Guitar Center Lawsuit

[FusionFarmer]

The CEO of Rickenbacker posted this on their in house forum. anyone familiar with what this is all about, besides GC being a bunch of weenies.

Guitar Center's latest Annual Report (10K) contains the following statement:

LEGAL PROCEEDINGS

On November 29, 2005, a case was filed against us and other defendants, including our Chief Executive Officer, in the United States District Court for the Southern District of Florida. The complaint asserts, among other things, violations of the Federal Racketeering Influenced and Corrupt Organization Act (RICO) and a corresponding Florida statute, Sections 1 and 2 of the Sherman Antitrust Act, Section 2 of the Clayton Act (as amended by the Robinson-Patman Act), the Antidumping Act of 1916, the Florida Antitrust Act of 1980, and the Florida Deceptive and Unfair Trade Practices Act, as well as tortious interference with business relationship under Florida law and civil conspiracy under Florida law by some or all of the identified defendants in connection with the claimed inability of Ace Pro Sound and Recording, L.L.C. to obtain vendor lines for its store. The complaint purports to be made as a class action on behalf of all current and former retail sellers of musical instruments and/or sound equipment and/or recording equipment with stores located in geographical regions in the United States wherein some or all of the defendants have carried on business, and seeks compensatory damages, treble damages, punitive damages, injunctive relief and attorneys fees. Service relating to the complaint was made on us on January 12, 2006 and a responsive pleading is due in March 2006.

While we believe this lawsuit is without merit and intend to defend it vigorously, it may, regardless of the outcome, result in substantial expenses and damages to us and may significantly divert the attention of our management. There can be no assurance that we will be able to achieve a favorable settlement of this lawsuit or obtain a favorable resolution of this lawsuit if it is not settled. An unfavorable resolution of this lawsuit could have a material adverse effect on our business, financial condition and results of operations. Regardless of the outcome, the costs and expenses incurred by us to defend this lawsuit could adversely impact our financial condition.

==========================

The Music Trades, April 2006 edition also carries an article titled:

Fred Rubin Files $1.0 Billion Suit Against Guitar Center & Seven Suppliers

"Class action alleges that GC prevented Korg USA, JBL, Mackie, St. Louis Music, TASCAM, Telex, and Yamaha from selling to his Ace Pro Sound & Recording"

As it says, those companies above are also defendants in this suit.

[Drake S.]

Ahh you gotta love this GC 's mind set has always been get rid of the mom & pop stores around & let people decide wich big name they're gonna shop at Sam ash or GC since Mars went down thats who we have down here in Miami, a few smaller stores have survived, like maybe 3 or 4 tops. They have all been around for more than 20 years though.

[fuel0707]

Here in Columbus, you can walk from the GC to the Sam Ash in just a few minutes. I remember GC had a similar location overlap with a MARS site in Dallas years ago.

Of course, Wal-Mart seems to have a strategy similar to GC: move in, drive out the existing competition and create a mini-monopoly.

[GWARGHOUL]

Shit. MINI- monopoly?

Nothin Mini about Wal-Mart.

[markD]

GC and the mega stores never seem to have anything but red strats, red bc rich warlocks and red epiphone SG's.

luckily in the tampa area we still have quite a few smaller stores that do rather well. i am luck enough to be able to stay away from the mega stores. i have not set foot in GC for over a year!!! sam ass, about 8 months ago....but only because they sell di'marzio straps!!!!!

[rjohnstone]

I only go to GC when strings are on sale... otherwise, it's A-Z Music up the street.
They got a tech there that knows his shit. No, their prices may not be the best, but they know wtf they're talking about and they don't try and BS me.
And they actualy sell parts. Plates, jacks, pots, pups, trems.. you name it.
Again, not the cheapest, but it's there when you can't wait for mail order stuff.
I'm trying to convince them to carry Jacksons... no other shop within 10 miles has them, so it wouldn't be a bad idea.

[MBreinin]

I have been to both the GC in New Orleans and in Baton Rouge.

I looked at both for an EVH Art Series, because I wanted to play one. NO Charvels at all, at either.

I asked the sales guy in Baton Rouge about them...and he asked me if they were still making Charvels, he hadn't seen one in years. :ROTF:

He did point me to some nice bottom of the line import Jacksons though....and then informed me that Jacksons were the good guitars anyway.

[LouSiffer]

Here in Columbus, you can walk from the GC to the Sam Ash in just a few minutes. I remember GC had a similar location overlap with a MARS site in Dallas years ago.

Of course, Wal-Mart seems to have a strategy similar to GC: move in, drive out the existing competition and create a mini-monopoly.

Yes, but our Sam ash is the equivalent of walking into a run down Odd Lots.-Lou

[BTB007]

For anyone with Pacer access, the docket number is 1:05-cv-23098, Florida, Southern District.
I checked and the judge hasn't released any significant Opinions or Orders yet.

[mattsmusiccenter]

I read about this last month... kinda surprised Rickenbacker put it on their forum. I hope the guy in FL wins, GC is the devil.

[Zerberus]

If you want the guitar world to keep going in EXACTLY the same direction almost all manufacturing is going in (Cheap, foreign labor yielding a lesser quality products that the Sheeple still purchase because they think they´re getting the same thing)... Well, then just keep on buying from MF / GC despite their crappy service, selection, and business ethics

But don´t come whining to me about it in 10 years, because I´ll bitchslap you all the way back to this thread

[fuel0707]

Yes, but our Sam ash is the equivalent of walking into a run down Odd Lots.-Lou

I almost walked into the Sam Ash on Morse Rd a few weeks ago because I really needed some 12AX7's. But GC had them so I saved the trouble of going down the block. I must say that I've never been in a Sam Ash before. Maybe I'm not missing anything, after all, by not going to Sam Ash...

[LouSiffer]

I almost walked into the Sam Ash on Morse Rd a few weeks ago because I really needed some 12AX7's. But GC had them so I saved the trouble of going down the block. I must say that I've never been in a Sam Ash before. Maybe I'm not missing anything, after all, by not going to Sam Ash...

Yeah.....I get on Morse from 71 ( I live in Dublin )...I just drive by Sam Ash and go to GC. Also, check out Foley's in German Village.....small place, but, prices are good and he has oddball shit nobody else does.-Lou

[toejam]

The GC here sucks. The Sam Ash is a little better. I'd still rather go to the smaller mom & pop stores whenever possible.

[Axe Chemist]

Sam Ash is horrible. They opened a brand new store in San Antonio. I made the mistake of going there. I had to ask for a key to get into the bathroom, they literally handed it to me attached to a tire rim. Meanwhile, all the employees were gathered around a huddle in some sort of employee "gripe session" and totally ignored every other customer (which wasn't many) in the store. After spending 20 minutes walking around without being approached by an employee I decided to leave. As I walked out the door, someone finally asked if I needed any help. I said "yeah, about 20 minutes ago that question would've helped...too late now". SAD. No customer service = no managment.