STATE OF FLORIDA

DEPARTMENT OF HIGHWAY SAFETY AND MOTOR VEHICLES

COPANS MOTORS, INC. d/b/a CHAMPION PORSCHE,

Petitioner,

vs.

PORSCHE CARS NORTH AMERICA, INC.,

Respondent.

/

HSMV Case No.: MS-18-1677 DOAH Case No.: 19-0177

FINAL ORDER NO.: 2021

HSMV-21-0022-FOF-MS

DEPARTMENT OF HIGHWAY SAFETY AND MOTOR VEHICLES

FINAL ORDER

This matter comes before the Department of Highway Safety and Motor Vehicles for entry of a final order upon submission of the Recommended Order issued October 12, 2020,1 by the Honorable Robert E. Meale, Administrative Law Judge of the Division of Administrative Hearings, resulting from a formal hearing conducted August 4 through 7, 2020. Upon review of the Recommended Order, which is attached and incorporated by reference, and the record in the above-styled cause, and being fully advised in the premises,

It is ORDERED that:

1. The Department adopts the Recommended Order as its final order, except that, for the reasons set forth in the Department’s rulings on Petitioner’s and Respondent’s exceptions in the attached appendix, the Conclusions of Law on page 72, paragraph 182, and page 73, paragraph 186, are modified as follows:2

   182. Based on these definitions of good faith, Respondent has proved that it acted in good faith in proposing to remove the Western Zip Codes and Southern Zip Codes from Petitioner’s PAR and reassign them to Porsche West Broward and The Collection, respectively. In making these determinations, the principals of Respondent acted with a reasonable foundation, honestly, and consistently with fair dealing. Respondent’s main witness presented as a paragon of these virtues. Nor has Respondent implemented the proposed modification to Petitioner’s PAR while this case is pending. Section 320.641(3) prohibits a distributor from implementing a challenged modification to an “[a]greement…,” but Respondent has taken the

   
   

   1 On December 23, 2020, pursuant to § 120.569(2)(l), Fla. Stat., both Petitioner and Respondent, at the request of the Department, extended the 90-day period for rendering the final order by 25 days. Accordingly, this final order is timely rendered.

   2 Words stricken in the substituted conclusions of law are deletions from the Recommended Order.

   
   

   Page 1 of 15

   COPANS MOTORS, INC. d/b/a CHAMPION PORSCHE v. PORSCHE CARS NORTH AMERICA, INC. HSMV Case No. MS-18-1677

   DOAH Case No. 19-0177

   
   

   Filed January 26, 2021 2:18 PM Division of Administrative Hearings

   position that the PAR is not part of the contract, so, at least from its perspective, this provision would not apply. Respondent thus has displayed some forbearance that is consistent with good faith. These conclusions are not undermined by Respondent’s failure to comply with the notice requirements of section 320.641(1), as it reasonably could have concluded that the parties’ contract did not include the PAR due to the unsettled status of this area of the law. Although a failure to provide compliant notice is a fact that may be considered in making findings as to good faith, such a failure cannot, as a matter of law, invariably result in a conclusion of a lack of good faith without equating a lack of good faith with noncompliant notice—an equivalence not found in the statute.

   ****

   186. Respondent has good cause to remove the Southern Zip Codes from Petitioner’s PAR and reassign them to the Porsche West Broward’s PAR, but not to The Collection’s PAR. This presents the final lumper versus splitter issue in this case: whether Respondent’s proof of good cause pertains merely to the removal of the zip codes from Petitioner’s PAR or pertains to their removal and reassignment to another dealer.

   The Department has substantive jurisdiction over these conclusions of law. The Department’s authority, however, does not extend—as concluded in paragraphs 182 and 186—to determining whether reassignment of the Western Zip Codes and Southern Zip Codes to another named dealer was proper or improper, but is limited to determining whether Respondent’s undertaking the reassignment itself was unfair, not undertaken in good faith, or not undertaken for good cause.

   § 320.641(3), Fla. Stat. Accordingly, the Department finds that the substituted conclusions are as or more reasonable than the conclusions of law in paragraphs 182 and 186;

2. Respondent’s proposed modification of the franchise agreement as to the Southern

   Zip Codes is VOID pursuant to § 320.641(1)(b), Fla. Stat.;

3. Petitioner’s claims under § 320.641(1)(a), Fla. Stat., as to the Western Zip Codes are DISMISSED; and

4. Petitioner’s claims under § 320.641(3), Fla. Stat., are DISMISSED as permanently moot for the Western Zip Codes and presently moot for the Southern Zip Codes.

Accordingly, it is further ordered that the case is CLOSED.

DONE AND ORDERED this

Leon County, Florida.

26th

day of

January , 2021, at Tallahassee,

FILED FLHSMV AGENCY CLERK JAN 26 2021

MS-18-1677

Robert Kynoch, Director of Motorist Services Department of Highway Safety and Motor Vehicles 2900 Apalachee Parkway

Tallahassee, Florida 32399

COPIES FURNISHED this 26th

day of January

, 2021, to:

A. Edward Quinton III, Esquire Quinton & Paretti P.A.

1 Southeast 3rd Avenue, Suite 1405

Miami, Florida 33131-1726 equinton@quintonparetti.com

Kenneth L. Paretti, Esquire Quinton & Paretti P.A.

1 Southeast 3rd Avenue, Suite 1405

Miami, Florida 33131-1726 kparetti@quintonparetti.com

James R. Vogler, Esquire Barack Ferrazzano Kirschbaum & Nagelberg LLP

200 West Madison Street, Suite 3900

Chicago, Illinois 60606-3465 jim.vogler@bfkn.com

Owen H. Smith, Esquire Barack Ferrazzano Kirschbaum & Nagelberg LLP

200 West Madison Street, Suite 3900

Chicago, Illinois 60606-3465 owen.smith@bfkn.com

Michael D. Educate, Esquire Barack Ferrazzano Kirschbaum & Nagelberg LLP

200 West Madison Street, Suite 3900

Chicago, Illinois 60606-3465 michael.educate@bfkn.com

Ed Broyles, Chief of Dealer Services Department of Highway Safety

and Motor Vehicles

Neil Kirkman Building, Room A-312 2900 Apalachee Parkway, MS 65

Tallahassee, Florida 32399-0635 edbroyles@flhsmv.gov

NOTICE OF APPEAL RIGHTS

A party adversely affected by this final order may seek judicial review as provided in

§ 120.68, Fla. Stat., and Fla. R. App. P. 9.190. Judicial review is initiated by filing a notice of appeal with the Agency Clerk, and a copy of the notice of appeal, accompanied by the filing fee, with the appropriate district court of appeal. The notice of appeal must conform to the requirements of Fla. R. App. P. 9.110(d) and must be filed (i.e., received by the Agency Clerk) within thirty days of rendition of this final order.

Filing with the Department’s Agency Clerk may be accomplished by U.S. mail, express overnight delivery, hand delivery, facsimile transmission, or electronic mail. The address for overnight delivery or hand delivery is Joseph Gillespie, DHSMV Agency Clerk, Department of Highway Safety and Motor Vehicles, 2900 Apalachee Parkway, A-432, MS-2, Tallahassee, Florida 32399. The facsimile number is (850) 617-5112. The email address is OGCFiling@flhsmv.gov.

Page 4 of 15

COPANS MOTORS, INC. d/b/a CHAMPION PORSCHE v. PORSCHE CARS NORTH AMERICA, INC. DOAH Case No. 19-0177

HSMV Case No. MS-18-1677

Docket for Case No: 19-000177

Orders for Case No: 19-000177