Clark sues Toyota after dealer terminates relationship

News Story
- 23 Aug 2012 ( #579 ) - Charlotte, NC, United States
3 min read
Clark Material Handling Co has sued major competitor Toyota, claiming it "pressured, coerced and intimidated (Southeast Industrial Equipment Inc) ... into ending its relationship with Clark".

A request to Clark for comment generated this statement from marketing representative Rob Smith: "Regarding Clark's lawsuit against Toyota, it is Clark's policy not to comment on pending litigation. However, Clark stands by the allegations in the complaint which was filed on August 14, 2012 by Clark against Toyota in the United States District Court for the Western District of North Carolina, Charlotte Division."

Separately, Toyota conveyed its opinion, saying Clark's "lawsuit against Toyota Material Handling USA Inc (TMHU) contains a number of misstatements, incorrect assumptions and unsupported allegations".

It notes that SIE has been a Toyota dealer for 26 years. "TMHU, as a business partner, regularly communicates with its dealers, including Southeast Industrial, and has on many occasions provided advice to Southeast Industrial related to selling Toyota products.

"TMHU expressly denies Clark's allegations that it acted improperly or that it unfairly pressured, coerced or threatened Southeast Industrial in any manner. In fact, out of a network of 72 dealers throughout the US and Canada, 27 Toyota dealers represent competing brands as well. Any decisions made by Southeast Industrial regarding Clark were independent business decisions made solely by the dealer. TMHU denies all the allegations of this lawsuit and intends to vigorously pursue its defense that it has not engaged in any improper or unfair business practices."

Through a dealer sales agreement, Clark appointed the Thorne family's SIE on May17 as an authorised dealer for seven SIE locations covering metropolitan Charlotte where it is based, eastern North Carolina, all of South Carolina and the cities of Savannah and Augusta in Georgia. SIE has another location in Richmond, Virginia.

Clark announced the appointment in a press release dated July 10.

Locations of SIE represent numerous brands, including Toyota, Hoist, Manitou, Combilift and Aisle-Master forklifts; Genie and Aichi aerial work platforms; Terex construction equipment; and Wacker Neuson compactors.

The legal complaint says a senior TMHU official contacted SIE's Cory Thorne on or about July 19 "and pressured, coerced and intimidated SIE into ending its relationship with Clark. Means of coercion included threats ... to terminate SIE's Toyota dealership in Virginia and perhaps elsewhere, comments expressing (TMHU President Jeff) Rufener's anger at Clark arising from a prior competitive situation while Rufener was employed by MCFA as its vice president of sales; and a demand that SIE issue a retraction or denial of any dealer relationship with Clark."

Subsequent discussions between SIE and Clark explored SIE's possible establishment of a separate legal entity and/or physical facility for the sale of Clark equipment. TMHU, however, "was not accepting of any alternative arrangements for SIE's Clark dealership but continued to press SIE to drop Clark", the complaint says.

Thorne sent a July 25 letter to Clark "reflecting SIE's decision to give its 30-day notice of termination to Clark".

Thorne had contacted Clark in January 2012 to inquire about the possibility of SIE becoming a Clark dealer in North Carolina and South Carolina.

In the litigation, Clark requests judgment against TMHU for amounts "to be proven at trial" plus attorneys' fees and the granting of "preliminary and permanent injunctive relief (enjoining TMHU) from demanding or coercing its dealers, including (SIE) into terminating distribution relationships with Clark or from refusing to continue or instigate dealer relationships with Clark".

The case, citing six federal and state causes of action, was assigned on August 15 to District Judge Max O Cogburn Jr as presiding judge and Magistrate Judge David S Cayer as referral judge.

Evan M Sauda with the Charlotte law firm of Smith Moore Leatherwood LLP represented Lexington, Kentucky-based Clark in filing the 14-page complaint.

Forklift dealer G&W Equipment Inc of Charlotte distributed Clark products in North Carolina and South Carolina on a non-exclusive basis from September 2006 until "the relationship ended in May 2012," the lawsuit says.
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