Power City Electric Inc., a longtime Spokane electrical contracting company, is embroiled in a court battle with a rival company formed three months ago by two former employees. It has accused the new company of using confidential information to cripple its ability to serve existing customers or to obtain new customers.


The start-up company, Mountain States Electrical Contractors Inc., contends that the civil lawsuit brought against it by Power City is frivolous and intended to harass. It argues that any damages Power City may have incurred as a result of Mountain States formation are unrelated to the conduct of Bruce Farley and Bruce Carter, the two former Power City employees named as defendants in the lawsuit, and were caused solely by Power Citys negligence.


Carters position as project manager for Power City was terminated last September, according to court documents. Farley later quit his job as controller for Power City so he could join Carter in forming Mountain States, which is located at 208 N. Crestline. Farley is president of the company.


Power City filed the suit in Spokane County Superior Court last November, asking for an injunction that would prevent Farley and Carter from improperly using confidential customer lists to establish a competing business and also from trying to hire current Power City employees.


Bruce Gore, Mountain States attorney, denies Power Citys allegations, and asserts that Power City has failed in recent depositions to substantiate any damages.


We believe the case has been reduced to virtually nothing, he says.


The two parties agreed to an injunction handed down by Superior Court Judge Robert Austin in November, although Gore says Mountain States will attempt to have the entire restraint thrown out.


The ruling forbade Mountain States from contacting or recruiting current Power City employees for 12 months. Mountain States also was prohibited from contacting or performing any work for 14 Power City customers scattered throughout the Pacific Northwest for six months to a year, depending on the customer, unless they end their relationships with Power City.


The court also ordered Farley and Carter not to use any other confidential information gathered while they were employees of Power City, including the use of its marketing and business strategies.


Farley and Carter denied contacting former Power City employees while those employees were still with Power City. Gore claims that several Power City employees, including some who are now with Mountain States, were disillusioned with Power Citys management tactics and were in the process of leaving anyway.


We have shown that any of the people hired at Mountain States were already heading for the door, he says.


Power City says in court documents that six employees left the company soon after Mountain States was formed. It alleges that one of its clients offered a $300,000 lighting job to Mountain States shortly after a Power City employee heavily involved in negotiations for that job quit and was hired by the new company. Mountain States contends it was awarded that bid in open competition.


A trial date hasnt been set. Thomas Bassett, Power Citys attorney, says that company may seek monetary damages for lost contracts, but a dollar amount hasnt been determined. Power City is a 59-year-old company that does work throughout the Northwest.