Duane Morris LLP - Mack Dealer to Get Court Date

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Mack Dealer to Get Court Date

By Dan Shope
April 2, 2005
The Morning Call (Allentown, PA)

A federal judge has refused to slam the brakes on an antitrust lawsuit against Mack Trucks by one of its Midwestern distributors.

Senior U.S. District Judge Ronald L. Buckwalter on Tuesday cleared the way for a jury trial in Philadelphia this summer involving Toledo Mack Sales & Service in Ohio and the Allentown truck maker.

He also allowed counterclaims by Mack, including breach of contract and copyright infringement, against Toledo Mack. Buckwalter's ruling rejected moves by both sides to dismiss the other's claims. He said he will hold a conference with lawyers for both sides to set a trial date.

The case explores the legal relationship between a major truck manufacturer and one of its distributorships.

"This case goes back to 1989," said attorney Wayne Mack of the law firm Duane Morris LLP in Philadelphia, which represents Toledo Mack.

"Mack has discouraged Mack dealers' competitiveness. It sells trucks directly to its accounts at terms more favorable than its dealers. We now have a $75 million damage claim to go to trial."

Mack Trucks declined to discuss the suit. "Because it involves ongoing litigation, it's our policy not to make any comment," said spokesman Bob Martin.

Wiegand Mack Sales & Service in Detroit and RDK Truck Sales & Service in Tampa, Fla., also are involved in antitrust cases against Mack Trucks.

Mack Trucks, which employs about 2,100 in the Lehigh Valley, is a subsidiary of AB Volvo of Sweden.

Toledo Mack filed the antitrust suit against Mack in 2003, claiming Mack Trucks illegally tried to block it from selling outside its immediate territory.

Toledo Mack also accused Mack Trucks of price discrimination, by selling trucks and parts to the dealership at higher prices than it charged other dealers. Before Mack Trucks began that policy in 1989, Toledo Mack sold 166 Mack trucks annually, according to court papers. A year later, the number was 86. Sales declined every year between 1990 and 1998.

Toledo Mack officials said Mack tried to withdraw its franchise in retaliation for its lawsuit. A judge blocked that move in August.

Mack Trucks can also move forward with its counterclaims against Toledo Mack that include misappropriation of confidential business information; copyright infringement; breach of contract and civil conspiracy.

According to court papers, Mack has produced evidence that Toledo Mack fraudulently obtained and supplied confidential business information such as price lists to Mack competitors PAI Industries, Northwest Truck and Illinois Diesel.