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AK-Novelis suit accents steel vs. aluminum fight

Mar 03, 2014 | 06:49 PM |

Tags  steel, AK Steel, Novelis, aluminum, Ford Motor, automotive, noncompete, Catherine Ngai

NEW YORK — A lawsuit filed by AK Steel Corp. against Novelis Corp. and a former employee highlights the ongoing fight between steel and aluminum interests for market share in the automotive industry.

A temporary restraining order has been issued by U.S. District Court in Ohio against Novelis and Thomas Miskovich, a former AK Steel automotive sales employee who moved to the aluminum producer in January.

The March 3 order came one week after West Chester, Ohio-based AK Steel filed a lawsuit against Miskovich for allegedly violating a noncompete contract and against Novelis for alleged tortious interference. Miskovich was employed by AK Steel for 16 years, most recently as a sales manager in the company’s automotive carbon steel division, particularly responsible for sales to Dearborn, Mich.-based Ford Motor Co., a "significant customer" for AK Steel, according to court documents.

AK alleged that Miskovich’s move to Novelis would hurt the steel company because he knew confidential information, including pricing and sales strategies.

Atlanta-based Novelis responded in a court filing that it sells aluminum—not steel—to automotive manufacturers, so the companies are not competitors, and noted through an affidavit by Miskovich that he was not involved in steel pricing. The producer also said that Ford "separates its steel and aluminum purchasing into separate buyers," so Miskovich’s familiarity with Ford employees on the steel side would not influence business for Novelis.

The judge ruled that while a restraining order on Miskovich would potentially hurt Novelis because it would deprive the company of an employee, the likelihood was higher that AK Steel would suffer harm due to Miskovich’s participation in strategic decision-making, as well as his access to customer lists and service information that is not known to the public.

A preliminary injunction hearing has been scheduled for March 20.

AK declined to comment, while Novelis did not respond to a request for comment.

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