Printer Friendly

ENVIROTEST PETITIONS STATE OF MAINE TO VOID CONTRACT WITH SNAP-ON/SCI; CITES SCI'S FALSIFICATIONS OF BID DOCUMENTS & CONFLICT OF INTEREST

-- Appeal Based on SCI Violation of Maine Civil & Criminal Statutes --
 TUCSON, Ariz., May 12 /PRNewswire/ -- Envirotest Systems Corp. (NASDAQ: ENVI) today filed an appeal with the Maine Department of Administration (DOA) of the award by the Department of Environmental Protection's (DEP) for the State's Motor Vehicle Emissions Inspection Program (MVEIP) to Systems Control, Inc., a subsidiary of Snap-on Tools, Inc. (NYSE: SNA). The appeal calls for a formal hearing of Envirotest's charges against SCI and a stay of the contract award.
 Envirotest's action filed with the DOA follows a request made by Maine State Senator Mark Lawrence and Rep. Paul Jacques to the Attorney General that he investigate the awarding of the contract to SCI. Also, in a separate lawsuit filed in Federal Court in Manhattan on May 4, 1993, Envirotest and its subsidiary, Envirotest Technologies, Inc. (ETI), charged SCI/Snap-on and related parties with an illegal scheme to deceive state authorities across the country. That lawsuit seeks $100 million in damages.
 Envirotest said that "the grounds for today's appeal filed with the DOA are that SCI deliberately made false and misleading statements in its bid documents regarding its corporate history, experience, operations, capabilities, personnel, property and rights. These material falsifications in SCI's bid proposal deceived the MVEIP contract review committee, thus invalidating the evaluation score upon which the award of the contract was based.
 "SCI's bid proposal included statements designed to deceive the Maine DEP into erroneously believing:
 -- that SCI, rather than ETI, was the corporation that obtained,
 implemented and administered the MVEIPs in Maryland, Florida,
 Illinois and Minnesota;
 -- that SCI is generally more experienced than its competitors;
 -- that SCI has experience in operating MVEIPs in cold climates
 similar to that of Maine;
 -- that SCI has learned specific skills in prior operations and that
 it has sufficient number of experienced personnel to manage the
 Maine program;
 -- that Envirotest, rather than SCI, is a newcomer to the industry.
 "SCI bid documents are replete with false statements that completely distort its qualifications to operate Maine's MVEIP. Envirotest's appeal of the award to SCI cites many statements made in SCI bid documents. For example, SCI in its bid falsely claimed that "SCI has gained a great deal of experience in cold temperature emissions testing from the successful operation of inspection programs in Minnesota, Alaska, Washington State, Maryland, and Illinois". The fact is that SCI has no experience in any of those states, except for Washington State.
 "SCI also violated the Request for Proposal's (RFP) conflict of interest requirements which state that "neither the contractor nor any private concern operating any portion of the inspection program shall have any financial interest in any automotive repair enterprise located within the geographic area subject to the program." The conflict of interest provision is designed to assure Maine consumers that the company performing the vehicle emission tests has no financial incentive with respect to the test's outcome.
 "SCI is a subsidiary of Snap-on Tools. Snap-on sells its tools to automobile repair facilities located in the seven counties included in Maine's inspection and maintenance program. Many of these tools are financed by Snap-on through a purchase money security agreement which requires the automobile mechanics to make weekly payments for the tools and financing charges. As a holder of these financing instruments, Snap-on Tools clearly has a direct financial interest in automotive repair enterprises.
 "SCI, Snap-on's subsidiary, thus has a financial incentive to fail cars, since failure will require more cars to seek repairs. Some of these repairs would be done by Snap-on customers. SCI would have the additional incentive to refer cars that failed to garages operated by Snap-on customers and to pass cars that were repaired in shops purchasing significant quantities of Snap-on Tools.
 "This clear conflict of interest, as well as SCI's failure to disclose the conflict, require that SCI be completely disqualified under the terms of the RFP.
 "The evidence contained in SCI's own bid documents and other corporate materials is overwhelming. SCI clearly obtained the MVEIP contract award by deceiving the Maine DEP, in the process violating several of the State's laws. The appropriate remedy is to void the contract award to SCI/Snap-on and to award the contract to Envirotest as the bidder receiving the highest evaluation score," Envirotest said.
 -0- 5/12/93
 /CONTACT: Robert D. Siegfried, or Richard Wolff, both of Kekst and Company, 212-593-2655, for Envirotest Systems Corp./
 (ENVI SNA)


CO: Envirotest Systems Corp., Snap-on Tools, Inc. ST: Arizona, Maine IN: SU:

LD -- NY102 -- 7763 05/12/93 16:58 EDT
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:May 12, 1993
Words:752
Previous Article:DUFF & PHELPS: LOUISVILLE GAS AND ELECTRIC COMPANY $25 MILLION CUMULATIVE PREFERRED STOCK RATED 'A+'
Next Article:AMERICAN STOCK EXCHANGE DAILY REPORT
Topics:


Related Articles
ENVIROTEST SUES TO VOID MINNESOTA CONTRACT WITH GENERAL MOTORS SUBSIDIARY
ENVIROTEST CHARGES SNAP-ON SUBSIDIARY, SCI, WITH FRAUD; ACTION SAYS ILLEGAL SCHEME DECEIVED STATE AUTHORITIES; SUIT SEEKS $100M IN DAMAGES
ENVIROTEST SYSTEMS STATEMENT ON SNAP-ON TOOLS LAWSUIT
MAINE HALTS AWARD OF STATE MOTOR VEHICLE EMISSIONS INSPECTION PROGRAM (MVEIP) CONTRACT TO SNAP-ON/SCI
STATE OF MAINE ORDERS APPEAL HEARING ON CHARGES THAT SNAP-ON TOOLS ILLEGALLY OBTAINED STATE MVEIP CONTRACT
ENVIROTEST ANNOUNCES SETTLEMENT OF LITIGATION
ENVIROTEST SYSTEMS REPORTS THIRD QUARTER EARNINGS RESULTS; REVENUES AND OPERATING INCOME INCREASE FOR QUARTER AND NINE MONTH PERIOD
OHIO NAMES ENVIROTEST LOW BIDDER; COMPANY HAS BEST PRICE FOR THREE NEW PROGRAMS
DIGITAL EQUIPMENT AND SCI SYSTEMS SIGN AGREEMENT FOR SALE OF DIGITAL'S INT'L CONTRACT MANUFACTURING BUSINESS AND MAINE MANUFACTURING FACILITY
ENVIROTEST PURCHASES SYSTEMS CONTROL, INC.'S WASHINGTON STATE SUBSIDIARY AND ACQUIRES OPTION TO PURCHASE ITS INDIANA SUBSIDIARY

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters