Caterpillar, 'Mr. Vietnam' sue each over failed dealer agreement
Caterpillar Inc.'s Singapore unit sued its former distributor in Vietnam for failing to pay $11.9 million. The dealer countersued, accusing the world's largest maker of construction equipment of wrongly ending the agreement.
Peoria-based Caterpillar, with operations in Aurora, claims V-Trac Holdings Ltd., controlled by American businessman Anthony Salzman, failed to pay for products already delivered after the distributorship agreement ended, according to court papers filed with the Singapore High Court.
V-Trac has in turn sued Caterpillar and 10 others, including Caterpillar President Richard Lavin, for unexpectedly ending the agreement and for "destroying its credibility in Vietnam," the distributor said in its February defense and counterclaim.
"The relationship between the two parties had deteriorated significantly," Caterpilla said in its court filing. The company "sought to reach an amicable separation and transition the dealership to a third-party," according to the filing.
Caterpillar spokesman Jim Dugan said the company doesn't comment on ongoing legal issues. Salzman couldn't immediately be reached at his office and didn't respond to an e-mail.
V-Trac, Caterpillar's distributor since 1994, claimed it lost S$70 million ($55 million) from the fair value of the dealership, which ended around 2008. The distributor's employees were also induced to defect and take confidential information, breaching their employment agreements, V-Trac said.
Salzman was awarded the Friendship Medal by Vietnamese President Nguyen Minh Triet in May and is popularly known as "Mr. Vietnam," according to the American Chamber of Commerce in Vietnam's website.