Friday, November 5, 2004

Gutter-lid suppliers slug it out in court

Suits involve trade secrets, customer lists and depictions by competitors

By James McNair
Enquirer staff writer

Mike Berne of Bellevue climbs onto the roof with a blower to clear his gutters. Berne so far hasn't installed one of the shielding devices that are guaranteed to keep gutters clear.

As you lean over the top of your ladder and scoop slimy, decomposing leaves from the clogged gutters of your home, a growing number of companies in town are battling to spare you the dreary task.

Throughout the year, makers of newfangled gutter systems bombard Greater Cincinnati consumers with the virtues of their products, which cost several thousand dollars, depending on home size. Some make systems with covers, others with screens. They show them at home expos. They tout them in advertising fliers mailed to homes. They all claim to outperform the competition.

"No other product compares to Leafilter."

"Gutter Shutter - America's finest leaf and debris system."

"LeafGuard is the best gutter protection system on the market."

However, economic competition has given way to legal hostilities. Gutter systems companies are filing suit against rivals, accusing them of breaking laws in a national marketplace estimated to be worth hundreds of millions of dollars annually.

The following matches are under way:

•  In January, Gutter Shutter of West Chester filed a suit against a former salesman, Richard Bruce. The company said Bruce was fired by Gutter Shutter in October 2003 and went to work for Gutter Wizard, the Michigan-based maker of a gutter-fabrication machine. It said Bruce recruited Gutter Shutter employees and pirated trade secrets in violation of his employment agreement.

Bruce has not responded to the Hamilton County Common Pleas lawsuit and could not be reached for comment.

•  In May, Gutter Shutter followed that suit with a Hamilton County Common Pleas case against a former area sales manager, Ernest Durbin, who quit in January to start a local operation called Gutter Genie.

Gutter Shutter alleges Durbin hired away six employees and absconded with company trade secrets and customer lists.

Durbin replied that he hired the ex-Gutter Shutter employees after they left that company. He said Gutter Genie finds customers on its own.

•  Last month, Gutter Topper of Amelia filed a federal lawsuit against Gutter Helmet of Holland, Mich. It accused its rival of besmirching its reputation by depicting its product in a false light in marketing videos. It said Gutter Helmet broke trademark law by employing Gutter Topper's name as a keyword that directs Internet queries to the Gutter Helmet Web site.

Gutter Helmet, the pioneer of the industry 25 years ago, denied the allegations.

Prices for gutter systems run the gamut.

Paul Zondlak, new products adviser to Gutter Wizard, said dealers will start as high as $26 per linear foot, but will go as low as $9. Homeowners commonly pay several thousand dollars for systems that eliminate the need to mount ladders and dredge leaves by hand.

"I can't tell you how many times women have told their husbands to get out their checkbooks because they want them around a few more years," Zondlak said. "That's why it's a hot industry."

Celebrities rake it in

It's also a celebrity-filled industry. The October editions of two direct-mail fliers carry ads and discount coupons from GutterShutter, Gutter Genie and several others that aren't involved in the current flurry of litigation - LeafGuard, Leafilter and Gutter Pro.

Joe Nuxhall and Nick Clooney endorse the Leafilter system. TV weatherman Willard Scott pitches Gutter Helmet. Paul Harvey drops the name of yet another company, LeafProof, during his radio news program.

The half-dozen or so makers of higher-tech gutter systems in Greater Cincinnati manage to steer clear of invoking much consumer wrath, based on reports from the Cincinnati Better Business Bureau and the Cincinnati office of Angie's List, a for-profit company that compiles ratings of home and auto repair companies from consumers.

"I think the competition is fierce, but as an industry they're generally behaving themselves," said BBB president Jocile Erlich.

"I do know they have choice things to say about each other in conveying that they're the best and pointing out the shortcomings of their competitors," said Amy Whisenhunt, market manager for Angie's List in Cincinnati. But, again, no rash of consumer complaints.

Elizabeth Schellenger, for example, praises the LeafGuard system she had installed on her house in Colerain Township two years ago.

"I love the LeafGuard," said Schellenger, an Angie's List member. "They don't clog. The leaves and everything go right over the gutter, just like the pictures show."

Selling season

Since their products are designed specifically to prevent fallen leaves and debris from clogging gutters, this is the time of year when vendors pump up the marketing and turn leaves into cash.

Gutter Shutter claims to do the biggest volume of local business. Gutter Genie, the company launched by Gutter Shutter's former sales manager, issued an in-your-face challenge by opening in Gutter Shutter's home turf, West Chester. That in itself didn't rankle Gutter Shutter's president, Lee Brown. But he does accuse Durbin of misappropriating trade secrets and customer lists.

"When we go and see a customer, it's like they've seen us twice," Brown said. "It's a nightmare for our representative to go in and sit down and explain why they're seeing the same demonstration. It makes customers very apprehensive and standoffish. Sometimes they don't even let us in."

Durbin, however, never signed Gutter Shutter's 12-month noncompete agreement and says Gutter Shutter's claims are baseless. Hamilton County Common Pleas Judge Melba Marsh denied Gutter Shutter's request for a temporary restraining order in June, and the case is pending today.

Gutter Shutter had better luck with its former salesman, Richard Bruce. Hamilton County Common Pleas Judge Ethna Cooper restrained Bruce from selling gutter-related products or approaching Gutter Shutter employees. Gutter Shutter claims Bruce disregarded the order. It wants him held in contempt of court.

Topper vs. Helmet

Perhaps the strongest allegations of over-the-top behavior are contained in Gutter Topper's lawsuit against Gutter Helmet.

Gutter Topper is a manufacturer with 140 dealers in 42 states and four Canadian provinces, said CEO Slate Kirk. It accuses its Michigan rival of producing promotional videotapes purporting to show Gutter Topper's product collapsing under its own weight and coming apart in a mild wind. It also accuses Gutter Helmet distributors of making false remarks about Gutter Topper's financial strength.

"This industry's nuts," Kirk said. "This whole year I've been playing attorney against people lifting our trademarks or stealing our brochures. It makes the whole industry look bad."

David Skelton, Gutter Helmet's marketing and sales director, did not deny his company's use of the videos.

"At the time we created the videos, they were true," Skelton said. "But they've changed their product since then and we withdrew the videos two years ago."

Skelton pooh-poohed Gutter Topper's other allegations.

"We have absolutely no idea what they're talking about," he said. "They're making allegations with no specific dates or times. They're not even a blip on our radar screen."

Growing market

The current bickering could be just the beginning. Skelton estimates U.S. sales of covered or screened gutter systems are growing at up to 40 percent a year. Zondlak said Atlanta and Cleveland are the largest markets. What might appear to be cutthroat competition in Cincinnati, he said, is tame compared to the gutter wars elsewhere.

"Cincinnati's not really that competitive yet," Zondlak said. "Compared to Cleveland, they're novices."


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