Weve been waiting for the other shoe to drop as Callaway Golf Company moves to consolidate the operations of its recently acquired Top-Flite Golf divisions.
As reported in SEW_0342, Callaway consolidated most of its ball-making operations into the Top-Flite facilities in Chicopee, MA and is now moving the Ben Hogan club business from Fort Worth, TX to Carlsbad, CA. The move is expected to be completed early in 2004.
Ron Drapeau, Callaway's chairman and CEO, told the local San Diego paper that 35 Ben Hogan employees would be terminated, and replaced by current employees at the Carlsbad ball-making facility that has little use since the ball consolidation. Drapeau also said a handful of Hogan employees will remain in Fort Worth where they will handle customized clubs for Hogan's tour professionals.
The Hogan club business was founded by golfing legend Ben Hogan in 1953 and released its first set of clubs a year later. Hogans forged blade irons are reportedly most popular with more seasoned purist golfers, but have not caught on with the mid-tier golfer that Callaway relies on for volume.
The move will lower Hogan's costs, according to Casey Alexander, an analyst with Gilford Securities. But he warned in the report that the move could result in cultural problems between the two brands, saying, “I think that's going to be an issue.”
Callaway closed its $180 million acquisition of Top-Flite in September.
Drapeau also announced that all the contents of Mr. Hogan's office in Fort Worth, which have been preserved intact since his death in 1997, will be donated to the World Golf Hall of Fame at the World Golf Village in St. Augustine, FL.
And Stays Vigilant in Knock-Off Pursuit
Callaway is still taking the aggressive track with counterfeiters, announcing last week that a federal court in Florida has issued an order on December 2 blocking a Florida golf club importer and retailer from importing and selling illegal copies of the Odyssey White Hot 2-Ball Putter.
The order comes on the heels of an agreement Callaway struck with International Golf in Orlando Warehouse after ELY sued IGW for importing and selling illegal copies of the Odyssey White Hot 2-Ball Putter. IGW agreed to stop selling the “Boss Type 007”, the “Tomahawk Sniper”, and several other copies of the White Hot 2-Ball Putter.
IGW, which had to pay Callaway an undisclosed amount of money in the settlement, forfeited 3,500 knock-off clubs in the agreement.
The court order applies to the defendant and “all persons acting in concert with the defendant who have actual notice of the order”.
Callaway has also filed a lawsuit in Tampa Bay against importers Tony Liu, Jeff Parrot and E.L. Golf, Inc., who do business as Chicago Golf. That suit alleges that Chicago Golf sells the “White Shot Twin Ball” putter that allegedly infringes trademarks and patents covering the Odyssey White Hot 2-Ball Putter. The suit is pending.
These actions come as Callaway continues pursue the sellers and makers of knock-off golf clubs and accessories. In August, Callaway went as far as China to bust up a counterfeiting ring that sold clubs through the eBay Web site. In August, Callaway settled with another group of defendants in the “Big Easy” knock-off scam which netted the company tens of thousands of knock-off club heads and medallions and resulted in payouts in excess of $1 million to Callaway.
