MOUNT VERNON, Mo. — A jury returned a $51.5 million verdict against retail giant Wal-Mart Stores Inc. for the way it ended a business deal with a vending company.
The jury reached its verdict Wednesday after a three-day trial in Lawrence County Circuit Court. The jury awarded $1.5 million in actual damages to Service Vending Co. and $50 million in punitive damages.
Bill Wertz, a spokesman for Wal-Mart, said the verdict will be appealed.
“We were definitely disappointed in the outcome,” Wertz said. “We felt the facts demonstrated pretty clearly we had every right to do what we did.”
Lawrence County Circuit Clerk Cindy Faucett said Wal-Mart has 30 days from Wednesday to file its appeal.
The Aurora-based Service Vending places and manages vending machines in retail outlets. In its contract with Wal-Mart, which was terminated in 1998, the company had 7,008 vending machines in 440 stores in 13 states.
Jim Newberry, a lawyer for Service Vending, said the contract termination was not at issue in the trial, but rather Wal-Mart’s actions after that agreement ended.
“Wal-Mart had the right to stop doing business with us,” Newberry said. But Wal-Mart “put up roadblocks that made it impossible for us to sell that equipment.”
Newberry said Service Vending was in negotiations to sell its equipment in 275 stores to Store Service Inc. That company was going to handle vending services at those stores.
But Wal-Mart required Service Vending to remove the equipment from stores before it could be sold, Newberry said. This requirement made the deal unattractive, and the equipment sale fell through.
Tyler Sumners, president of Service Vending Co., said the company lost 42 percent of its business when Wal-Mart ended the agreement. Wal-Mart’s business brought about $3 million a year to Service Vending, Newberry said.
“I’m proud that we were able to survive for three years with that much of our business gone,” Sumners said. “This (verdict) just assures that we’ll still be in business next year.”
Service Vending filed its suit in Lawrence County Circuit Court on July 15, 1999.
Service Vending Co. entered into its agreement with Wal-Mart in February 1992, according to the lawsuit. Among the provisions were terms under which Wal-Mart could terminate the agreement.
The agreement stated that once the agreement was terminated, the equipment belonging to vendor should be removed from Wal-Mart property within 10 days.
Newberry said Service Vending was singled out for special treatment, adding that machines are bought and sold in the same place all the time in the vending machine business.
“Everyone else but Service Vending has been allowed to sell and take whatever time they need,” Newberry said.
Wal-Mart attorney Todd Guthrie said while the contract called for the equipment to be removed in 10 days, an extension was granted to 30 then 60 days, which he said showed good faith.
Newberry said such a transaction involving so many stores couldn’t be done in such a short period of time.
“Wal-Mart had no reasonable explanation, no business explanation” for its requirements, Newberry said.
