Clarion Goes After Transshipping; Files Suit Against Babas Electronics

GARDENA, Calif., May 14 -- Clarion Corporation of America, a leading manufacturer of mobile entertainment systems, filed a lawsuit on Thursday, May 1, 20043, 2004, charging a downtown Los Angeles distributor with the unauthorized sale and advertisement of Clarion's products. The suit was filed with the United States District Court for the Central District of California, and represents Clarion's ongoing effort to protect its authorized dealer network from the practice of transshipping and unfair competition.

"This action demonstrates that Clarion is aggressively responding to this industry wide problem," said Ralf Engelbrecht, Clarion's Vice President of Retail Sales. "This lawsuit is only the first that Clarion will announce."

Named in the suit is Babas Electronics, Inc. The suit alleges federal and state business claims, and charges the company with false advertising, unfair competition and tortious interference with contractual relationships between Clarion and its authorized dealers.

"The action taken today represents Clarion's commitment to protect its dealers and customers, as well as its reputation," said Bruce Ishimatsu, an attorney with Bryan Cave LLP, a St. Louis, Mo.-headquartered international law firm that serves as Clarion's national enforcement legal counsel. "The unauthorized sale of Clarion's products damages the company's dealer network, tarnishes Clarion's name and misleads consumers."

The lawsuit against Babas Electronics is the most recent step Clarion has taken in its ongoing effort to curb the practice and effects of transshipping, as well as protect its dealers and consumers. In January, Clarion announced its partnership with Net Enforcers, Inc., an online intellectual property enforcement agency, to police the Internet for the unauthorized sale of its products and use of the company's trademarked material.

"This action represents a cooperative effort by Clarion's outside legal counsel and our company to protect the best interests of Clarion, its dealers and consumers," said Joe Loomis, president of Net Enforcers, Inc. "The advantage major manufacturers, such as Clarion, have when working with us, is the ability to cover, locate and track the unauthorized distribution of controlled market products."

For more information, or to set up an interview, please contact Heather Pecoroni, Marketing Coordinator, Clarion Corporation of America, 661 W. Redondo Beach Blvd., Gardena, CA 90247. Phone: (310) 965-1719, Email: hpecoroni@clarion.com.

About Clarion Corporation:

Clarion Corporation of America has its headquarters in Gardena, California. Clarion Corporation of America is the largest subsidiary of Tokyo based Clarion Company Ltd., and is ranked among the top 100 Global OEM Suppliers by Automotive News. Clarion, an international leader in car audio and electronics since 1940, is positioned as the number one independent car audio manufacturer. The company conducts research, development, engineering, design, manufacturing, and sales and marketing of entertainment, communications, security, and navigation products for the automotive environment, including IVCS (in-vehicle computing systems). Clarion has more than 14,000 employees worldwide and 24 factories in 10 countries, with marketing and sales affiliates in Europe, North and South America, Asia and Australia. Clarion is located on the Web at www.clarion.com.