Menu
Blog Banner Image

The Franchise Memorandum

No Dismissal of Terminated Dealer's Tortious Interference Claim Against New Dealer
Posted in Terminations

An Illinois federal court denied a motion to dismiss a tortious interference claim, finding that the facts as alleged could sustain such a claim. In Echo, Inc v. Timberland Machines and Irrigation, Inc., 2009 WL 2746725 (N.D. Ill. Aug. 26, 2009), a Timberland dealership agreement was terminated by an outdoor power equipment manufacturer, Echo. In addition to claims against Echo for wrongful termination, Timberland asserted a claim of tortious interference with contract against a neighboring dealer (LEPCO) that took over Timberland’s former sales territory on the effective date of the termination. 

Timberland alleged that LEPCO “induced” Echo to terminate Timberland’s distribution agreement as a means of acquiring its territory, in violation of the Connecticut Franchise Act. The court found Timberland’s allegation that LEPCO knowingly persuaded Echo to violate the Connecticut law could plausibly amount to tortious interference. The motion to dismiss was therefore denied. On the same facts the court refused to dismiss claims against LEPCO for unjust enrichment and violation of the Connecticut Unfair Trade Practices Act.

Email LinkedIn Twitter Facebook

The information contained in this post is provided to alert you to legal developments and should not be considered legal advice. It is not intended to and does not create an attorney-client relationship. Specific questions about how this information affects your particular situation should be addressed to one of the individuals listed. No representations or warranties are made with respect to this information, including, without limitation, as to its completeness, timeliness, or accuracy, and Lathrop GPM shall not be liable for any decision made in connection with the information. The choice of a lawyer is an important decision and should not be based solely on advertisements.

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

Topics

Archives

2024

2023

2022

2021

2020

2019

2018

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

Blog Authors