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Press Releases

Electronics Firm Must Pay $1.6 Million
To Former District Sales Representative

 
Los Angeles Daily Journal
October 8, 1985

Hitachi Sales Corporation of America will have to pay former manufacturer's representative George Emerson $1.5 million in punitive damages and $166,000 in compensatory damages after a decision handed down by U.S. District Court Judge Jesse Curtis in Los Angeles.

Emerson had been a partner for 11 years in Emerson & Hines Inc., a company representing Hitachi on an exclusive basis in Arizona, New Mexico, Nevada, and parts of Southern California. Emerson & Hines sold Hitachi consumer electronic products to distributors and retailers.

Emerson decided in late 1981 to leave Emerson & Hines. Income from sales of his 51 percent share of Emerson & Hines stock to partner Floyd Hines and outside investor Philip Macedon was intended to provide the 63-year-old Emerson with retirement income.

Emerson, meanwhile, went to work for Fleehart & Sullivan, sales representatives holding an exclusive Hitachi franchise for Washington, Oregon, Idaho, and Hawaii.

Contract Removed
Shortly after Emerson left the first company, Hitachi removed Emerson & Hine's exclusive territorial sales contract, a move which essentially made worthless the stock Emerson sold.

Los Angeles lawyer Craig Jorgensen, who represented Hitachi in the court action, said Monday that Hitachi removed Emerson & Hines' franchise after learning Emerson moved from the sales territory to Idaho during the fourth quarter of the year, the critical sales period for a consumer products company.

Emerson was fired by Fleehart & Sullivan shortly after Emerson & Hines lost the Hitachi contract.

In his suit for interference with his retirement plan, Emerson claimed Hitachi pressured Fleehart & Sullivan to fire him, threatening to pull Fleehart's franchise if he was not terminated.

Emerson, who was represented by Century City lawyer Philip Ganz, said Hitachi "interfered with" the Emerson & Hines stock sales retirement plan. He claimed Hitachi acted with malice to "shake him up" by having him removed from Fleehart & Sullivan. He was left with no retirement income and was of an age that made it difficult for him to get another job, Ganz said Monday.

Emerson's suit was filed against Hitachi in Boise, Idaho in 1981 but the trial was moved in 1982 to California, where the sales corporation of the Japanese electronics giant is based.

According to Ganz, Emerson is now in Idaho where he has launched a second career, selling real estate.

The lawyer for Hitachi said the firm would appeal.

Copyright 1985 Daily Journal Corp. Reprinted with Permission.

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