STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
KAWASAKI MOTOR CORPORATION USA ) and ACTION JET SPORTS, INC., )
)
Petitioners, )
)
vs. ) Case No. 99-1766
)
GRANNY'S MOTORSPORTS, )
)
Respondent. )
)
RECOMMENDED ORDER
Pursuant to notice, a formal hearing was held on December 13-14, 1999, in Sarasota, Florida, before Carolyn S. Holifield, a duly-designated Administrative Law Judge of the Division of Administrative Hearings.
APPEARANCES
For Petitioner Kawasaki Dean Bunch, Esquire Motors Corporation, Kelly A. O'Keefe, Esquire U.S.A.: Sutherland, Asbill and
Brennan, L.L.P.
2282 Killearn Center Boulevard Tallahassee, Florida 32308
For Petitioner Action Charles D. Bailey, III, Esquire Jet Sports, Inc.: Bowman, George, Scheb,
Toale and Robinson
22 South Tuttle Avenue, Suite 3 Sarasota, Florida 34237
For Respondent: Andrew H. Cohen, Esquire
Hankin, Perrson, Davis & Darnell 2033 Main Street, Suite 400
Sarasota, Florida 34237
STATEMENT OF THE ISSUES
Whether the application of Kawasaki Motors Corporation USA (Kawasaki Motors) to establish an additional franchised dealership for the sale of Kawasaki motorcycles to be located at Action Jet Sports, Inc. (Action Jet), 2705 1st Street, Bradenton, Manatee County, Florida, should be granted.
PRELIMINARY STATEMENT
By publication in the March 12, 1999, Florida Administrative Law Weekly, Petitioner, Kawasaki Motors, provided notice of its intent to allow the establishment of Petitioner, Action Jet, as a dealership for the sale of Kawasaki motorcycles at 2705 1st Street, Bradenton, Florida. Pursuant to Section 320.642, Florida Statutes, Respondent, Granny's Motorsports, timely filed a protest of the establishment of the proposed dealership with the Department of Highway Safety and Motor Vehicles (Department).
By letter dated April 15, 1999, the Department transmitted the letter of protest to the Division of Administrative Hearings for assignment of an Administrative Law Judge to conduct a formal hearing.
At hearing, Petitioner Kawasaki Motors presented the testimony of two witnesses: Thomas Longo of Urban Science Applications, Inc., who was accepted as an expert in dealer network analysis; and Jim Capps, regional sales manager for Kawasaki Motors. Petitioner Kawasaki Motors had two exhibits received into evidence, Petitioner's Exhibits numbered 1 and 9.
Petitioner's Exhibit numbered 1, a composite exhibit, consisted of pages 1A, 2, 3A-6A, 7-11, 12A, 13-19, 20A-24A, 25-27, 28A, 29A, 29AA, 30, 31A, 32-35, 36A, 40, 41A, 42A, 44A (deleting the
left-hand column), 45-47, A1-A42, and A44-A49. Petitioner Action Jet adopted the case presented by Kawasaki Motors. Respondent presented the testimony of three witnesses: Edward Lemco, chief executive officer of Lemco and Associates, who was accepted as an expert in motorcycle dealer operation and motorcycle retailing; Steve Granham, owner and president of Granny's Motorsports; and Bob Glenn, general manager of Granny's Motorsports. Respondent's Exhibits numbered 1-3 and 6-15 were offered and received into evidence.
At the close of the hearing, the parties requested and were allowed 20 days from the filing of the transcript within which to file their proposed recommended orders. The Transcript of the proceeding was filed with the Division of Administrative Hearings on January 24, 2000. Both parties filed Proposed Recommended Orders which have been carefully considered in preparation of this Recommended Order.
FINDINGS OF FACT
Based on the evidence presented at the hearing and the record as a whole, the following findings of fact are made:
Petitioner Kawasaki Motors, is a licensed distributor of motor vehicles in Florida and is authorized to sell motor vehicles to its dealers in Florida.
Petitioner Action Jet is a licensed motor vehicle dealer in Florida and is located at 2705 1st Street, Bradenton, Florida.
Respondent Granny's Motorsports is a licensed motor vehicle dealer in Florida and an existing Kawasaki dealer located at 2001 University Parkway, Sarasota, Florida.
In 1991, Granny's Motorsports was formed from the purchase of an existing dealership known as "Cycles N' Stuff" located on 17th Street in Sarasota, Florida. However, with the approval of Kawasaki Motors, Granny's Motorsports relocated to its present location in July 1997.
Granny's Motorsports sold the full product line of licensed motor vehicles for Kawasaki, Yamaha, and Suzuki at its 17th Street location and currently sells the full product line of these manufacturers.
Petitioner Kawasaki Motors proposes to allow the establishment of Action Jet as a dealership for the sale of Kawasaki motorcycles.
Granny's Motorsports has standing to protest the proposed establishment of Action Jet as a Kawasaki motorcycle dealership pursuant to Section 320.642(3), Florida Statutes.
This proceeding is governed by Section 320.642, Florida Statutes, which sets forth the conditions for establishment of an additional dealer if a protest is filed. According to that provision, Kawasaki Motors will be allowed to establish a new dealership if the existing franchised dealer is not providing
adequate representation of Kawasaki vehicles in the subject community or territory. While that provision lists factors which may be considered in making this determination, the statute does not define "community or territory" or "adequate representation."
A determination of what constitutes the appropriate "community or territory" is a question of fact that must be made on a case-by-case basis.
To determine whether a market is so connected as to form a community or territory, there must be significant cross- sell between the existing dealer in Sarasota/Bradenton and the fringe dealers, those in the surrounding area, to consider if they are, in fact, acting as one market.
The consumer data used for analysis of sales in the motorcycle industry is assembled and provided by the Motorcycle Industry Council (MIC). Although MIC data contains information for all motorcycle products for the purposes of establishing adequacy of representation under Section 320.642, Florida Statutes, only information relative to on-road motorcycles and dual-purpose motorcycle sales has been considered.
Six Kawasaki dealers in Pinellas, Hillsborough, Polk, and Charlotte counties occupy the area surrounding the Manatee and Sarasota county area. Consumer behavior data indicates that very few of the Kawasaki sales made by these six dealers are made to customers residing in Sarasota and Manatee counties. Rather,
the vast majority of the sales into Sarasota and Manatee counties is made by Granny's Motorsports.
After excluding these fringe dealers from the potential community or territory, it was necessary to determine whether there was sufficient cross-sell within Sarasota County and Manatee County to determine whether these two counties are connected from a Kawasaki marketing standpoint. However, because the proposed dealer in Bradenton is not in place yet and there is only one existing dealer in the area, there is no cross-sell and this analysis is not possible.
Analysis of consumer behavior and cross-sell patterns demonstrate that, for Kawasaki motorcycles, Sarasota and Manatee counties are a single market and comprise the Bradenton/Sarasota community or territory for the purpose of analysis under Section 320.642, Florida Statutes.
A primary market area (PMA) or identifiable plot, in which an existing or proposed resident dealer has or should have a competitive advantage over same line-make dealers by virtue of the resident dealer's location. Each dealer, including Granny's Motorsports, is assigned a primary market area of a radius of five miles around his dealership. However, this distance was considered to be too small to constitute a reasonable area for market analysis.
The starting point for establishing the PMAs for Granny's Motorsports and the proposed Bradenton dealership,
Petitioner Action Jet, was the assignment of zip codes within the Bradenton/Sarasota community or territory. Utilizing this process, generally, zip code areas closest to Granny's Motorsports were assigned to that dealer and those zip code areas closest to the proposed Bradenton dealership, Action Jet, were assigned to that dealership. However, in certain instances, although the center of a zip code was closer to one dealer, the roads and traffic patterns suggested that a zip code should be assigned to a different dealer's PMA. This situation was present in this case and, accordingly, several zip codes were assigned on a basis other than distance.
The Sarasota PMA is the area in which Granny's Motorsports is located and in which it has a geographic advantage. Moreover, Granny's Motorsports will continue to have that advantage even after the establishment of Action Jet. The Bradenton PMA is the area in which the proposed Action Jet dealership would have an advantage upon its establishment.
In the Bradenton/Sarasota community or territory, there are eleven competing line-make motorcycle dealers.
To determine whether the existing Kawasaki dealers are providing "adequate representation" in the Bradenton/Sarasota community or territory, the factors enumerated in Section 320.642, Florida Statutes, may be considered.
The most common measure for evaluating the performance of a dealer network is analysis of market penetration data.
Market penetration represents the competitive efforts of all the dealers, using data concerning the sale of all brands to comprise a single indicator also called market share. This is the single most objective and accurate measure of market activity. Market share represents the sales of a manufacturer, such as Kawasaki, in proportion to the business available.
To develop a standard to measure adequacy of representation for the Bradenton PMA, the Sarasota PMA, or the community or territory, the first step is to attempt to locate an area near the area being studied, but which does not overlap with that area where Kawasaki is adequately represented.
After adjusting for product popularity differences, the Polk County standard offers the most appropriate expected market penetration against which to judge the performance of Kawasaki in the Bradenton/Sarasota community or territory and in the Bradenton and Sarasota PMAs which make up that community or territory.
In this case, Polk County, which is adjacent to the Bradenton/Sarasota community or territory, appears to be adequately represented because it exceeds the Florida average for Kawasaki. The Florida average is a conservative standard because it takes into consideration Kawasaki's performance in areas with adequate, inadequate, and no representation.
Polk County is also an appropriate starting point for determining a reasonably expected market penetration because it
represents actual experience of the Kawasaki penetration which is being obtained in an adjacent area. However, when comparing one market to another, adjustments must be made for consumer preferences which might differ from one market to another. This is important because consumer preferences among different types of motorcycles, independent of brand, are beyond the control of the dealers.
Market segmentation adjusts for consumer preferences which differ between markets. Sales data by segment reflects actual consumer purchases, implicitly accounting for the effects of all demographic characteristics including age, income, education, size-class preferences, and product popularity on vehicle purchase behavior.
In this proceeding, only on-road motorcycle and dual- purpose motorcycles are considered. With regard to these categories, the MIC classifies motorcycles into five segments. These segments list models which are comparable to one another and are presumably, competing for the same customers.
By measuring Kawasaki's penetration in each segment achieved in Polk County, compared to the opportunity available in each segment in the Bradenton/Sarasota community or territory, an appropriate standard is established for what the Bradenton/Sarasota community or territory should expect if it were receiving adequate representation.
Using the Polk County average and adjusting for local segment popularity, the reasonably expected market share for Kawasaki on-road and dual-purpose motorcycles in the Bradenton/Sarasota community or territory was 16.47 percent in 1996; 13.69 percent in 1997; 16.70 percent in 1998; and 16.21 percent for the first nine months of 1999.
Alternatively, using the more conservative Florida average as a standard and adjusting for product popularity, Kawasaki in the Bradenton/Sarasota community or territory would be expected to achieve 16.24 percent in 1996; 13.49 percent in 1997; 13.94 percent in 1998; and 12.89 percent for the first nine months of 1999.
The reasonably expected segment penetration for Polk County, adjusted for local segment popularity, is accepted as the appropriate standard against which to judge the performance of the Bradenton/Sarasota community or territory.
After making the market segment adjustments, Kawasaki Motors' market penetration in the Bradenton/Sarasota community or territory was below reasonably expected levels for the period 1996 through the last nine months of 1999. This is the case whether using the Polk County average or the Florida average.
The actual penetration of Kawasaki in the Bradenton/Sarasota community or territory was 13.69 percent in 1996; 10.37 percent in 1997; 9.12 percent in 1998; and 6.81 percent for the first nine months in 1999.
Using the Polk County average standard, from 1996 through the first nine months of 1999, the Bradenton/Sarasota community or territory's performance declined from 83 percent of expected in 1996 to only 42 percent of expected in 1999. By comparison, utilizing the Florida average as a standard, the Bradenton/Sarasota' performance went from 84.3 percent of expected in 1996 to only 52.9 percent of expected in 1999.
The net shortfall in units, or the number of on-road and/or dual-purpose motorcycles, which would be required to be sold in order to bring Kawasaki in the Bradenton/Sarasota community or territory up to the expected performance, was 12 units in 1996, 16 units in 1997, 44 units in 1998, and 51 units in 1999. Using the more conservative Florida standard, the net shortfall increased from 11 in 1996 to 33 in 1999. Similar patterns emerge when Kawasaki's penetration in the Bradenton PMA and the Sarasota PMA is compared with expected penetration based upon the Polk County and Florida standards.
Utilizing the segment analysis, Kawasaki's actual performance compared to expected in the Bradenton PMA has fallen from 85.7 percent of expected in 1996 to 53.8 percent of expected in the first nine months of 1999. A temporary effect of the relocation of Granny's Motorsports north to its new location, which opened in July 1997, can be seen as the actual penetration reached 100 percent of expected in 1997. However, since that time, the performance of the Bradenton PMA has continued to fall
to a point substantially lower than it was prior to the relocation. Similar results are seen when the Bradenton PMA's performance is compared to the Florida average.
Kawasaki's representation in the Sarasota PMA, where Granny's Motorsports is located, also has fallen consistently for the past four years. Using the Polk County standard, Granny's Motorsports went from achieving 82 percent of its expected penetration in 1996 to 35.9 percent in 1999. By comparison, using the Florida standard, the Sarasota PMA went from achieving
83.7 percent of its expected penetration in 1996 to 46 percent in 1999.
The steady decline over time demonstrates that Granny's Motorsports, the only dealer in the Bradenton/Sarasota community or territory, may not be able to adequately represent Kawasaki in its own PMA because it is attempting to cover an area which is too large for it to adequately serve.
In terms of reasonably expected market penetration, the Bradenton/Sarasota community or territory, as well as the Bradenton PMA and the Sarasota PMA, are not receiving adequate representation for Kawasaki.
Factors contributing to Kawasaki's receiving inadequate representation in the Bradenton/Sarasota community or territory and in the Bradenton PMA and the Sarasota PMA may be the number and location of the dealers. However, a determination that the establishment of a second dealership in the Bradenton/Sarasota
community or territory is warranted must be based on the economic and marketing conditions pertinent to dealers competing in the community or territory, including anticipated changes.
The current and future demographic factors in the Bradenton/Sarasota community or territory indicate that the addition of a Kawasaki Motors dealer is justified in terms of economic or marketing conditions pertinent to dealers competing in the community or territory.
The Bradenton/Sarasota community or territory has experienced considerable economic and market growth. Since 1980, the community/territory has had a significant increase in the driving age population and households. This trend is predicted to continue through 2003. An additional indication of the economic growth is the increase in the annual employment. In Sarasota and Manatee Counties, the annual average employment has increased by approximately 52,000 jobs between 1990 and 1999.
The Bradenton PMA and the Sarasota PMA have also experienced substantial growth with such trends predicted to continue through 2003.
Demographic factors in both the Bradenton and Sarasota PMAs are conducive to selling new motorcycles. They both contain a reasonable mix of upper and middle income areas. The median household income of the new motorcycle buyer falls into the range of around $50,000.
In terms of the growth of the total motorcycle industry, as reflected by the on-road and dual-purpose segment, there has been a substantial increase in the amount of the total industry sales, for which Granny's Motorsports can compete, available since 1996. This increase is present in both the Bradenton PMA and the Sarasota PMA.
In light of the growth in the total available motorcycle market, measured by total industry sales, coupled with the demographic and employment characteristics, the inadequacy of representation is not due to local demographic or economic factors or lack of growth in the motorcycle industry. Rather, the inadequacy of representation is likely due the inability of one dealer to keep pace with the growth in the market.
The distance between Granny's Motorsports and the proposed Action Jet location is 7.8 miles and 19 minutes and 8 seconds driving time.
From a geographical standpoint, the Bradenton/Sarasota community or territory is large, approximately 40 to 50 miles from north to south. Despite this large area and the increase in the size of the motorcycle market, the Bradenton/Sarasota community or territory is served by only one Kawasaki dealer.
Establishment of an additional Kawasaki dealer is justified based on the size of the market in the Bradenton/Sarasota community or territory, measured in comparison to Polk County and the number of Kawasaki dealers and competitors
there. For example, in the Bradenton/Sarasota community or territory, where Kawasaki is receiving inadequate representation, Kawasaki has 9.1 percent of the franchises. In Polk County, where Kawasaki is receiving adequate representation, Kawasaki has
20 percent of the franchises. In order to have the same share of the franchises in Bradenton/Sarasota which it has in Polk County, Kawasaki would be required to have 2.5 dealerships. Therefore, in addition to the one dealership present in the Bradenton/Sarasota community or territory at this time, Granny's Motorsports, one additional Kawasaki dealer is needed.
The inadequate market penetration for Kawasaki demonstrates that there is insufficient inter-brand competition, or competition between dealers selling different brands. Moreover, there is no intra-brand competition between Kawasaki dealers because none of the other Kawasaki dealers in the surrounding area sell meaningful numbers of units into the Bradenton/Sarasota community or territory.
The proposed location in Bradenton has a concentration of motorcycle purchasers which justifies the placement of a Kawasaki dealership in Manatee County.
The establishment of the Bradenton dealership will likely benefit consumers and the public interest. It will provide the growing population of the Bradenton/Sarasota community or territory with a more convenient place to shop for Kawasakis and more convenient Kawasaki service.
The probable impact of the proposed additional dealership on the existing Kawasaki dealer can be determined by examining the gross sales loss in the Bradenton/Sarasota community or territory. The gross sales loss is the number of on-road and/or dual-purpose motorcycles sold in the subject community or territory by the competitive dealerships in that area. The gross sales loss in the Bradenton/Sarasota community or territory was 48 units for 1998. In addition to this opportunity being available to the existing Kawasaki dealer, there were 9 units of in-sell or Kawasaki units sold by dealers outside the Manatee and Sarasota Counties to local customers. Thus, there is a total lost opportunity of 57 units for which Granny's Motorsports can compete.
If the new proposed dealer is established, there will be no necessary negative impact on Granny's Motorsports because there is opportunity available to be captured from inter-brand competitors.
When a dealer is added to a market with inadequate representation, typically, competition is enhanced and the market for the product expands over what it otherwise would have been.
The addition of Action Jet will have a positive impact on consumers. It will provide additional competition and a much more convenient shopping alternative.
The addition of a dealership will likely benefit Kawasaki Motors in terms of additional sales of motorcycles and market share.
Granny's Motorsports has made a substantial investment in its current and previous facilities. In 1991, when Granny's Motorsports purchased an existing dealership located on 17th Street in Sarasota, extensive renovations were performed, the equipment was updated, and the staff was increased and trained.
In 1996, Granny's Motorsports purchased the property at which its present dealership is located. After applying for and receiving the approval of Kawasaki Motors, in July 1997, Granny's Motorsports moved into the new facility located on University Parkway in Sarasota. However, the University Parkway facility, which had previously been a boat manufacturing plant, required extensive renovations before Granny's Motorsports could occupy the facility. Granny's Motorsports' total investment in the new facility was about $1,000,000.
Although Kawasaki Motors approved the relocation of Granny's Motorsports, it never suggested or recommended the relocation. Therefore, the substantial costs associated with and resulting from Granny's Motorsports' relocation were not incurred to perform obligations under the dealer agreement between Kawasaki Motors and Granny's Motorsports. Rather, the investment and expenditures made by Granny's Motorsports were for the
business as a whole, which includes the sale of the full product line of not only Kawasaki, but also of Yamaha and Suzuki.
Granny's Motorsports' current location on University Parkway is near the Sarasota and Manatee County line and is centrally located between Sarasota and Bradenton and in the middle of two main clusters of population for the Bradenton/Sarasota community or territory. However, the market share deficiency suffered by Kawasaki demonstrates that the facility is not in a location from which Granny's Motorsports has been able to adequately represent Kawasaki in the community or territory and, in specifically in the Bradenton PMA.
By allowing Granny's Motorsports to relocate to the location it requested, Kawasaki Motors allowed Granny's Motorsports the opportunity to take advantage of the growing market within Manatee and Sarasota counties in the manner it requested to do so.
Granny's Motorsports has been in the University Parkway facility for over two years, but Kawasaki's market share continues well below an acceptable minimal standard and is declining.
Granny's Motorsports is an adequate facility and its owner and manager are doing what they believe is the best they can do to maximize their efforts to sell Kawasaki Motors product. Notwithstanding these efforts, Granny's Motorsports was not been
able to effectively service the entire Bradenton/Sarasota community or territory.
Prior to 1978, a Kawasaki dealership had been established in Bradenton. That dealership had coexisted with the dealership in Sarasota until it went out of business in 1993 because of an absentee owner and management and operation problems. In fact, when Granny's Motorsports brought its dealership in Sarasota in 1991, the Kawasaki dealership was operating in Bradenton. Kawasaki Motors believes that by replacing the dealership in Bradenton which had been very successful for many years, it will be able to better service the Bradenton/Sarasota community or territory.
Kawasaki Motors' low market share compared to expected in the Bradenton/Sarasota community or territory indicates that Kawasaki's one dealer network is currently unable to offer adequate inter-brand competition in the Bradenton/Sarasota community or territory.
The failure of the efforts of the existing Kawasaki dealer to reach the minimum expected market share in the Bradenton/Sarasota community or territory demonstrates that the existing Kawasaki dealer is not nearly capturing all reasonably available sales. There is significant untapped market opportunity available in the Bradenton/Sarasota community or territory. This is due, at least in part, to the size of the
market and a single dealer's inability to serve the entire market.
The market opportunity is so great that Action Jet, the proposed dealer to be established in the Bradenton PMA, likely will not be able to capture all of the increased sales from opportunity currently lost to inter-brand competitors. Therefore, Granny's Motorsports will have the opportunity to increase its current sales level. Having a convenient dealer in the Bradenton/Sarasota community or territory can stimulate new sales interest in Kawasaki across the market.
If existing Kawasaki dealers respond aggressively and offer competitive value, they will capture some of the increased sales generated by the presence of the additional dealer in the Bradenton/Sarasota community or territory.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties to and the subject mater of this proceeding pursuant to Sections 120.57 and 120.569, Florida Statutes.
Pursuant to Section 320.642, Florida Statutes, Granny's filed a protest of Kawasaki Motors' application to establish a motor vehicle dealership in Manatee County and to appoint Action Jet as a dealer of the Kawasaki licensed motor vehicle line.
The scope of the inquiry in the case is set forth in Section 320.642, Florida Statutes, which provides in pertinent part:
Any licensee who proposes to establish an additional motor vehicle dealership or permit the relocation of an existing dealer to a location within a community or territory where the same line-make vehicle is presently represented by a franchised motor vehicle dealer or dealers shall give written notice of its intention by certified mail to the department.
* * *
(2)(a) An application for a motor vehicle dealer license in any community or territory shall be denied when:
A timely protest is filed by a presently existing franchised motor vehicle dealer with standing to protest as defined in subsection (3); and
The licensee fails to show that the existing franchised dealer or dealers who register new motor vehicle retail sales or retail leases of the same line-make in the community or territory of the proposed dealership are not providing adequate representation of such line-make motor vehicles in such community or territory. The burden of proof in establishing inadequate representation shall be on the licensee.
(b) In determining whether the existing franchised motor vehicle dealer or dealers are providing adequate representation in the community or territory for the line-make, the department may consider evidence which may include, but is not limited to:
The impact of the establishment of the proposed or relocated dealer on the consumers, public interest, existing dealers, and the licensee; provided, however, that financial impact may only be considered with respect to the protesting dealer or dealers.
The size and permanency of investment reasonably made and reasonable obligations incurred by the existing dealer or dealers to perform their obligations under the dealer agreement.
The reasonably expected market penetration of the line-make motor vehicle for the community or territory involved, after consideration of all factors which may affect said penetration, including, but not limited to, demographic factors such as age, income, education, size class preference, product popularity, retail lease transactions, or other factors affecting sales to consumers of the community or territory.
Any actions by the licensees in denying its existing dealer or dealers of the same line-make the opportunity for reasonable growth, market expansion, or relocation, including the availability of line-make vehicles in keeping with the reasonable expectations of the licensee in providing an adequate number of dealers in the community or territory.
Any attempts by the licensee to coerce the existing dealer or dealers into consenting to additional or relocated franchises of the same line-make in the community or territory.
Distance, travel time, traffic patterns, and accessibility between the existing dealer or dealers of the same line-make and the location of the proposed additional or relocated dealer.
Whether benefits to consumers will likely occur from the establishment or relocation of the dealership which the protesting dealer or dealers prove cannot be obtained by other geographic or demographic changes or expected changes in the community or territory.
Whether the protesting dealer or dealers are in substantial compliance with their dealer agreement.
Whether there is adequate interbrand and intrabrand competition with respect to said line-make in the community or territory and adequately convenient consumer care for the motor vehicles of the line-make, including the adequacy of sales and service facilities.
Whether the establishment or relocation of the proposed dealership appears to be warranted and justified based on economic and marketing conditions pertinent to dealers
competing in the community or territory, including anticipated future changes.
The volume of registrations and service business transacted by the existing dealer or dealers of the same line-make in the relevant community or territory of the proposed dealership.
The burden of proof in this proceeding is on Kawasaki Motors, the licensee. Section 320.642(2)(a)2., Florida Statutes. In order to prevail, Kawasaki Motors must establish by a preponderance of the evidence that the existing franchised dealer, Granny's Motorsports, is not providing adequate representation of the same line-make motor vehicles in the designated community or territory.
Having weighed the statutory criteria enumerated in Section 320.642(2), Florida Statutes, in light of the facts found herein, Petitioner Kawasaki Motors has met its burden of proving by a preponderance of the evidence that the existing Kawasaki Motors dealer is providing inadequate representation to the Bradenton/Sarasota community or territory. A balancing of the statutory factors supports the conclusion that the benefits of establishing the proposed dealership outweigh any negative impact on Granny's Motorsports, the existing dealer.
Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Highway Safety and Motor Vehicles enter a final order approving the establishment of
Kawasaki Motors' dealership at Action Jet, 2705 1st Street, Bradenton, Florida.
DONE AND ENTERED this 8th day of May, 2000, in Tallahassee, Leon County, Florida.
CAROLYN S. HOLIFIELD
Administrative Law Judge
Division of Administrative Hearings The DeSoto Building
1230 Apalachee Parkway
Tallahassee, Florida 32399-3060
(850) 488-9675 SUNCOM 278-9675
Fax Filing (850) 921-6847 www.doah.state.fl.us
Filed with the Clerk of the Division of Administrative Hearings this 8th day of May, 2000.
COPIES FURNISHED:
Dean Bunch, Esquire
Kelly A. O'Keefe, Esquire
Sutherland, Asbill and Brennan, L.L.P. 2282 Killearn Center Boulevard Tallahassee, Florida 32308
Charles D. Bailey, III, Esquire
Bowman, George, Scheb, Toale and Robinson
22 South Tuttle Avenue, Suite 3 Sarasota, Florida 34237
Andrew H. Cohen, Esquire
Hankin, Perrson, Davis & Darnell 2033 Main Street, Suite 400
Sarasota, Florida 34237
Charles J. Brantley, Director Department of Highway Safety and
Motor Vehicles
Neil Kirkman Building 2900 Apalachee Parkway
Tallahassee, Florida 32399-0500
Michael J. Alderman, Esquire Department of Highway Safety and
Motor Vehicles
Neil Kirkman Building, Room A432 2900 Apalachee Parkway
Tallahassee, Florida 32399-0500
NOTICE OF RIGHT TO SUBMIT EXCEPTIONS
All parties have the right to submit written exceptions within 15 days from the date of this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the final order in this case.
| Issue Date | Proceedings |
|---|---|
| Jun. 05, 2000 | Final Order filed. |
| May 08, 2000 | Recommended Order sent out. CASE CLOSED. Hearing held 12/13-14/99. |
| Feb. 18, 2000 | (Disk) (Granny`s Motorsports Proposed Recommended Order) filed. |
| Feb. 15, 2000 | Disk (Kawasaki Proposed Recommended Order) filed. |
| Feb. 14, 2000 | Kawasaki Motor Corp., USA`s Proposed Recommended Order (for Judge Signature) filed. |
| Feb. 11, 2000 | Respondent, Granny` s Motorsports` Proposed Recommended Order (filed via facsimile). |
| Jan. 24, 2000 | (2 Volumes) Transcript of Proceedings filed. |
| Dec. 22, 1999 | (A. Cohen) Exhibits filed. |
| Dec. 13, 1999 | CASE STATUS: Hearing Held. |
| Dec. 09, 1999 | Amended Exhibit List (Amendments in Italics) (filed via facsimile). |
| Dec. 03, 1999 | Prehearing Stipulation (filed via facsimile). |
| Nov. 22, 1999 | (A. Cohen) Notice of Taking Deposition (filed via facsimile). |
| Nov. 17, 1999 | Order Adopting Stipulated Protective Order sent out. |
| Nov. 17, 1999 | Amended Notice of Hearing sent out. (hearing set for December 13 through 15, 1999; 10:00 a.m.; Sarasota, FL) |
| Nov. 02, 1999 | Order Granting Continuance and Re-scheduling Hearing sent out. (hearing set for December 13 through 15, 1999; 10:00 a.m.; Sarasota, FL) |
| Oct. 27, 1999 | Letter to Judge Holifield from Dean Bunch (Protective Order) (filed via facsimile). |
| Oct. 15, 1999 | Letter to Judge Holifield from Kelly O`Keefe (Hearing Dates) (filed via facsimile). |
| Oct. 12, 1999 | Letter to Judge Holifield from Andrew Cohen (confirmation of the trial date 12/13-15/99) (filed via facsimile). |
| Oct. 11, 1999 | Respondent`s Amended Response to Petitioner, Kawasaki Motors Corporation USA`s, First Request for Production of Documents (filed via facsimile). |
| Oct. 11, 1999 | (A. Cohen) Notice of Telephonic Hearing (10/12/99; 10:30 a.m.) (filed via facsimile). |
| Oct. 08, 1999 | Letter to Judge Holifield from K. O`Keefe Re: Telephonic hearing (filed via facsimile). |
| Oct. 06, 1999 | (K. O`Keefe) Response to Motion for Continuance (filed via facsimile). |
| Oct. 05, 1999 | (Respondent) Motion for Continuance (filed via facsimile). |
| Oct. 01, 1999 | Respondent Granny`s Motorsports Notice of Intent to Rely on Summaries; Notice of Serving Supplemental Answers to Interrogatories filed. |
| Sep. 30, 1999 | Respondent`s Response to Petitioner, Kawasaki Motors Corporation USA`s, First Request for Production of Documents; Notice of Serving Answers to Interrogatories filed. |
| Sep. 20, 1999 | Petitioner Kawasaki Motors Corporation U.S.A.`s Notice of Intent to Rely on Summaries (filed via facsimile). |
| Sep. 16, 1999 | Respondent Granny`s Motorsports` Second Amended Notice of Taking Depositions filed. |
| Sep. 16, 1999 | Petitioner Kawasaki Motors Corporation U.S.A.`s Notice of Intent to Reply on Summaries (filed via facsimile). |
| Sep. 13, 1999 | Respondent Granny`s Motorsports` Notice of Taking Depositions filed. |
| Sep. 08, 1999 | Order Denying Motion for Protective Order sent out. |
| Sep. 07, 1999 | (J. Toale) Notice of Serving Answers to Interrogatories filed. |
| Sep. 02, 1999 | (A. Cohen) Notice of Telephonic Hearing (9/3/99; 9:30 a.m.) (filed via facsimile). |
| Sep. 01, 1999 | (Respondent) Response to Petitioner, Kawasaki Motors Corporation USA`s Motion for Protective Order (filed via facsimile). |
| Sep. 01, 1999 | Petitioner Kawasaki Motors Corporation U.S.A.`s Motion for Protective Order (filed via facsimile). |
| Aug. 30, 1999 | Respondent Granny`s Motorsports` Notice of Taking Depositions filed. |
| Aug. 20, 1999 | Petitioner, Kawasaki Motors Corporation, U.S.A.`s Responses to Respondent`s First Request for Production of Documents (filed via facsimile). |
| Aug. 20, 1999 | Petitioner, Kawasaki Motors Corporation, U.S.A.`s Answers to Respondent`s First Set of Interrogatories (filed via facsimile). |
| Aug. 20, 1999 | Kawasaki Motors Corporation, U.S.A.`s Notice of Service of Answers to Granny`s Motorsports` First Set of Interrogatories (filed via facsimile). |
| Aug. 19, 1999 | (C. Bailey) Notice of Appearance; Petitioner, Action Jet Sports, Inc.`s Response to Respondent`s Request to Produce (filed via facsimile). |
| Aug. 19, 1999 | (K. O`Keefe, A. Cohen, J. Toale) Stipulated Protective Order (for Judge Signature) (filed via facsimile). |
| Aug. 09, 1999 | Respondent Granny`s Motorsports Notice of Taking Deposition filed. |
| Aug. 09, 1999 | Respondent Granny`s Motorsports Notice of Cancellation of Deposition filed. |
| Jul. 30, 1999 | Respondent Granny`s Motorsports Notice of Taking Deposition w/cover letter filed. |
| Jul. 19, 1999 | Notice of Service of Respondent`s First Set of Interrogatories to Petitioner, Action Jet Sports, Inc. filed. |
| Jul. 19, 1999 | Notice of Service of Respondent`s First Set of Interrogatories to Petitioner, Kawasaki Motors Corporation U.S. A. filed. |
| Jul. 12, 1999 | Order Granting Continuance and Re-scheduling Hearing sent out. (hearing set for October 27-28, 1999; 10:30am; Sarasota) |
| Jul. 07, 1999 | Agreed Motion for Continuance (filed via facsimile). |
| May 26, 1999 | Order of Pre-hearing Instructions sent out. |
| May 26, 1999 | Notice of Hearing sent out. (hearing set for August 24, 1999; 10:30 a.m.; Sarasota, FL) |
| May 06, 1999 | Letter to Judge Holifield from A. Cohen Re: Hearing dates filed. |
| May 03, 1999 | Response to Initial Order (filed via facsimile). |
| Apr. 22, 1999 | Initial Order issued. |
| Apr. 21, 1999 | (D. Bunch) Notice of Appearance (filed via facsimile). |
| Apr. 15, 1999 | Agency Referral Letter; Intent to Establish Kawasaki Franchise Dealership in Bradenton (letter) filed. |
| Aug. 23, 1998 | Amended Notice of Hearing sent out. (hearing set for October 27 and 28, 1999; 10:30 a.m.; Sarasota, FL) |
| Issue Date | Document | Summary |
|---|---|---|
| Jun. 02, 2000 | Agency Final Order | |
| May 08, 2000 | Recommended Order | The existing Kawasaki dealer is providing inadequate representation to the Bradenton/Sarasota community. It is recommended that Kawasaki be allowed to establish additional dealerships in the Bradenton/Sarasota community. |
