While Coachmen Industries Inc. is preparing to begin marketing towable RVs under the Coleman brand name, executives at Fleetwood Enterprises Inc. are hopeful that the court case involving its civil damage claims against the two firms will go to trial later this year.
A jury trial for Fleetwood’s claims could take place in state court in Kansas “in the October time frame,” Forrest Theobald, Fleetwood’s senior vice president and general counsel, said during an exclusive interview with RVBUSINESS.com.
Fleetwood subsidiary Pennsylvania-based Fleetwood Folding Trailers is seeking damages against Coleman for “the improper termination of the licensing agreement” between it and Coleman that dated back to 1989.
Meanwhile, parent company Fleetwood Enterprises is seeking enforcement of the “negative covenant” in which Coleman agreed, in 1989, that it would not allow any company except Fleetwood to ever use the Coleman trademark on any RV product.
Theobald did not want to reveal Fleetwood’s calculations, but he said the amount of damages Fleetwood plans to seek from Coleman and Coachmen is “a big number.”
When asked if Fleetwood might eventually seek a court injunction to prohibit Coachmen from building or marketing its proposed Coleman by Coachmen series of RV products, Theobald replied, “We are considering every action that might be viable to us.”
Fleetwood’s folding-camper operation in Somerset, Pa., remains the market-share leader in folding campers by a wide margin, despite the fact it stopped using the Coleman named last year as a result of the legal dispute with the camping products manufacturer. Theobald said Fleetwood is continuing to pursue legal remedies because, “We do know that there is a lot of discomfort in the dealer body. Some dealers dropped us over it (the Coleman dispute) and there continues to be a lot of uncertainty among the dealer body, and other people (competing manufacturers) now are soliciting our dealers. I think there’s a huge, huge opportunity to present damages (claims) in this case.”
When asked about the possibility of an out-of-court settlement, Theobald replied, “I won’t say there’s never a possibility, but the huge issue is the negative covenant issue, and Coleman hasn’t shown any signs of recognizing that they are obligated under that agreement. But we’re maintaining that they are. It’s pretty well polarized on that issue.”
Theobald added that he believes it “will be difficult” to reach an out-of-court settlement on the issue of the improper termination of the licensing agreement.
Asked whether Fleetwood executives believe Fleetwood ever would be able to use the Coleman name again, Theobald replied, “I don’t know the answer to that, but if I were guessing, based upon Coleman’s present stance, I would say, ‘No.’
He said the court in Kansas, where Coleman is based, “has concluded that Coleman had the right to terminate the licensing agreement between The Coleman Co. and Fleetwood Folding Trailers,” Theobald continued. “While they may have the right to do that, they still may need to be liable for damages as a result of that determination. That’s an issue that hasn’t been resolved.”