Forklift Dealer Held to be a Missouri Franchise

A federal district court ruled that a forklift dealer’s relationship with its manufacturer constituted a “franchise” under the meaning of the Missouri Merchandising Practices Act (the “MMPA”), and that the manufacturer had violated the MMPA by failing to give the dealer only 22 days’ notice of termination, instead of the statutorily mandated 90 days’ notice.

In arriving at its decision, the court noted that a written agreement between the dealer and manufacturer granted the dealer a “nonexclusive privilege to identify itself as an Authorized Dealer, and to display, in the conduct of its dealership operations, the trademarks and service marks [that the manufacturer] uses in connection with [its] products.” The manufacturer’s marketing plan also imposed certain minimum sales requirements on the dealer. According to the court, these arrangements constituted the grant of a license by the manufacturer to the dealer to use its trade and service marks, and the existence of a community of interest in the marketing of goods and services, thus satisfying the definition of a “franchise” under the MMPA.

Lift Truck Lease and Services, Inc. v. Nissan Forklift Corporation N.A., E.D. Mo., No. 4:12-CV-153 CAS, September 7, 2012.

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