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In July, a federal court judge in North Carolina ordered that Toyota Material Handling USA must pay Clark Material Handling Company more than $11 million in connection with a lawsuit involving competition in the forklift market in the Southeast.
Last week, the case was finally settled for an undisclosed amount, according to a representative of Clark’s legal team from the law firm Smith Moore Leatherwood LLP.
Original $3 Million Award Tripled
The case dates back to 2012 when a federal jury in the case awarded Clark $3 million in connection with a complaint by Clark that Toyota “pressured, coerced and intimidated” a Charlotte heavy equipment dealer to stop selling Clark equipment.
In July of 2016, the federal judge in the case tripled that award amount to $9 million. Once court costs, legal fees, and interest rates were added in, the total award exceeded $11 million.
Battle for the Carolina Forklift Market
Clark claimed that Toyota used unfair competition, tortious interference with contract, and tortious interference with a prospective economic advantage when it allegedly coerced Southeast Industrial Equipment Inc (SIE) to stop offering Clark products to its customers. The suit also accused Toyota of violating anti-unfair trade practice acts in both North and South Carolina.
During the original trial, the eight-person jury found that Toyota:
- Wrongfully interfered with a contract right between Clark and SIE
- Wrongfully interfered with a prospective economic advantage attained by Clark in its contract with SIE
- Coerced SIE into terminating its dealer relationship with Clark, causing the dealer to stop purchasing forklifts made by Clark
- Unlawfully coerced SIE to end its relationship with Clark by threatening to terminate SIE’s Toyota dealership in Richmond, Virginia
The jury voted “no” on a charge that Toyota unlawfully coerced SIE to end its relationship with Clark by unfairly demanding that SIE issue a retraction or denial of an article on ForkliftAction.com, in which it reported that SIE had become a Clark dealer.
Long Legal Battle Finally Resolved
According to court filings filed jointly before the trial, SIE has offered Toyota products to its customers in the Carolinas and Virgina since 1987. The dealership’s current non-exclusive agreement was initiated April 18, 2012, and was due to expire April 17 of last year. The document authorized SIE to sell other forklift brands and the dealership currently offers Aisle-Master, Hoist and Combilift vehicles.
In January 2012, SIE started to consider adding Clark to its product offering and the dealership notified Toyota of its intention in April 2012 and began selling Clark forklifts in July of that year.
But the dealership abruptly announced that it was terminating its deal with Clark later that same month, citing a “perceived conflict with its current vendor” which was identified in court documents as Toyota.
Clark’s attorneys, led by Natalma McKew and Evan Margosian Sauda — charged that SIE was unfairly influenced by Toyota to dump its deal with Clark. Toyota was represented in the case by attorney Paul Joseph Osowski.
TMHU is headquartered in Columbus, Indiana but is owned by Toyota Industries Corp, of Kariya, Japan. Clark is based in Lexington, Kentucky and is owned by Young An Hat Co. Ltd, of Bucheon, South Korea.
Both companies compete in the forklift trucks and parts market in the Southeastern US, but Toyota enjoys a substantially larger market share. Clark has only 2 to 3% of forklift market in that region. Toyota forklifts are sold by 67 dealers, and Clark’s vehicles are sold by 79 dealers.