SANDPOINT - A court order has been entered to regulate the flow of discovery materials in the contentious legal battle between Percussionaire and its former president and CEO.

First District Judge Barbara Buchanan entered the protective order last Wednesday, court records show.

The order is meant to control costs of exchanging the materials, avoid oppression of either party and guard against the disclosure of confidential information.

Percussionaire sued former CEO Dr. Adel Bougatef earlier this year, after the company learned of his alleged plans to hobble Percussionaire and start a rival company that manufactures intrapulmonary percussive ventilation devices.

Bougatef's counsel disputes the allegations and contends he was drummed out of the Sagle company after bringing to light accounting errors and irregularities.

The disclosure of confidential materials - financial records, marketing strategies and product development materials - has been an ongoing struggle for both parties. The plaintiffs have sought to keep sensitive materials out of the public realm to protect Percussionaire, while the defense has sought their disclosure so it can adequately defend Bougatef and sustain its counterclaims against the company.

Under the protective order, some information can be filed under seal. The confidential designations can be challenged and judicial intervention can be used to break deadlocks, according to court documents.

The fractious dispute pits Percussionaire founder Dr. Forrest Bird against Bougatef, who is described as a longtime protege of Bird's.

Bougatef is accused of conspiring with a mutinous group of Percussionaire employees known as the Ring of Fire to hijack the company's designs and business methods for the rival startup, court documents allege.

Bougatef is further accused of using nearly $700,000 in Percussionaire funding to develop prototypes and design a new ventilator called the Bougatron. The Ring of Fire, meanwhile, is accused of systematically copying and deleting vital documents, some of which Percussionaire needed for regulatory compliance.

Doctor Loel Fenwick, the director of Percussionaire's board, said in an affidavit that Bougatef's actions have cost the company $3 million, two years of progress in a changing marketplace and jeopardized its viability.

"While extraordinary measures are stabilizing the company, Percussionaire's future is threatened by Dr. Bougatef's ability to use Percussionaire's and Dr. Bird's trade secrets to start or empower another company," Fenwick said in the affidavit.