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A settlement was reached April 1 between Ford Motor Company and LKQ Corporation in a lawsuit filed by Ford Motor Company to protect its design patents on collision parts. The settlement mandates that LKQ will not challenge the validity and enforceability of Ford’s design patents during the term of the agreement, and LKQ will be the sole non-OEM distributor of copies of Ford collision parts.
The settlement ends two legal actions: the first involving replacement collision parts for Ford’s F-150 pickup truck, which had advanced to the Federal Circuit Court of Appeals; the second involving replacement collision parts for the Ford Mustang, which was before the U.S. International Trade Commission (ITC). Details about the agreement are confidential and will not be disclosed.
As the only distributor of non-OEM aftermarket copies of Ford collision parts protected by design patents, LKQ will pay Ford a royalty for each such part sold during the agreement’s term, which extends through Sept. 30, 2011. The agreement is subject to renewal upon mutual agreement of Ford and LKQ.
“The settlement protects U.S. jobs and provides consumers with choices when repairing their vehicle," said Darryl Hazel, president, Ford Customer Service Division (FCSD).
Hazel noted that both companies benefit from the deal because competition in the market will continue, since both OEM and aftermarket version of collision parts are available. He added that FCSD and LKQ will work together to stop infringement of Ford’s design patents.
Hazel stressed that the settlement does not endorse the quality or use of non-OEM aftermarket replacement parts sold by LKQ Corporation.
“The agreement we reached is beneficial to both Ford and LKQ,” said Joseph Holsten, president and CEO of LKQ. “As the sole distributor of new non-Original Equipment aftermarket parts protected by Ford design patents, we will have the sole right to sell these parts in the United States for all of Ford’s models.”