Defying Court Judgment, Gander Mountain Plans DM Return

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Outdoor equipment retailer Gander Mountain Co. plans to enter the direct-marketing industry next year even though it recently lost the right to use its name for e-commerce purposes or on a catalog, a company spokesperson said yesterday.


A federal judge Aug. 18 ruled that Gander, which was spun off as a publicly held company in April 2004, lost the right to use its name and logo for direct marketing purposes when it sold its direct business in 1996 to Cabela's Inc., a Sidney, NE, outdoor gear and apparel cataloger.


The judgment isn't deterring Gander.


"We absolutely plan to enter the direct marketing business one way or another," said Shannon Burns, director of investor relations at Gander, St. Paul, MN.


The company is looking at both a catalog and an e-commerce vehicle and plans to launch one or both in time for the holiday 2006 season.


Gander's Web site at www.gandermountain.com currently serves primarily as a source of information about the company.


Gander hasn't decided whether or not it will appeal last week's decision, Burns said. However, if it does and loses, or if no appeal is made, the company is confident that there are "many ways to inform our customers that we're out there under a different name," Burns said.


One possibility is using one of Gander's private label brands not covered by the agreement with Cabela's.


For example, Guide Series is the company's largest private label brand and doesn't fall under the agreement, Burns noted.


Gander has been engaged in a two-year battle with Cabela's Inc. over which business has the right to use the Gander name to sell products via direct-marketing vehicles.


Cabela's acquired Gander's direct-marketing business nine years ago for $35 million. When Gander's previous owners were trying to avoid bankruptcy. It didn't succeed and the retail business was eventually acquired by Holiday Companies.


In 2003, a revitalized Gander started selling shotgun barrels on its Web site. When Cabela's said this violated the 1996 agreement and Gander disagreed, both companies filed lawsuits. The basis of Gander's lawsuit was that Cabela's hasn't used the Gander name for any commercial purposes.


Chantal Todé covers catalog and retail news and BTB marketing for DM News and DM News.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters


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