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Walmart Supplier Strikes Back at AMG in Lawsuit

2 min read

It wasn’t long ago that we told you about a federal lawsuit involving a sales representative who sued a supplier over abruptly severing their relationship after more than 25 years.

Active Marketing Group Inc. of O’Fallon, Missouri, sued EB Brands Holdings Inc. of Elmsford, New York, and alleged EB owes it nearly $700,000 in commission payments based on work already performed under the contract. It is seeking that amount plus damages of more than $2 million.

Well, now EB has filed its response and denied the allegations of wrongdoing. It said the lawsuit was “premature inasmuch as no commissions are due.” It filed a counterclaim alleging that AMG still has some of EB’s property, including business records, sales and marketing materials, confidential and customer reports and Wal-Mart reports.

And EB believes that AMG “has continued to use [EB’s] property for its own use and commercial advantage.”

If you recall, AMG’s main customer is Wal-Mart. And since 1989, AMG arranged sales of EB’s sporting good, travel and gifts and games products to Wal-Mart. AMG would receive a percentage of the sales that EB made to Wal-Mart. Depending on the product, the commission could be 2 percent or 2.25 percent, according to AMG’s lawsuit.

Then, on April 1, EB President Paul Ross wrote AMG a letter saying the contract was being canceled for cause, effective immediately.

Ross said in the letter, which was attached as an exhibit, that the termination was “a result of various breaches in agreement both specific and implied.”

EB said it wants a judge to rule that the termination of the contract was for cause and it doesn’t owe anything else to AMG. It also wants a judge to order AMG to return EB’s property.

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