor wheels used in select commercial vehicle applications. As per the agreement, Honeywell will be paying $32.5 million for a paid-up license to BorgWarner's asserted patents. Other conditions of the settlement were not disclosed.
Though Honeywell was ready to fight its position in the District Court for the Western District of North Carolina, it decided not to as the settlement was made at a much lower amount than the damages of more than $100 million sought by BorgWarner. Preliminary examination by the U.S. Patent Office of the three BorgWarner patents in dispute showed them to be invalid.
Honeywell’s short-cycle businesses as well as its commercial aerospace spares and residential and commercial retrofit businesses are performing impressively well and are expected to support future growth outlook of the company. First-quarter 2011 was the eighth consecutive quarter in which orders in short-cycle businesses have increased. The company’s long-cycle backlog continued to be at near record levels.
Based in Morris Township, N.J., Honeywell International Inc. is a Fortune 100 company providing technical and manufacturing support to customers worldwide with aerospace products and services; control technologies for buildings, homes and industry; automotive products; turbochargers; and specialty materials. The major competitors of Honeywell are BorgWarner Inc. (BWA - Free Report) , United Technologies Corp. (UTX - Free Report) and Johnson Controls Inc. (JCI - Free Report) .
We currently maintain our Neutral rating on Honeywell, with a Zacks #2 Rank (Buy recommendation) over the next one to three months.