Toro sues Steel Green

Toro sues Steel Green

The lawsuit claims Steel Green’s employees stole information from Toro to manufacture their own competitive products after Toro acquired L.T. Rich.

January 16, 2019

The Toro Company filed a lawsuit against new lawn care applicator manufacturer Steel Green Manufacturing in October of last year.

The complaint centers around Toro’s acquisition of L.T. Rich, makers of the Z-Plug and Z-Spray, in March of 2018. The now-former employees of LT. Rich launched their own lawn care equipment line in August of 2018.

“Given this is an ongoing litigation, there’s not much we can say at this time,” said Branden Happel, senior manager of public relations for The Toro Company, in an email. “This is not the path we wanted to take, but we must defend and protect our intellectual property rights, trade secrets and proprietary information.”

The complaint, filed in the U.S. District Court, Southern District of Indiana, states:

"This case concerns the Steel Green Individuals’ — each a former employee of L.T. Rich and Toro — coordinated departure from Toro and their systematic effort to harvest sensitive, confidential, proprietary, trade secret information from Toro’s information technology systems while simultaneously plotting to manufacture, distribute, and sell competitive products.

"Shortly after the acquisition and the Steel Green Individuals’ departure from Toro, the Steel Green Individuals began to publicly represent their intention to manufacture and distribute products competitive to Toro’s products, contrary to their legal duties and obligations to Toro."

Steel Green responded to the lawsuit with the following statement via email to Lawn & Landscape, claiming the founders of Steel Green were never employed by Toro.

“Toro’s allegations against Steel Green and its employees are meritless. Steel Green’s employees never signed any agreements with Toro, and they were never Toro employees. They have not misused any ‘secrets’ of Toro. They are using their years of experience in the industry to build a different and better machine. Steel Green and its employees are vigorously defending Toro’s lawsuit. They will continue building and selling their machines to their customers, and they look forward to their day in court.

The complaint filed by Toro also alleges that Steel Green’s founders communicated with Toro’s clients and customers regarding a joint venture to compete with Toro, ultimately resulting in the creation of SGM.

The filing also alleges that:

• While still employed with Toro, accessed Toro’s information technology system with intent to remove Toro’s confidential, proprietary, and trade secret information;

• While still employed with Toro, used Toro’s information technology system to send to their personal email accounts emails with sensitive information and other data regarding Toro’s business, including among other things, the identities of customers, clients, distributors, and/or vendors;

• While still employed with Toro, harvested data, including sensitive product engineering and production drawings, manufacturing specifications, client information, and sales and marketing data from Toro’s information technology systems intended to be used in connection with unfairly competing against Toro; and

• While still employed at Toro, used Toro equipment to develop and design competing products.”

Steel Green’s founders named in the suit are Matthew P. Smith, Michael D. Floyd, R. Scot Jones, Brent A. Mills and Craig M. Conyer. Steel Green Director of R&D James W. Kepner is also named in the lawsuit.