A trial court verdict against Kohler Co. by former Kohler plumbing distributor, Coburn Supply, was recently reversed after an appeal by Kohler to the 5th U.S. Circuit Court of Appeals in New Orleans. Coburn, a Beaumont, Texas-based wholesaler, originally charged Kohler with terminating a relationship, which had built gradually over the course of 60 years, without reasonable notice. Kohler, a Wisconsin-based manufacturer of plumbing and kitchen supplies, will not have to pay any of the final judgment, which was in excess of $2.9 million, for compensation for damages.

“As with all its distributor relationships, Kohler Co. places a high value on open and honest communication and the judgment in this lawsuit reflects that,” said Ron Pace, president, Plumbing Americas.

The suit was originally filed in January 2000, and a jury reached a verdict favoring Coburn after it first went to trial in April 2002. Coburn's charge contended that Kohler started discussions with another distributor two years prior to ending the relationship, and, in the meantime, encouraged Coburn to promote Kohler products. Kohler contended that its market share in Coburn's territory shrunk from 12.9% in 1992 to 7.6% in 1997, while Coburn's overall sales of non-Kohler products increased. Kohler also argued that it did not have any written contract with Coburn, as is common in the industry.

The Court of Appeals rendered a unanimous decision after hearing oral arguments, and upheld that Coburn had adequate time to foster a relationship with a new supplier.

“Our feeling right now is that locally we were vindicated by a jury of our peers,” said Don Maloney, president of Coburn Supply. “We're disappointed, but not devastated that the 5th Circuit reversed it.”

Coburn still sells products by American Standard, the company it began working with after the close of its relationship with Kohler.

- Ashley Anderson