News story

FLS SUES CROWN IN DEALERSHIP WAR

Thursday, 18 March 2004 ( #149 ) - TAMPA, FL, United States
Florida Lift Systems Inc (FLS) has added another layer of litigation in its escalating dealership dispute with Crown Equipment Corporation.
Crown wants to terminate FLS as a Crown dealer (Forkliftaction.com News #144) and allegedly is attempting to supplant FLS in the central Florida market.
The clash raises questions about the varying roles of original equipment manufacturers and regional dealers when marketing multiple brands.
In the new legal round, FLS has filed a civil suit against Crown and company store manager Gary Lunz alleging breach of contract, publication of false statements and business interference.
In the suit, filed on March 8, FLS alleged Crown was opening an authorised dealership or Crown-owned branch or dealership in Tampa "on or about March 12, 2004". No indication of such an opening was filed with the court at deadline.
"In opening its own company store, Crown is wrongfully attempting to solicit FLS's employees, managers and customers by utilising its monopolistic market power in Florida to intimidate FLS's employees, managers and customers into working for and doing business with Crown and by disparaging FLS's business operations," the suit says.
FLS has asked for a court judgement against Crown and recovery of damages.
FLS, a participant in the Florida forklift market since 1950, has annual sales in the mid-USD40 million range. The FLS relationship with Crown began in 1996 and is scheduled to run through to February 2005.
Separately, Crown filed US District Court lawsuits against FLS and Toyota Material Handling USA Inc (TMHU) on January 13 and February 4, respectively. The FLS case is pending in Dayton, Ohio, and the TMHU case in Toledo, Ohio.
Crown's litigation alleges FLS breached its dealership agreement with Crown and that TMHU caused FLS to breach the agreement.
"Crown's attempted termination of the dealer agreement is a mere pretext to be able to open a company store in Tampa, Florida, in direct violation of the terms of the dealer agreement," the FLS suit in Tampa said.
As previously reported, FLS began representing TMHU in Orlando in September 2002, before Crown's latest extension with FLS, and, at the time, Crown did not object to FLS adding TMHU products for Orlando. FLS expanded and became a TMHU dealer in Tampa on January 5, 2004.
John Maxa, Crown vice-president and general counsel, explained the corporation's position on the pending FLS termination in a memorandum to dealer principals last month: "(FLS) and Toyota were aware of the provisions of the Crown dealer agreement and, in complete disregard of the rights and obligations established by the ... agreement, they entered into a new dealer agreement (and) presented it to Crown as a done deal. Crown had no choice but to commence litigation to enforce termination of the dealer agreement with Florida Lift because of its clear breach."
On March 3, Crown agreed to extend the FLS termination date from March 16 to April 15 "to allow the parties to discuss a resolution" to the federal suit in Dayton, according to a letter by Charles Faruki, a Dayton attorney representing Crown, filed with the Florida suit.
Thomas Long and Scott Stigall, attorneys with a Tampa law firm, filed the Florida suit on behalf of FLS.
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