STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FUN BY LAND AND SEA, INC., and ) KAWASAKI MOTORS CORPORATION, ) U.S.A., )

)

Petitioners, )

)

vs. )

) DAYTONA FUN MACHINES, INC., )

)

Respondent. )

Case No. 00-3501

)

RECOMMENDED ORDER

Upon due notice, this cause came on for a disputed-fact hearing on February 14-16, and February 20-21, 2001, in Deland, Florida, before the Division of Administrative Hearings, by its duly-designated Administrative Law Judge, Ella Jane P. Davis.

APPEARANCES

For Petitioner Fun By Land and Sea, Inc.

Jeffrey R. Bankston, Esquire Buschman, Ahern, Persons & Bankston 2215 South Third Street, Suite 101

Jacksonville, Florida 32250

For Petitioner Kawasaki Motors Corporation, U.S.A. Dean Bunch, Esquire

Russell Kent, Esquire Sutherland, Asbil & Brennan, LLP 2282 Killearn Center Boulevard Tallahassee, Florida 32308-3561

For Respondent Daytona Fun Machines, Inc.

R. Matthew Miles, Jr., Esquire Norman Waara, Esquire

R. Matthew Miles, Jr. & Associates

433 Silver Beach Avenue, Suite 201 Daytona Beach, Florida 32118

STATEMENT OF THE ISSUE

Whether Kawasaki Motors Corporation, U.S.A. (KMC) should be permitted to establish an additional franchised dealership for the sale of Kawasaki motorcycles, as Fun By Land and Sea, Inc. (FBLS), to be located at 3566 U.S. 92, Daytona Beach, Volusia County, Florida, pursuant to the standards established in Chapter 320, Florida Statutes.

PRELIMINARY STATEMENT

Daytona Fun Machines, Inc. (DFM), an existing Kawasaki dealer, timely protested KMC's application to establish FBLS as an additional franchised Kawasaki motorcycle dealer. The cause was referred to the Division of Administrative Hearings on or about August 22, 2000.

On the record, before the presentation of evidence, the style of this cause was amended, as set out above, to reflect the duty to go forward and burden of proof herein.

Petitioners KMC and FBLS presented the oral testimony of Patricia Murphy, Thomas W. Longo, James Capps, Kenneth Couterier, and Jeffrey Bankston. KMC's/FBLS's Exhibits 1-4 were admitted in evidence.

Respondent DFM presented the oral testimony of Conrad Thron, Chris Gray, Christine Gray, David Epstein, Richard Prioletti, Ben L. Dyer, Thomas L. Brooks, James Walker, and Dr. Paul M. Mason. DFM Exhibits 3-8, 10, 12, and 14 were admitted in evidence. DFM Exhibits 2 and 9 were offered but not admitted.

DFM Exhibits 1, 11, and 13 were withdrawn, and DFM-15 was not offered.

A Transcript (1301 pages) was filed on April 5, 2001. All Proposed Findings of Fact and Conclusions of Law have been considered in preparation of this Recommended Order.

FINDINGS OF FACT

1. Petitioner KMC is a licensed distributor of motor vehicles, to wit: Kawasaki motorcycles, and is authorized to sell to its dealers in Florida.

2. Petitioner FBLS is an applicant for a Kawasaki dealership to be located at 3566 U.S. 92, Daytona Beach, Florida. Its principal is Jeffrey R. Bankston.

3. FBLS proposes to be a multi-line dealership, carrying Ducati motorcycles, Aprilia motorcycles and scooters, assorted all terrain vehicles (ATVs) and other assorted accessories and merchandise in addition to Kawasaki products.

4. Respondent DFM, the existing Kawasaki motorcycle dealer in Daytona Beach, Florida, is located at 480 Ridgewood Avenue,

   Holly Hill, Florida, which is 8.3 miles, by straight-line distance, and 12.5 ground miles from the proposed FBLS location. Its principal is Chris Gray.

5. DFM also is a multi-line dealership, selling the following brands and products in addition to Kawasaki motorcycles: Honda, Yamaha, and Victory motorcycles, assorted ATVs, and personal watercraft and jet boats made by Sea Doo, Yamaha, and Kawasaki, and accessories and apparel of the named manufacturers.

6. DFM has standing to protest, and timely protested, the proposed establishment of FBLS as a Kawasaki dealership, pursuant to Section 320.642(3), Florida Statutes.

7. This proceeding is governed by Section 320.642, Florida Statutes, which sets forth the conditions for establishment of an additional dealership. Pursuant thereto, KMC may establish a new dealership if the existing franchised dealer, DFM, is not providing adequate representation of Kawasaki motorcycles in the subject community or territory.

8. While the statute lists eleven factors which may be considered in making the determination that adequate representation is not being provided, the statute does not define "community," "territory," or "adequate representation." Information for the eleven factors overlaps in many ways.

   Therefore, except as noted hereafter, the eleven factors will be discussed together.

9. For purposes of the instant proceeding, factor five, (coercion of a dealer by a manufacturer not to file a protest) is not an issue. See Finding of Fact 6.

10. According to every standard KMC regularly uses, DFM was not meeting KMC's sales expectations at the time (1999-2000) KMC was deciding to add FBLS as a dealership. KMC does not consider DFM a "bad dealership," just one that is located in a market area that is too big for one dealer to effectively promote its product.

11. The proposed new sales point for FBLS, commonly called an "add-point location," is located in Volusia County, Florida, which has more than 300,000 population, according to the most recent estimate of the University of Florida Bureau of Economic and Business Research.

    Statistical Information

    
    

12. Due to DFM's protest, KMC re-analyzed the area served and the adequacy of DFM's representation by employing Mr. Thomas

    W. Longo. Mr. Longo holds a B.S. in system science engineering and an M.B.A. He has approximately fourteen years of hands-on experience with retail network analysis and network analysis of motor vehicle sales statistics. Mr. Longo was accepted as an expert in dealer network analysis.1

13. For his analysis, called an "Open Point Study,"

    
    

    Mr. Longo relied on consumer behavior data commonly utilized in defining a "community or territory" (Comm/Terr), provided by the Motorcycle Industry Council (MIC), and demographic data from Claritas, which demographic data also is commonly used in the motor vehicle industry.

14. The motor vehicle industry is unique in gathering data for all vehicles which are sold in the United States. This data permits examination of what consumers actually have done, as opposed to projecting what they may do in the future based upon a sample of less specific data.

15. The consumer data used for Mr. Longo's analysis was provided by MIC, which collects the sales information from the major motorcycle manufacturers, assembles the data, and provides it back to the contributing manufacturers. This information includes certain attributes about the sale: when it was made, what type of motorcycle was purchased, and where the customer resides.

16. MIC collects data on street-legal, on-road motorcycles, off-road motorcycles, ATVs, motor scooters, and dual-purpose motorcycles, which may be licensed and used on-road but which are often used for off-road purposes.

17. Although MIC data contains information for all motorcycle products, only on-road motorcycles and dual-purpose

    motorcycle sales may be used for purposes of establishing adequacy of representation under Section 320.642, Florida Statutes. Mr. Longo's study used only such permissible data, which he then "broke-down" and cross-referenced in a variety of ways.

18. A Metropolitan Statistical Area (MSA) constitutes an identifiable market area.

19. A primary market area (PMA) represents the area, or identifiable plot, in which an existing dealer has, or a proposed dealer should have, a competitive advantage over same line-make dealers by virtue of the resident dealer's location.

20. Within his overall assessment, Mr. Longo takes known and recorded motorcycle industry purchase behavior data and looks at it spatially. Part of the purpose of relying on actual purchase behavior patterns rather than making projections based on mean or median "demographics," such as population (numbers and age), income, employment, etc. factors, is to avoid marketing only to the mean or median of each demographic instead of marketing to all consumers on a geographic basis.

21. Marketing to all consumers on a geographic basis is common in the motor vehicle industry and recognized by the case law developed under the controlling statute. Moreover, marketing of motor vehicles does not equate with most portable retail sales which are often marketed in single large multi-

    retailer locations such as malls, and for which buyer residence tracking is limited or impossible.

22. In determining Comm/Terrs, PMAs, and markets generally, it is appropriate to consider the area assigned to the protesting dealer by KMC in its dealership franchise agreement, but consideration is not limited to that assigned area.

23. Mr. Longo assigned each Kawasaki dealer, including Respondent DFM, a PMA with a radius of five miles around its dealership. This is the area typically indicated in the dealership franchise agreement. However, Mr. Longo considered this distance to be too small to constitute a reasonable area for analysis of market penetration. For instance, a five-mile radius would be even less than the distance provided by law for an existing dealer to qualify as a protestant against a proposed add-point dealer.

24. Initially, each existing and proposed dealer in the area of the proposed add-point dealer plus the fringe, or surrounding area, was assigned the census tracts, as determined by the federal government after the most recent ten-year census, which are closest to that dealer or to the dealer who made the plurality of sales in the tract.

25. All census tracts were assigned by distance, except for a few tracts in the Deltona area of Volusia County which

    were assigned to the dealer in Longwood, Seminole County, because the highly accurate past-sales information clearly showed that dealer had made the plurality of sales in those tracts. The area was then narrowed further.

26. "In-sell" is a sale into one market by a dealer outside of that market.

27. Nine Kawasaki dealers in St. Johns, Marion, Lake, Orange, Osceola, and Brevard Counties occupy the area surrounding the Volusia and Flagler County area. Consumer behavior data referred-to as "cross-sell" data, indicated that very few of the Kawasaki sales by these nine dealers were made to customers residing in Volusia and Flagler Counties. The vast majority of the sales into this area were made by protestant- Respondent, DFM. On this basis, all areas in the fringe surrounding Volusia and Flagler Counties were excluded from the Daytona Comm/Terr as defined by Mr. Longo.

28. The Daytona Comm/Terr was defined as most of Volusia County (absent a few census tracts near Deltona) and Flagler County. At the present time, without any other Kawasaki dealer being located therein, DFM has a geographic sales advantage in the Daytona Comm/Terr.

29. In a similar way, Mr. Longo used the assignment of census tracts within the Daytona Comm/Terr which are generally closest to DFM, and those generally closest to the add-point

    proposed for FBLS, together with consideration of the road network, to construct the PMAs.

30. The "Daytona PMA" is the area in which DFM is located and in which it has a geographic advantage, and will continue to have that advantage, even if FBLS is permitted to open in the proposed location (add-point), which is the focus of this case.

31. The "West Volusia PMA" is the area in which the proposed FBLS dealership would have a geographical advantage, if established.

32. KMC, through Mr. Longo, defined the Jacksonville MSA as comprising four counties: Clay, Duval, Nassau, and St. Johns.

33. KMC, through Mr. Longo, defined the Daytona MSA as comprising Volusia and Flagler Counties.

34. Dr. Paul Mason, Ph.D., was accepted as Respondent DFM's expert in micro- and macro-economic analysis, research design, and statistical analysis of economic conditions and factors. He has never done any studies directly related to motor vehicle sales or utilized MIC data. He testified that Mr. Longo's Open Point Study and Mr. Longo's conclusions therefrom do not meet market sampling standards for projecting future sales, including but not limited to the absence of a statistical analysis of comparative market share data such as median, standard deviation, or range of distribution; the absence of a served market analysis; the absence of an averaging of

    adequately served markets; the absence of a segment preference analysis by dealer, county, market area, or state; the absence of separate age, income, and employment analyses; the absence of a chi-square analysis; the absence of a brand preferences analysis; problems with small sample bias; and the absence of a regression analysis, as those terms and functions are normally utilized for projection of future sales of other retail goods and services. However, Dr. Mason did not perform the computations he recommended, and his arguments that the necessary information was not implicit or "baked-into" the motor vehicle sales data was not persuasive.

35. Respondent DFM challenged the data utilized by KMC's expert, Mr. Longo, and the methodology by which he applied that data to reach a conclusion that the Daytona Comm/Terr and Daytona PMA is inadequately represented. DFM also took issue with using the Jacksonville MSA for comparison with the Daytona Comm/Terr and Daytona and West Volusia PMAs. However, the boundaries arrived-at by Mr. Longo for each of these areas were not disputed, and no alternative Comm/Terrs, PMAs, or MSAs were offered by Respondent.2

36. Therefore, KMC's uncontroverted definitions of the Comm/Terrs, MSAs, and PMAs are utilized throughout this Recommended Order.

37. Mr. Longo selected the Jacksonville MSA as a local market area which is adequately represented. Selecting a local market area establishes a "benchmark" for "adequacy of representation" against which the Daytona Comm/Terr and DFM's Daytona PMA can be assessed for adequacy of representation.

38. Respondent attacked Mr. Longo's underlying data and methodology of selecting the Jacksonville Comm/Terr and MSA as deficient or misleading for purposes of assessing inadequacy of DFM's representation of KMC, on the same theories (see above) as it attacked his ultimate conclusions based upon his Open Point Study (analysis). However, despite Respondent DFM's cross- examination of Mr. Longo, independent evidence, and expert's opinion,3 it is found that the Jacksonville MSA is a viable benchmark for measuring adequacy of representation in this cause because the Jacksonville MSA is separate, local, adjacent, and does not overlap the Daytona Comm/Terr; it is not the highest- or lowest-served area; and it was tested against the state as a whole and against the nation as a whole, with adjustments for areas where there are no Kawasaki dealers at all; it is based on actual Kawasaki dealers' performance, adjusted for segment sales and popularity by calendar year to account for Kawasaki's model- mix change over time4; and insofar as possible, it removed from consideration those differences for which the dealer(s) or manufacturer cannot be held accountable. Finally, the

    Jacksonville MSA is a reasonably stable market for Kawasakis, based on the length of time the Kawasaki dealers there have been in operation, and in the Jacksonville MSA, Kawasaki has parity with three dealerships to three dealerships of Honda, Yamaha, Suzuki, and Harley-Davidson.

39. In so finding, Respondent's expert's testimony has not been ignored. However, despite Dr. Mason's concerns, it appears that Mr. Longo's segmentation process took into account all of the necessary statutory components. Rather than looking at demographics and buyer profiles and comparing average customers to the rates at which motorcycles are purchased, segmentation is based on what those customers actually purchased. Therefore, the motorcycle sales data utilized by Mr. Longo implicitly includes ("bakes-in") those demographic components which

    Dr. Mason perceived as missing or unaccounted-for, even if Mr. Longo used a methodology different from that preferred by Dr. Mason.

40. "Market share" represents the sales of a manufacturer, such as KMC, in proportion to the business available in a particular market.

41. By measuring Kawasaki's penetration in each segment achieved in the Jacksonville MSA compared to the industry available in each segment in the Daytona Comm/Terr, an

    appropriate standard was established by Mr. Longo for the market share penetration KMC should reasonably expect in the Daytona Comm/Terr if KMC were receiving adequate representation.

42. The Jacksonville MSA market share exceeds the Florida average market share for Kawasaki. Comparing either market share is acceptable under the statutory scheme and case law, but the Jacksonville MSA is a more accurate standard in this case than the Florida average for the reasons already set out and because the Florida average is composed of Kawasaki's performance in areas with adequate, inadequate, and no representation.

43. By comparison, many areas of the Daytona Comm/Terr plus the fringe area are exceeding the Jacksonville MSA, and DFM has been increasing its share, with fluctuations, for three years, but the Daytona Comm/Terr as a whole is still only 66.7 percent of the Jacksonville market, or about two-thirds of what KMC should expect. DFM's performance is not adequate by the Jacksonville MSA standard in the Daytona Comm/Terr or in either DFM's Daytona PMA or in the West Volusia PMA, assigned to FBLS.

44. Examination of the performance of Kawasaki as a brand in the Daytona Comm/Terr, utilizing the segmentation analysis, reveals that the efforts of all Kawasaki dealers selling into this area have failed to achieve a reasonably expected market

    penetration consistently during the period 1997 through the first eight months of 2000. Comparing the performance of Kawasaki in the Daytona Comm/Terr or DFM's Daytona PMA to either the Jacksonville MSA or the more conservative Florida average shows that Kawasaki has not achieved a reasonably expected market penetration.

45. By either measure, the Daytona Comm/Terr's performance ranged between 50 percent of expected and 66.7 percent of expected, and much of this performance can be attributed to in- sell by other dealers outside the Daytona Comm/Terr.

46. Similar patterns emerge when Kawasaki's penetration in the Daytona PMA and the West Volusia PMA is compared with expected penetration based on the Jacksonville MSA and Florida standards.

47. Kawasaki's performance compared to the reasonably expected market share in the West Volusia PMA has remained consistently substantially below both the Florida and Jacksonville MSA standards for the period between 1997 and the first eight months of 2000. Oddly enough, Kawasaki's market penetration in the West Volusia PMA is slightly higher than it is in the Daytona PMA, where DFM is located.

48. It is clear that DFM, the only dealer in the Daytona Comm/Terr, has not adequately represented Kawasaki even in its

    own PMA, but it is less clear why Kawasaki is doing better in the West Volusia PMA. The probable reason is in-sell.5

49. In defining the Comm/Terrs, MSAs, and PMAs, Mr. Longo considered actual past sales performance as controlled by the number of dealers, location of each dealer, and operation of each dealership, the three elements he perceives as elements of "the dealer network." A problem with the dealer network is the likeliest cause of inadequate representation. For example, the problem could be caused by an inadequate number of dealers, the manner in which the existing dealerships are being operated, or the location of the dealerships. The economic and marketing conditions in the area were reviewed to determine the most likely cause.

50. There is a significant density of population in the area of the proposed FBLS dealership in West Volusia, which presently has no Kawasaki dealership which has demonstrated an ability to serve it.

51. The whole Daytona Comm/Terr, as well as both PMAs, has experienced a significant household growth since 1980. These trends are predicted to continue through 2005. Industry experience has indicated that there is a sales component for motorcycles associated with household units.

52. Demographic factors also indicate both the Daytona and West Volusia PMAs are each 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 around $50,000.

53. Average annual employment in Volusia and Flagler Counties has grown by approximately 19,000 jobs between 1990 and 2000, indicating a generally healthy economy, and confirming the growth in the area.

54. The current and future demographic factors indicate that the addition of a dealer is justified in terms of the economic factors and also indicate that inadequacy of representation is not due to demographic or other factors unrelated to the dealer network.

55. In terms of 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 available since 1996. This increase is present in both the Daytona PMA and the West Volusia PMA. The total motorcycle industry sales within the Daytona Comm/Terr have doubled from 1997 through August 2000, from 683 to 1,368.

56. During this same period, DFM's sales into the Daytona Comm/Terr have increased from 43 to 69, an increase of

    60 percent, while sales of other Kawasaki dealers to customers in the area have increased 300 percent, from 14 to 57.

57. Respondent's suggestions that the stable and influx populations of the Daytona Comm/Terr are aging faster than the population of the Jacksonville MSA and that the Daytona market's increased employment statistics are somehow shaded by most new jobs being in the low-paying tourist industry as opposed to in industries paying over $50,000 per year involve comparing apples and oranges as applied to actual motorcycle sales made predicting potential sales to be made. In light of the growth in the total available motorcycle market in the Daytona Comm/Terr, measured by total industry sales, coupled with the demographic and employment characteristics, DFM's low market- share inadequacy is not due to local demographic or economic factors or lack of growth in the motorcycle industry, but is most likely due to DFM's inability to keep pace with the growth in its market.

58. According to Mr. Longo's explanation, by examining the curve between zero and 100 percent of the marketing effort, the appropriate number of outlets in a market can be determined.

59. For example, in the Daytona Comm/Terr, where Kawasaki is now solely served by DFM, Kawasaki has 10 percent of the franchises, whereas in the Jacksonville MSA, Kawasaki has

    16.7 percent of the franchises. Kawasaki would be required to have two dealerships in order to have the same share of the franchises in the Daytona Comm/Terr that it has in the

    Jacksonville MSA. Therefore, in addition to DFM, the sole Kawasaki dealership present in the Daytona Comm/Terr at this time, a fraction of one more Kawasaki dealer is statistically necessary if Kawasaki's reasonably expected market share is to be reached in the Daytona Comm/Terr.

60. The inadequate representation for Kawasaki in the Daytona Comm/Terr is not caused by population shifts or other demographic or income factors. Indeed, the Daytona MSA (Volusia and Flagler counties) population has grown at approximately the same rate as the Jacksonville MSA from 1990-1999, and has a higher predicted growth rate between 2000 and 2020.

61. It is not unreasonable, based on the significant growth factors reviewed, to "round up" that need to add one more "real life" dealer at this time. Respondent's argument that one dealer should not be added because only "one-half" (actually seven-tenths) of an additional dealer has been statistically demonstrated as currently needed, based on figures now nearly one year old6, is rejected as unreasonable.

62. The addition of one Kawasaki dealer would bring the Daytona Comm/Terr in line with other Florida markets in terms of available sales opportunities per dealer. See Findings of Fact

    38 and 84.

    
    

63. In the Daytona Comm/Terr, there are eleven competing motorcycle franchises. Yamaha and Honda have two each.

    Kawasaki has only one, DFM. DFM sells Kawasaki, Honda, and Yamaha motorcycles. FBLS' proposed location will be at a greater distance from DFM than the distance between the two existing Yamaha dealers and between the two existing Honda dealers, respectively. The addition of one Kawasaki dealer would bring KMC in parity with those manufacturers' presence in the Daytona Comm/Terr.

64. The establishment of FBLS as an additional Kawasaki dealer is justified at this time based on the size of the market, measured in comparison to the Jacksonville MSA and the number of Kawasaki dealers and competitors there, and based on the comparative insufficiency of intra-brand competition (competition with other Kawasaki dealers) in the Daytona Comm/Terr. Inter-brand competition (competition with other brands) in the Daytona Comm/Terr also compares unfavorably with the Jacksonville MSA.

65. The addition of a dealer in the Daytona Comm/Terr would increase convenience for Kawasaki customers in that area.

66. The proposed location of FBLS in the West Volusia PMA is an area which is centrally located between the two major population centers in the Daytona Comm/Terr. It is very near the confluence of the major high speed thoroughfares in Volusia County, namely Interstate 95, Interstate 4, and U.S. 92.

67. Mr. Ben L. Dyer, the Volusia County official in charge of the county's comprehensive plan, reported that a new highway was planned to intersect at U.S. 92 near the proposed dealership and run north to Flagler County, where a large Development of Regional Impact (DRI) also is planned.

68. From a geographical standpoint, the Daytona Comm/Terr is large, approximately 60 miles from north to south. Even so, the driving distance between DFM and the proposed FBLS location is 15 and 18 minutes, compared to the 10-minute drive required to drive from one Honda dealership to the other and from one Yamaha dealership to the other in Daytona Beach. Locating FBLS as proposed would provide greater convenience to consumers, bring Kawasaki into greater parity with other manufacturers selling in the area, and still, presumably, have less impact on DFM than additions of new dealerships had to existing dealerships of other line-makes.

69. The proposed add-point location will increase customer convenience by minimizing the distance which motorcycle buyers must travel to get to the nearest Kawasaki dealership.

70. Respondent DFM offered no alternative proposed location for an additional dealership, but contended that KMC proposed to establish FBLS in the wrong place. DFM's contention appears to be that the add-point location is too far east of expected growth centers, particularly Deland and western and

    southwestern fringe areas of the Daytona Comm/Terr, to draw a supporting population of Kawasaki buyers. To this end, it was shown that there is a relatively low population in most of the two mile incremental, concentric circles (not census tracts) surrounding FBLS, due to conservation areas, dedicated lands, and burned-out areas.

71. However, based on the evidence as a whole, it appears that although FBLS' proposed location on U.S. 92 (International Speedway Boulevard) is at the edge of current growth in the east Volusia/Daytona Beach area, growth of commercial development in Volusia County is generally towards the west. Further, although lands in the central part of the county have been set aside for conservation and other purposes and may not be developed, and although some of the area is set aside for only one residential dwelling per acre, the proposed FBLS location is very near the confluence of the three major highways which traverse Volusia County, namely, Interstate 95, Interstate 94, and U.S. 92.

72. Therefore, the proposed location offers excellent accessibility to all areas of the Daytona Comm/Terr, including all areas of Volusia and Flagler counties.

73. In addition, Mr. Richard Prioletti, the Daytona Beach planning administrator, testified that commercial growth was generally to the west, with the City of Daytona Beach being primarily "built out" and not available for additional

    development. Mr. Prioletti also confirmed that a Ford motor vehicle dealership and a Chevrolet motor vehicle dealership were relocating from downtown Daytona Beach to the intersection of Interstate 95 and LPGA Boulevard.7 Therefore, the fact that there may not be current substantial population within a short distance of FBLS' proposed add-point location does not eliminate it as an appropriate location, because it is appropriately located to serve all areas of the Daytona Beach Comm/Terr; appropriately located to capture in-sell now going out of the area to other dealers; and its business location is not contrary to the population and other similar business movements in the area.

74. Respondent DFM did not give a clear estimate of the amount of lost business it would sustain as a result of the add- point dealership, either in terms of numbers of sales or financial impact, but its contention and its lay and expert witness testimony is that due to Mr. Gray's competitive nature and the allegedly unrealistic sales projections of Mr. Bankston on behalf of FBLS, a price war will ensue if FBLS is allowed to enter the Daytona Comm/Terr; that the price war will hurt DFM's business; and that the price war will drive FBLS and/or DFM out of business entirely, thereby unfavorably impacting consumers as well as the two dealers.

75. The dealer franchise agreement between DFM and KMC specifies that the dealer is an independent businessperson and it is within the dealer's sole discretion as to how to operate its dealership. The same language will apply to FBLS if KMC is permitted to establish it. KMC is not obligated to, and has no way to, ensure either dealer's success or to prevent a price war if Mr. Gray and Mr. Bankston launch one.

76. The only quantifiable evidence of an ensuing price war offered by DFM is that it currently has a 15 percent profit margin on the type of Kawasaki motorcycles cognizable by this statute, but would have to accept a margin of four to five percent to capture customers it is currently losing to in-sell dealers. Mr. Gray inferred thereby that he would have to make the same or a better deal to Kawasaki customers targeted by the proposed new dealership, based on FBLS's application information. His inference is not exactly a "price war," as commonly understood, and in terms of the impact that a new dealer may have on DFM, it is not highly significant, since DFM is willing to cut its profit margin to five percent now in order to capture in-sell. See Findings of Fact 89 and 92.

77. Assuming, arguendo, that a price war ensues, customers

    
    

    would at least have a short-term cost benefit and no long term disadvantage if only one dealer does not make the competitive cut. However, for the following reasons, it is probable that

    the increased competition would not damage either DFM or the potential FBLS.

78. Mr. Longo's estimate of sales of the proposed dealership, which is based on total industry motorcycle sales availability, rather than population, and based on 1999 data, shows FBLS as potentially selling 42 Kawasaki on-road and dual- purpose motorcycles in 1999 within 20 miles from the proposed add-point location.

79. Mr. Bankston's application to KMC in 2000, estimated that FBLS would sell 150 new units from the proposed location. However, his estimate included 30 sales of Ducati motorcycles and 40 sales of Aprilia motorcycles and scooters, leaving 80 estimated Kawasaki sales. Mr. Bankston's estimate of 80 Kawasaki units included both on-road and off-road units and also included his estimate of the total sales of Kawasaki products he was going to make, not limited to those customers residing within 20 miles of FBLS's proposed location.

80. Therefore, contrary to DFM's contention, it is found that Mr. Longo's year 1999 sales-estimate of 42 Kawasaki units cognizable by this statute to be sold within a 20-mile radius is not inconsistent with FBLS's 2000 sales-estimate of a total 80 Kawasaki units of all kinds to be sold to any location as set out in its dealer application. See Findings of Fact 3, 5, and 17.

81. Gross sales loss takes into account only those census tracts which do not perform up to the expected potential for Kawasaki. Gross sales loss is the most appropriate manner to determine available opportunity, because it does not mask areas of loss with other areas of gain. For example, if the eastern half of a market was a certain number of units higher than expected, and the western half has the same number lower than expected, using a net sales analysis, there would appear to be no available sales opportunity for a brand. Mr. Longo's utilization of the gross sales loss concept avoids this masking.

82. The gross sales loss in the Daytona Comm/Terr, as measured by Mr. Longo in those census tracts which did not reach the reasonably expected market penetration, was 65 units for the last full year measured of 1999. These 65 units presented a sales opportunity available to DFM, as did 40 units of in-sell, or 40 Kawasaki units sold by dealers outside of the Daytona Comm/Terr to customers residing inside the Daytona Comm/Terr. Utilizing the Jacksonville MSA as a standard, there was a total lost opportunity of 105 units which has not been gathered into DFM's coffers but which still would be available for DFM to compete for against FBLS, if FBLS is established as an add- point. If FBLS performs as expected in terms of its ability to sell motorcycles at various distance rings from its proposed location, it should not unfavorably impact DFM, or any impact

    need not be significant. The level of competition forced by the personalities of the respective principals of DFM and FBLS, is not quantifiable, but with 105 available units to compete for, it looks like a fairly level playing field. Even if the in-sell figure is removed, a gross loss (potential sales opportunity) of

    65 units should provide good competition without unfair leverage by either dealer.

83. Even if the more conservative Florida average standard is utilized to generate the potential gross loss, the gross loss of 49 units, plus the in-sell of 40 units, exceeds FBLS's projected total Kawasaki sales (not just sales of on-road units).

84. At present, the Daytona Comm/Terr has 1,064 total available sales per dealer with only one dealer, DFM. Therefore, the proposed dealership will only bring the Daytona Comm/Terr in line with other markets. In terms of the availability of business for DFM and the add-point dealer to compete for, the addition of FBLS will place the Daytona Comm/Terr within the same range of available total industry sales per dealer as is currently the case in the Jacksonville MSA and other surrounding MSAs.

85. Upon the credible evidence as a whole, it is found that the establishment of FBLS will benefit consumers by stimulating better prices overall and provide a more convenient

    place to shop for Kawasaki motorcycles and more convenient Kawasaki service without damaging either DFM or FBLS. The addition of a dealership would benefit KMC in terms of additional sales of motorcycles and market share.

86. No evidence was presented that the existing DFM facility is inadequate or in any way inferior. In fact, a videotape and other evidence reveals an attractive, spacious, well-stocked location which should entice customers. See Finding of Fact 114. However, Kawasaki's market share deficiency demonstrates that something is preventing DFM from attaining an adequate market share for Kawasaki. The evidence as a whole suggests that the location is to blame.

87. DFM presented evidence concerning Mr. Gray's total investment at DFM's existing location, including but not limited to its size, staff, expenses, shelf space, product lines and taxes. This investment was not broken down in any meaningful way as to Kawasaki products or related specifically to the Kawasaki dealer franchise agreement. DFM sells many other products. See Finding of Fact 5. Nonetheless, it is a substantial investment as to shared areas and items, which may not be easily separated.

88. As to factor seven (proof that consumers would benefit by changes other than the addition of a new dealership), there was no persuasive evidence. Only Mr. Longo listed dealer-

    controllable generic methods which are known to improve market penetration8, but he listed these generally, and they were not specifically tied to what DFM could, or would, do. No nexus to "consumer benefit" was shown. It was not demonstrated that any of these generic methods were not currently being used or that increasing their use would be significant in this situation, and DFM did not commit itself to increasing any of these methods.

89. DFM did commit itself to taking affirmative action to capture in-sells, that is, to avoid the loss of sales to Kawasaki dealers outside the Daytona Comm/Terr, specifically Orlando and St. Augustine (St. Johns County), but no specific strategy was expressed except for instructing DFM staff to be willing to immediately cut DFM's profit margin from 15 percent to five percent to combat in-sell.9

90. There was no evidence that DFM desired to relocate its facility location, but Mr. Longo advised against this as a means of one dealer attempting to cover an area actually requiring two dealers for effective marketing.

91. Petitioner KMC, the manufacturer, does not suggest that DFM, the protesting dealer, has breached its dealership agreement. This eighth statutory factor cannot reasonably be read to include a breach by the manufacturer, but to the extent such a breach might have any bearing, it has been considered below under the heading, "Anecdotal Information."

    Anecdotal information

    
    

92. Mr. Gray testified that whereas his other motorcycle brands, Honda and Yamaha, attempted to restrict the availability of product, KMC had not. How this situation resulted in the lower profit margin on KMC products that he was attempting to prove was not made clear, especially in light of his asserting DFM was willing to immediately reduce its profit margin on Kawasaki motorcycles to five percent in order to capture in-sell into the Daytona Comm/Terr. See Findings of Fact 76 and 89.

93. DFM complained that it has not been able to sell Kawasaki police bikes since 1995. Various witnesses speculated that this was the result of a change in specifications by law enforcement; inferior product from the manufacturer, KMC; poor marketing of police bikes by DFM; or poor service by DFM. No proven causation emerged, and no statistic helped identify police bike marketing as a problem unique to DFM. Moreover, it is not unreasonable to expect that in the five intervening years, DFM would have revitalized its marketing share lost on police bikes.

94. Respondent presented anecdotal, as opposed to statistical, information to the effect that the Daytona Comm/Terr (and inferentially DFM's PMA) is dominated by cruiser sales and that DFM has had difficulty marketing Kawasaki cruisers because they are inferior or outdated; because KMC does

    not offer financing plans which are competitive with other motorcycle brands' financing plans; and because KMC has warranty problems. Respondent represented that these were elements DFM, as the dealer, could not control.

95. Assuming arguendo, the inferiority, if any, of

    
    

    Kawasaki's cruisers and that problems exist in marketing them, that variable would have been eliminated for statistical comparison by the Longo study, which only compared actual sales as opposed to making sales predictions based on past median behaviors. The statistical study actually shows the Jacksonville MSA as a bigger cruiser market than the Daytona Comm/Terr. Assuming arguendo, but not ruling, that product model inferiority, non-competitive financing plans, and warranty problems were somehow not "baked into" the Longo study like all other variables contained in past sales, these problems still would cut across model and dealer lines and not present marketing problems unique to DFM, its PMA, or the Daytona Comm/Terr.

96. Likewise, it is of no consequence that the Longo Study did not give particular attention to the hours of service of various Jacksonville MSA dealers, as hours of operation are at the discretion of each dealer and a component of each dealer's actual sales accomplished, which sales data Mr. Longo utilized. Also of no consequence is the presence of a U. S. Navy base near

    one of the Jacksonville dealers. Respondent's witnesses contended, based on mostly stale experience, that naval personnel often shop there (near work) providing a Jacksonville MSA sales advantage. No information was provided as to what percentage of that dealer's customers were naval personnel who lived on-base or off-base, or who even purchased Kawasaki products. Nothing was demonstrated by Respondent's anecdotal evidence concerning the Navy base to legitimately vary the industry statistical data upon which Mr. Longo relied.

97. Respondent DFM, the existing/protesting dealership is run by Chris Gray. Mr. Gray's family has been "in the business" for many years, and his wife, Christine, works in the dealership's office on a regular basis.

98. KMC's district sales manager for DFM's location is Ken Couterier. As such, he services 45 dealers. He has been district sales manager for ten years in that location. Previously, he was a KMC district sales manager in Arkansas.

99. Mr. Couterier's job is to maximize sales for KMC. KMC has found him to be an effective district manager in both locations.

100. Mr. Couterier's district does not include the Jacksonville MSA. Therefore, Mr. Couterier had no effect on Kawasaki sales in that MSA.

101. For purposes of this proceeding, DFM contends that Mr. Couterier has provided inadequate or subversive "support services" to DFM, due to the personal relationship between Mr. Couterier and Mr. Gray.

102. The personal relationship between Mr. Gray and

     
     

     Mr. Couterier began to deteriorate in approximately 1992, when Mr. Gray's wife was having trouble getting rebates on Kawasaki's jet skis (not motorcycles) from headquarters. She approached Mr. Couterier for help while he was in Mr. Gray's office one day. While what was said is in dispute, the greater weight of the credible evidence is that Mr. Couterier said to Mrs. Gray something to the effect of, "Who held a gun to your head and made you become a Kawasaki dealer?" Whereupon, Mr. Gray heatedly told Mr. Couterier, in an intimidating manner, that he was out of line. Since that time, Mr. Couterier has not visited DFM on any regular basis, and attempts by third parties to heal the rift have failed.

103. Mr. Gray eventually got his jet ski rebates, although response from the head office (not from Mr. Couterier) was admittedly slow.

104. James Capps is the KMC executive who oversees

     
     

     Mr. Couterier and approximately 600 other KMC district managers in 22 states and the District of Columbia. He made the decision to add a new dealership.

105. Mr. Capps has met with Mr. Gray and/or Mr. Gray's family members and sales manager on at least three occasions to hear their complaints concerning Mr. Couterier, which complaints involve anger over Mr. Couterier's handling of the jet ski rebate problem described in Finding of Fact 102, and their desire that Mr. Couterier call at the DFM dealership more often than he does.

106. Mr. Capps refused Mr. Gray's request to replace Mr. Couterier as KMC's district sales manager and refused to provide Mr. Gray with a written job description for Mr.

     Couterier. It was not demonstrated how these refusals impeded KMC sales by DFM, or even if they did.

107. It is not KMC's policy to require that any of its district managers visit each dealership on any regular schedule. If Mr. Couterier were to visit each of his 45 dealers on a regular rotation, he would see each one approximately every six weeks to two months, but that would not necessarily be effective management.

108. Many of KMC's district managers' functions are performed by telephone. KMC provides its district managers with two telephones, two answering machines, a fax machine, and computers so that dealers can reach their district manager at all times.

109. KMC also provides a telephone number for direct orders by dealers at all times. KMC will take any order for any vehicle at any time but will not guarantee delivery unless the order fits certain parameters. KMC "builds to order."

110. Mr. Gray never complained that Mr. Couterier or KMC refused or failed to return his phone calls.

111. Mr. Gray has never complained about motorcycle ordering problems with KMC.

112. Mr. Gray has never complained about his cooperative advertising arrangement with KMC. Every year, Mr. Gray is issued a notebook outlining how he can take advantage of that arrangement. Mr. Gray does not always use all his advertising budget provided by KMC.

113. Mr. Gray has never complained about extent or quality of KMC training pursuant to the dealership agreement.

114. Mr. Gray never complained that he had trouble obtaining motorcycles from KMC. He even asserted that at all times he kept on DFM's floor one of every model motorcycle made by KMC, in every color.

115. There was evidence that promotional events advertised by DFM were not well-coordinated by KMC and that the lack of coordination caused embarrassment to Mr. Gray and DFM.

     Mr. Gray's construction is accepted that the failure of celebrities to appear as promised by KMC made DFM "look like

     idiots," but no intentional act of KMC, Mr. Capps, or

     
     

     Mr. Couterier was demonstrated, and no nexus between these clearly egregious events and any DFM sales figures was shown to exist.

116. Mr. Gray also contended that KMC breached its contract (statutory factor eight) with him and denied his opportunity for growth and expansion (statutory factor four) by failing to evaluate and review DFM's market share and evaluate it in comparison with other dealers and by not providing assistance in promoting the sale (assistance in marketing) of KMC products, but Mr. Capps and Mr. Couterier testified credibly that KMC provided DFM market share data monthly and more market share data at least two times a year at sales meetings. They did concede that no one from KMC sat down with Mr. Gray and specifically did subtractions and comparisons using that data; that no one specifically warned Mr. Gray that DFM was below KMC's expectation of a 15 percent market share; and that no one from KMC specifically advised Mr. Gray that he was experiencing in-sell problems. Mr. Capps, at least, felt these types of assistance should have been provided by KMC to DFM. However, with the exception of the in-sell problem, the other analyses could have been done by Mr. Gray himself from the data regularly

     `provided by KMC, and he is an independent businessperson. See Finding of Fact 75.

117. Accordingly, it is found that KMC was in substantial compliance with its dealership agreement and that it was not demonstrated that anything Mr. Couterier or Mr. Capps did or did not do with regard to Respondent DFM accounted for DFM's sales not meeting KMC's expectations or a reasonably expected market share as demonstrated in the Open Point Study.

     CONCLUSIONS OF LAW

     
     

118. The Division of Administrative Hearings has jurisdiction over the parties and subject matter of this proceeding, pursuant to Section 120.57(1), Florida Statutes.

119. DFM has standing to protest as Volusia County has a population of more than 300,000 persons and DFM is within 12.5 miles of the proposed dealership. Section 320.642(3)(b)(1), Florida Statutes.

120. Since Section 320.642 does not define "community or territory," it must be determined according to the facts presented at the hearing. Anthony Abraham Chevrolet Co. v.

     Collection Chevrolet, Inc., 553 So. 2d 821, 824 (Fla. 1st DCA 1988), Larry Dimmitt Cadillac Inc. v. Seacrest Cadillac, Inc.,

     558 So. 2d 136 (Fla. 1st DCA 1990) (community or territory defined according to consumer behavioral data).

121. In determining the relevant community or territory, the area described in the manufacturer's dealings with the dealers is a material fact entitled to "great weight" but is not

     conclusive. Bill Kelley Chevrolet, Inc. v. Calvin, 308 So. 2d

     
     

     199, 201 (Fla. 2nd DCA 1974); Larry Dimmitt Cadillac, Inc. v. Seacrest Cadillac, Inc., supra.

122. Analysis of consumer behavior and cross-sell patterns demonstrate that, for Kawasaki motorcycles, Flagler and Volusia Counties are a single market and compose the Daytona Beach community or territory for the purpose of analysis under Section 320.642, Florida Statutes.

123. The manufacturer's burden of proof in showing inadequacy of representation may be fulfilled by examination of the identifiable plot where the dealership is proposed, Bill Kelley Chevrolet, Inc. v. Calvin, 322 So. 2d 50, 51-52 (Fla. 1st DCA 1975), cert. den, 333 So. 2d 1180 (Fla. 1976) or by

     examination of the territory or community as a whole. Dave Zinn Toyota, Inc. v. Department of highway Safety and Motor Vehicles, 432 So. 2d 1320, 1332 (Fla. 3rd DCA 1983).

124. Section 320.642, Florida Statutes, was not enacted "to foster combinations to prevent the introduction of dealer competition which is reasonably justified in terms of market potential." Bill Kelley Chevrolet, Inc. v. Calvin, supra.

125. Under Section 320.642(2)(b), Florida Statutes, the Department of Highway Safety and Motor Vehicles may consider evidence of the factors outlined below in assessing adequacy of representation.

126. Section 320.642(2)(b), Florida Statutes, provides:

     
     

     (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:

     
     

     1. 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.

        
        

     2. 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.

        
        

     3. 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.

        
        

     4. 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 education, 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.

        
        

     5. 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.

        
        

     6. 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.

        
        

     7. 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.

        
        

     8. Whether the protesting dealer or dealers are in substantial compliance with their dealer agreement.

        
        

     9. 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.

        
        

     10. 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.

         
         

     11. The volume of registrations and service business transacted by the exiting dealer or dealers of the same line-make in the relevant community or territory of the proposed dealership.

127. The entire thrust of DFM's case was that (1) The data commonly utilized in the industry, and utilized herein by

     Mr. Longo, does not meet market sampling standards for projecting future sales as those standards are commonly utilized by macro- and micro- economists for projection of future sales of other goods and services; and (2) The analysis done by

     Mr. Longo was therefore flawed and specious, and therefore the add-point should be denied.

128. Petitioners' claim that this approach was not sufficient and that, in order to prevail, DFM was required to present some alternative study/statistics is without merit. If DFM had established by any means that the Longo study was unreliable and specious, then, because KMC bears the duty to go forward and the burden of proof by a preponderance of the evidence, KMC would not prevail herein, and the add-point could be denied. However, herein, Mr. Longo's Open Point Study, as interpreted through his testimony, was not discredited. KMC's evidence of its reasonably expected market penetration levels and of DFM's failure to adequately represent KMC was based upon probative and reliable evidence.

129. Having weighed the statutory criteria enumerated in Section 320.642(2)(b), Florida Statutes, in light of the facts as found, it is concluded that Petitioners have met the manufacturer's burden of proving by a preponderance of the

evidence that DFM, the existing dealer, is not providing adequate representation in the Daytona Comm/Terr. A balancing of the statutory factors supports the conclusion that the benefits of establishing FBLS will outweigh the negative impact upon DFM.

RECOMMENDATION

Upon the foregoing findings of fact and conclusions of law, it is

RECOMMENDED that the Department of Highway Safety and Motor Vehicles enter its final order approving the establishment of Fun By Land and Sea, Inc., as a Kawasaki dealership at 3566

U.S. 92, Daytona Beach, Florida.

DONE AND ENTERED this 4th day of June, 2001, in Tallahassee, Leon County, Florida.

ELLA JANE P. DAVIS

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 4th day of June, 2001.

ENDNOTES

1/ Respondent did not oppose the tender or object to the acceptance of Mr. Longo as such an expert until rebuttal. (TR- 119).

2/ All MIC and Claritas data upon which Mr. Longo relied was furnished to Respondent DFM. KMC's Notice of Intent to Use Summary was filed December 27, 2000. KMC was permitted to use summaries. Respondent DFM did not offer any independent analysis utilizing the MIC and Claritas data provided by Petitioner KMC or any other data to otherwise define the Comm/Terrs, MSAs, or PMAs. DFM did not offer any alternative opinions to that of Mr. Longo based upon Mr. Longo's analysis of the MIC/Claritas data. Cf--Discussion of Dr. Mason's testimony, infra this Recommended Order and at notes 3 and 4.

3/ An example of Dr. Mason's testimony is that he, himself, had not done a chi-square but "suspected" that if he did one, the two markets would not be significantly different. He admitted that he could not say that any part of Mr. Longo's conclusions were wrong, because he had not done a study/analysis himself.

4/ Respondent correctly points out that segment preference is not expressly listed as a statutory factor for consideration of adequacy of dealer representation. However, Respondent's reasoning that Mr. Longo's study/analysis should not have created a level playing field among dealers and markets due to segment model preference does not logically follow and that it does not contribute to accuracy of the study is not a fair inference. Respondent's apparently contrary assertion that its sales are unnaturally depressed due to model flaws in some Kawasaki motorcycles (particularly cruisers) is addressed under "Anecdotal Information," infra.

5/ Mr. Longo also compared DFM's Daytona PMA for adequacy of representation against Kawasaki's state and national motorcycle sales statistics. He speculated that DFM is doing or is not doing something that causes customers to travel long distances to other dealers, thereby adding to the in-sell in DFM's Daytona PMA. However, his Open Point Study does not empirically demonstrate something DFM is, or is not, doing is the causation for this component of the mix. It does come to the overall conclusion, as related in other findings of fact, that the Daytona Comm/Terr is just too big for one dealer to adequately represent Kawasaki.

6/ The Longo Open Point Study sales data figures end in August 2000, although some standard demographic projections of future population were included.

7/ This information only indicates local business opportunities and shifts as distinguished from residential population opportunities and shifts. Pursuant to statute, planned relocation of motor vehicle dealers who do not compete in on- road motorcycles and who do not protest an add-point are irrelevant for purposes of determining adequacy of representation by the existing dealer.

8/ Mr. Longo named more advertising, more inventory, sales events, sponsor events, tent sales, operational level changes, and target marketing programs. He said customer service is key.

9/ See Findings of Fact 76, and 89.

COPIES FURNISHED:

Michael J. Alderman, Esquire Department of Highway Safety

and Motor Vehicles 2900 Apalachee Parkway

Neil Kirkman Building, Room A432 Tallahassee, Florida 32399-0500

Jeffrey R. Bankston, Esquire Buschman, Ahern, Persons & Bankston 2215 South Third Street, Suite 101

Jacksonville, Florida 32250

Dean Bunch, Esquire Russell S. Kent, Esquire

Sutherland, Asbill & Brennan, LLP 2282 Killearn Center Boulevard Tallahassee, Florida 32308-3561

R. Matthew Miles, Jr., Esquire Norman Waara, Esquire

R. Matthews Miles, Jr. & Associates

433 Silver Beach Avenue, Suite 201 Daytona Beach, Florida 32118

William T. Joyce, Director Division of Motor Vehicles Department of Highway Safety

and Motor Vehicles 2900 Apalachee Parkway

Neil Kirkman Building, Room A432 Tallahassee, Florida 32399-0500

Enoch Jon Whitney, General Counsel Department of Highway Safety

and Motor Vehicles 2900 Apalachee Parkway Neil Kirkman Building

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.

Docket for Case No: 00-003501

Orders for Case No: 00-003501