Independent Equipment Dealer or Company Franchise Store?

During the first half of this year, we have devoted a good number of pages in this publication to actions in the North Dakota legislature, which updated its state law regarding contracts between independent equipment dealers and their suppliers. 

The legislature passed SB 2289 with near unanimous support. The governor signed the law, and it took effect August 1. (Find background at FarmEquip.org/ndhistory.)

A complaint has been filed (AEM et al. vs. North Dakota) asking the federal courts to block the law from taking effect on constitutional grounds. On Wednesday, the presiding judge granted the state’s motion to extend the time to reply until September 30, 2017.

We need to be very clear that the Farm Equipment Manufacturers Association is NOT a party to the action taken by AEM and the major tractor manufacturers it represents.

Our Association took a neutral position on the proposed law as it worked its way through the legislative process. We are disappointed to see AEM’s legal action in North Dakota.

Our Association’s officers will meet this week to discuss the lawsuit, and we will of course be anxious to review the state’s response to it. Until then, our response will be measured.

What we want you to know today is that we are are very concerned with arguments made to defend what we call “dealer purity,” which is what we believe this suit seeks under the protection of federal trademark law.

Dave Kanicki and Kim Schmidt with Lessiter Media have done an excellent job of reporting on the initial claims made in this case, and I encourage our members to read Dave’s opinion column, “Independent … but Not Too Independent.” Find it at FarmEquip.org/Kanickicolumn.

In the column, Dave says you have to read the suit to get the real flavor of what “manufacturers” think of their dealers. I agree.

I urge members to make it clear to dealers that not one “shortline manufacturer” or our Association had any part in bringing this suit. The lawsuit supports the absolute opposite view of ours regarding dealer purity and competition in the marketplace.

Our Association remains exclusively dedicated to supporting the interest of shortline equipment manufacturers.

That support includes using all means at our disposal to protect your right to market your equipment through independent equipment dealers who may or may not also market equipment from multi-national tractor corporations. We are confident that by working with independent dealers, our members will continue to bring choice, value and innovation to agriculture.

A members-only webpage will be launched later this week for those who would like to access the public court documents. As always, I encourage members with questions or comments to contact me or our Association’s elected leadership directly.

It is events like this that reinforce the value of a trade association dedicated exclusively to shortline manufacturers. Thank you for your membership and continued support.