Honeywell Is Ordered to Pay Litton $250 Million

A federal jury ordered Honeywell Inc. on Wednesday to pay $250 million in damages to Litton Industries Inc. for monopolizing the market in laser gyroscopes used aboard commercial aircraft.

If the verdict stands, those damages would triple to $750 million in accord with U.S. antitrust law.

The jurors’ decision was a stunning victory for Litton, exceeding by $16 million a previous award to the Woodland Hills-based company that was thrown out by the presiding judge in the case two years ago.

Honeywell claimed it owed Litton $22.3 million.

Thomas Nolan, Litton’s lead attorney, hailed the verdict as a “total vindication” of Litton’s claims against its rival and “a very strong statement from the jury” against Honeywell business practices.

Honeywell’s chief trial lawyer, Bob Cooper, said an appeal would be filed.

The nine-member jury deliberated less than a day after hearing five weeks of highly technical testimony from a slew of witnesses called by both sides. The quick verdict surprised the case’s lawyers.

The only issue before the jury was how much Minneapolis-based Honeywell should pay, but arriving at the amount was no simple task. Each side presented complicated formulas, buttressed by testimony from academic and industry experts, for arriving at a figure.

In the previous trial, a jury awarded Litton $234 million after finding that Honeywell had engaged in illegal trade practices. U.S. District Judge Mariana Pfaelzer upheld that verdict but threw out the award, declaring that the formula used for assessing damages was flawed.

Litton argued in that trial that Honeywell signed contracts with aircraft builders making Honeywell an exclusive supplier and imposing onerous financial penalties if the manufacturers bought Litton’s gyroscope.

Honeywell responded that its gyroscope was better made and more reliable, earning it a higher market share.

The device, housed in a nondescript box inside an airplane, costs about $75,000 and uses mirrors, sensors and other components to help a pilot plot position, speed and altitude. Many airliners carry three laser gyroscopes to provide backup in the event of failure.

While the company’s legal team was understandably jubilant after Wednesday’s verdict, Litton Senior Vice President John E. Preston reacted with restraint, calling the decision “another step in our efforts to get redress from Honeywell’s illegal monopolization.”