by Martha Cooke | March 01, 2004

Tim Farrel

Tim Farrell, AHMA president

The rift between the American Hardware Manufacturers Association and Reed Exhibitions widened in early 2004, as the Schaumburg, Ill.-based association brought a lawsuit against its former show manager.
    The suit accuses Norwalk, Conn.-based Reed of taking kickbacks from its general contractor, Dallas-based Freeman Decorating Co., concealing revenues from the association and increasing its profits at the
expense of exhibitors by hiking drayage labor fees.
    This follows a separation agreement signed last year by the AHMA and Reed after more than two decades of working together. Reed, which owns the National Hardware Show name, moved the May 2004 show from Chicago to Las Vegas without the support of the association, which launched its own AHMA Hardware Show, to take place in Chicago in April.
    “The lawsuit is completely without merit,” said Rob Cappiello, industry vice president of the National Hardware Show, Reed Exhibitions. Cappiello dismissed the action as a publicity stunt, saying that the AHMA show had attracted less support and attention than did Reed’s event. He argued further that Reed’s dealings with show vendors were all consistent with “a normal business relationship.”
    Yet, said AHMA president and CEO Tim Farrell, exhibitor complaints about the high cost of participation helped lead the hardware group to reconsider its relationship with Reed; he added that a subsequent internal investigation uncovered the unorthodox rate and payment structures.