Exponent, which bills itself as “an engineering and scientific consulting firm that provides solutions to complex problems”, may have to forego $740,000 owed it by Chrysler, the troubled (is there any other kind these days?) auto manufacturer that filed for bankruptcy protection last month.
The fact was noted in the company’s quarterly financial form known as a 10-Q, which it filed Wednesday. Exponent said that the ultimate loss, if any, from the bankruptcy filing could not be determined at this time. Nevertheless, the amount Chrysler owed represented just 1.1 percent of the company’s total accounts receivable and that, no matter the resolution, would n’t have a “material adverse effect on its financial condition, results or operations or liquitity.”
Formerly known as Failure Analysis, which traded under the ticker symbol FAIL, Exponent listed in its last annual report 21 areas of expertise it offers.
Last year, Exponents biomechanics unit assisted an implant manufacturer in evaluating various state-of-the-art “bone-conserving” hip implant designs designed to provide an alternative treatment option to conventional total hip replacements in younger, more active patients.
Its electrical and semiconductors unit worked on what it described as “multiple high-profile complex patent and trade secret litigation cases in the district court system and the United States International Trade Commission.” The company declined to name any of its clients, but there is no shortage of local companies involved in such patent litigation, including Tessera Technologies, Rambus, Opti and Tivo.
Presumably, Chrysler’s unpaid billable hours related to Exponent’s vehicle analysis unit, which has a 147-acre test and engineering center in Phoenix and provides design analysis, vehicle crash testing, component testing and accident reconstruction services to clients developing new automotive products, facing unexpected performance issues, or seeking information on how an accident occurred.
A large portion of Exponent’s business is related to litigation, though the company would not say how much. A 2007 BusinessWeek article pegged it at 65 percent. The company does list “tort reform” among the potential risks it faces, given that several of its practices have “a significant concentration” in litigation support services. “To the extent tort reform reduces the exposure of manufacturers, owners, service providers and others to liability,” the company stated, “the demand for our litigation support consulting services may be significantly reduced.”