Lawsuits Mark Dispute Over Hi-MACS Pacts

by WOHe

Lawsuits Mark Dispute Over Hi-MACS Pacts

A pair of lawsuits have been filed in what has now developed
into a full-blown legal dispute between a leading solid surface
material supplier and the company that had been serving as its
exclusive U.S. sales, marketing and distribution arm.

At issue is whether or not the supplier, LG Chemical America and
its parent company, the Korean-based LG Chemical Ltd., breached its
contract or was justified in its recent decision to terminate its
relationship with the Tampa, FL-based Decorative Laminates, Inc.
(DLI), formerly known as LG Decorative Surfaces.

According to DLI president Jack Ballard, his company last month
filed a multi-million-dollar lawsuit in a Federal Court in Florida
against LG Chemical America, Inc. and LG Chemical Ltd., alleging
breaches of the distribution contracts between DLI and LG Chemical,
whom, he charged, “failed to meet its promises.”

The DLI lawsuit came on the heels of LG’s decision to cut off
supplies to DLI of its solid surface product, marketed under the
name of Hi-MACS.

In the meantime, K.S. Park, president of the Englewood, NJ-based
LG Chemical America, reported that the company has filed a
countersuit disputing DLI’s claims. Park would not publicly
elaborate on the reasons his company decided to sever its ties with
DLI, but indicated they would be spelled out in the legal action.
He did note, however, that LG Chemical America has established
interim U.S. distribution through Phoenix-based Premier Solid
Source and will name a new permanent U.S. distributor in the near
future.

DLI, operating for the past two and a half years as LG
Decorative Surfaces, had been acting as the sales and marketing
arm, and the exclusive U.S. distributor, of LG Chemical’s two
products: HiMACS, an acrylic solid surface material used for
countertops and related applications, and LG Prime, a high-pressure
laminate flooring material.

In that time, Hi-MACS sales in North America rose from about
$1.4 million in 1998 to $13 million last year, according to
Ballard. Hi-MACS sales for 2000 are projected at $25 million,
Ballard added.

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