Blog Banner Image

The Franchise Memorandum

Posts from April 2018 - Issue 228.

A federal court in New York recently dismissed claims brought by a former U.S. distributor of ORI legwear—an Italian hosiery brand—against ORI’s subsequent U.S. distributor. LuxSoma LLC v. Leg Res., Inc., 2018 WL 583119 (S.D.N.Y. Jan. 25, 2018). LuxSoma purportedly entered into a nonexclusive distribution agreement with ORI for distribution of ORI products in the U.S. in June 2011. LuxSoma struggled to sell ORI’s products, so ORI entered into an exclusive U.S. distribution agreement with Leg Resource in July 2012. LuxSoma sued Leg Resource for, among others things ...

Email LinkedIn Twitter Facebook
Posted in Antitrust

The United States District Court for the District of Delaware recently held that a manufacturer’s use of exclusivity agreements with its distributors may support anticompetitive conduct for purposes of the Sherman and Clayton Acts. Roxul USA, Inc. v. Armstrong World Indus., Inc., 2018 WL 810143 (D. Del. Feb. 9, 2018). Armstrong World Industries is a dominant manufacturer in the ceiling tile market, controlling 55 percent of the market share. Roxul USA, one of only three companies that compete against Armstrong, brought suit alleging that Armstrong unlawfully maintained ...

Email LinkedIn Twitter Facebook

The District of Minnesota recently dismissed a plaintiff’s claims under two Minnesota dealer statutes arising out of terms imposed on the sale of the dealership. Bobcat of Duluth, Inc. v. Clark Equip. Co., 2018 WL 559531 (D. Minn. Jan. 25, 2018). Plaintiff Bobcat of Duluth had been a dealer of Bobcat equipment since 2000, and it also sold other lines of equipment including two Kubota products that compete with Bobcat’s equipment. In 2012, Bobcat implemented a new policy in its dealer agreements prohibiting the sale of products that compete with Bobcat’s lines, but this policy ...

Email LinkedIn Twitter Facebook

Following a bench trial, a federal court in Wisconsin last month awarded lost profits for the breach of an exclusive distributorship contract. Sanchelima Int’l, Inc. v. Walker Stainless Equip. Co., 2018 WL 1401195 (W.D. Wis. Mar. 19, 2018). Defendant Walker manufactures dairy silos, and plaintiff Sanchelima was Walker’s exclusive distributor of dairy silos in 13 Latin American countries, including Mexico. Sanchelima alleged that Walker breached its distribution agreement by making five direct sales (and attempting a sixth) to Mexico, and sued Walker for profits lost on ...

Email LinkedIn Twitter Facebook

The United States District Court for the Southern District of Florida granted a manufacturer’s motion to dismiss fraud claims brought by one of its dealers in Broward Motorsports of Palm Beach, LLC v. Polaris Sales, Inc., 2018 WL 1072211 (S.D. Fla. Feb. 27, 2018). The plaintiff, Broward Motorsports, was a dealer of various Polaris products, including Victory motorcycles. In late 2016, it entered its first dealer agreement with Polaris for six product lines, with a term ending June 30, 2017. After entering into the agreement, Broward Motorsports received a letter from Polaris ...

Email LinkedIn Twitter Facebook

The U.S. District Court in Bismarck, North Dakota entered a preliminary injunction that enjoined the State of North Dakota from enforcing amendments to the North Dakota Farm Equipment Dealership Statute, which were enacted in Senate Bill 2289 (SB 2289) on March 16, 2017. Association of Equipment Mfrs. v. Burgum, No. 1:17-cv-151 (D.N.D. Dec. 14, 2017). The plaintiffs included several farm equipment manufacturers and the Association of Equipment Manufacturers. The defendants were the North Dakota Governor, and the dealer association that had drafted the legislation. The ...

Email LinkedIn Twitter Facebook

About this Publication

The Franchise Memorandum is a collection of postings on summaries of recent legal developments of interest to franchisors brought to you by Lathrop GPM LLP. 

To subscribe to monthly emails for The Franchise Memorandum, please click here




















Blog Authors