Car alarm distributor Mongoose New Zealand is suing a rival business that alleged its top-of-the-line car alarm did not meet a certification standard.
Mongoose NZ's general manager, David Harley, said in the Auckland District Court yesterday that sales of the MX750S alarm fell significantly when Ultimate Security Systems claimed in September1998 that it did not comply with the certification standard.
Mr Harley said the allegation affected sales and injured the company's reputation. He calculated that Mongoose lost more than $48,000. Sales of the alarm did not recover until March 1999. Mongoose was seeking damages, he said.
Under cross-examination from Iain Hutcheson, counsel for Ultimate Security Systems, Mr Harley said there had been no question of the integrity of the product apart from the certification issue.
The fact that Mongoose had sold 10,000 of the alarms to date was evidence that it was proven and well known.
He confirmed there was market resistance to the product but that was because of the rumours about compliance, not about the alarm's performance or security.
Judge Nicola Mathers asked Mr Harley if a downturn in the economy could have affected sales.
He replied that a downturn would affect the whole of the company and not just one product.
William Keane said he was distribution manager for the Automobile Association in September 1998 when he received a letter from Ultimate Security Systems alleging the MX750S did not comply with standards.
