2006-06-14 CHEP, Puerto Rico company settle pallet dispute

CHEP USA, a locally based global leader in pallet and plastic container pooling services, announced Friday it had reached an out-of-court settlement with a Puerto Rico company over the use of its pallets.

HC Wooden Pallets, headquartered in Rincon, Puerto Rico, had sued CHEP USA for breach of contract, accusing the Orlando-based company of terminating various service center agreements.

CHEP was in the process of preparing a counterclaim, for among other things, conversion of CHEP's assets, before the two companies settled.

Under the agreement, HC Wooden agreed to participate in the CHEP Asset Recovery Program, acknowledging CHEP's sole and exclusive ownership in the blue-marked pallets, and that only CHEP has the right to buy, sell or trade those pallets.

The program allows CHEP to recover its assets that come into possession of pallet recyclers and offers fair compensation to the pallet recycling industry.

Hector Caro Ramos, president of HC Wooden Pallets, says he is satisfied with the resolution.

"I see no benefit for the parties to continue litigation," Ramos says.

Elton Potts, senior vice president of asset management for CHEP, says the company has "worked very hard to put in place a fair and equitable program."