The Issue Whether the application of Peace Industry Group (Peace) and Bayside Auto Sales, Inc. (Bayside) to establish an additional franchised dealership for the sale of Astronautical Bashan motorcycles to be located at Bayside Auto Sales, 1301 Harrison Avenue, Panama City, Bay County, Florida, should be granted.
Findings Of Fact Petitioner Peace is a licensed distributor of motor vehicles in Florida and is authorized to sell motor vehicles to its dealers in Florida. Petitioner Bayside is a licensed motor vehicle dealer in Florida and is located at 1301 Harrison Avenue, Panama City, Florida. Respondent Moto is a licensed motor vehicle dealer in Florida and an existing Astronautical Bashan dealer located at 12202 Hutchison Blvd Suite 72, Panama City Beach, Florida. Currently, Moto sells the product line of Peace, including the Astronautical Bashan product line. Additionally, Moto has a franchise agreement with Peace. The agreement establishes a franchise territory with a 25-mile radius around Moto’s location. Petitioner Peace proposes to establish Bayside as a dealership for the sale of Astronautical Bashan motorcycles. The proposed dealership would be within six miles of Moto’s dealership. The two dealerships are located in Bay County and are separated by the Hathaway Bridge. Both draw customers from Bay County, with at least 20 percent of Moto’s customers located within 20 miles of Moto’s location. There was no consumer data or analysis of sales in the motorcycle industry offered into evidence. However, Moto’s franchise agreement with Peace establishes a market area of at least a 25-mile radius from Moto’s location. Bayside clearly is located within Moto’s market area. There was no evidence which demonstrated Peace’s market share in the motorcycle market. There was no evidence presented analyzing the motorcycle market in the Panama City area. Likewise, there was no evidence presented regarding anticipated growth in the market area. This type of evidence is generally presented by the distributor or manufacturer of the product. As indicated, Peace did not appear at the hearing. Given this lack of evidence, the market share for Peace or Astronautical Bashan motorcycles cannot be established. Moreover, a determination that the establishment of a second dealership in the Panama City territory is warranted must be based on the economic and marketing conditions pertinent to dealers competing in the territory. Given this lack of evidence, Petitioners failed to establish that Peace was underrepresented in the Panama City/Bay county area. Since there is no evidence to support the establishment of a second dealership, Petitioners’ application to establish such a dealership should be denied.
Recommendation 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 denying the establishment of Peace's dealership at Bayside, 1301 Harrison Avenue, Panama City, Florida. DONE AND ENTERED this 13th day of February, 2009, in Tallahassee, Leon County, Florida. S DIANE CLEAVINGER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 13th day of February, 2009. COPIES FURNISHED: Michael James Alderman, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A-432 2900 Apalachee Parkway Tallahassee, Florida 32344 Larry Bradberry Bayside Auto Sales, Inc. 1301 Harrison Avenue Panama City, Florida 32401 Wayne Wooten Moto Import Distributors, LLC 12202 Hutchison Boulevard, Suite 72 Panama City Beach, Florida 32407 Lily Ji Peace Industry Group, Inc. 6600-B Jimmy Carter Boulevard Norcross, Georgia 30071 Carl A. Ford, Director Division of Motor Vehicles Department of Highway Safety And Motor Vehicles Neil Kirkman Building, Room B-439 2900 Apalachee Parkway Tallahassee, Florida 32399-0500 Robin Lotane, General Counsel Department of Highway Safety And Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway Tallahassee, Florida 32399-0500
Conclusions This matter came on for determination by the Department upon submission of an Order Closing File by Daniel M. Kilbride, an Administrative Law Judge, of the Division of Administrative Hearings, a copy of which is attached and incorporated by reference in this order. The Department hereby adopts the Order Closing File as its Final Order in this matter. ORDERED that this case is CLOSED and no license will be issued to Sunl Group, Inc. ‘and Action Motorsports to sell motorcycles manufactured by Astronautical Bashan Motorcycle Manufacture Co. Ltd. (BASH) at 11485 South Cleveland Avenue, Suite 1, Fort Myers (Lee County), Florida 33907. DONE AND ORDERED this a — day of July, 2009, in Tallahassee, Leon County, Florida. 'ARL A. FORD, Direct6r Division of Motor Vehicles Department of Highway Safety and Motor Vehicles Neil Kirkman Building Tallahassee, Florida 32399 Filed with the Clerk of the Division otor Vehicles this ZB day of July, 2009. NOTICE OF APPEAL RIGHTS Judicial review of this order may be had pursuant to section 120.68, Florida Statutes, in the District Court of Appeal for the First District, State of Florida, or in any other district court of appeal of this state in an appellate district where a party resides. In order to initiate such review, one copy of the notice of appeal must be filed with the Department and the other copy of the notice of appeal, together with the filing fee, must be filed with the court within thirty days of the filing date of this order as set out above, pursuant to Rules of Appellate Procedure. CAF/vlg Copies furnished: Kyle Lee Ride Green, Inc. 5686 Youngquist Road #113 Fort Myers, Florida 33912 Mei Zhou Sunl Group, Inc. ~ 8551 Ester Boulevard Irving, Texas 75063 Howard Chappell, Esquire Law Offices of Howard Chappell 1514 Cumberland Court Fort Myers, Florida 33919 Michael J. Alderman, Esquire Assistant General Counsel Department of Highway Safety and Motor Vehicles ; Neil Kirkman Building, Rm. A-432 Tallahassee, Florida 32399-0504 Daniel M. Kilbride Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 Nalini Vinayak Dealer License Administrator - Florida Administrative Law Reports Post Office Box 385 Gainesville, Florida 32602 STATE OF FLORIDA DIVISION OF ADMINISTRATIVE HEARINGS SUNL GROUP, INC., AND ACTION MOTORSPORTS, Petitioners, RIDE GREEN, INC., ) ) ) ) ) vs. ) Case No. 08-5720 ) ) ) Respondent. ) )
The Issue The issue in this case is whether Petitioners' proposed motorcycle dealership would serve a community or territory in which Respondent's dealership is not presently providing adequate representation of the same line-make vehicles that Petitioners would offer.
Findings Of Fact On March 14, 2008, an advertisement was published in the Florida Administrative Weekly, which gave notice that, unless a protest were timely filed, the Department of Highway Safety and Motor Vehicles ("Department") intended to approve the application of Petitioner USA Wholesale Scooters, Inc. ("Wholesale Scooters") for a license to establish a new dealership at 2902 East Sunrise Boulevard, Fort Lauderdale, Florida (the "Proposed New Point"), where motorcycles manufactured by Petitioner Chuanl Motorcycle USA, Ltd. ("Chuanl") would be offered for sale. Respondent Power & Play Warehouse, Inc. ("Power & Play"), which is licensed to operate a dealership, under a franchise agreement, for the sale of Chuanl motorcycles in Pompano Beach, Florida (the "Existing Dealership"), timely filed a written complaint with the Department, protesting the intended approval of the Proposed New Point. The Proposed New Point and the Existing Dealership are both situated in Broward County, Florida. It is undisputed that the population of Broward County exceeds 300,000. At the final hearing, the parties stipulated that the Proposed New Point would be located within 12.5 miles of the Existing Dealership. Wholesale Scooters failed to present persuasive evidence demonstrating that the Existing Dealership is not providing adequate representation of Chuanl motorcycles in Fort Lauderdale, Pompano Beach, Broward County, or any other conceivably relevant community or territory.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order denying Wholesale Scooters' application for a license to operate a new dealership at 2902 East Sunrise Boulevard, Fort Lauderdale, Florida, where Chuanl motorcycles would be offered for sale. DONE AND ENTERED this 3rd day of September, 2008, in Tallahassee, Leon County, Florida. JOHN G. VAN LANINGHAM 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.stae.fl.us Filed with the Clerk of the Division of Administrative Hearings this 3rd day of September, 2008. COPIES FURNISHED: Noel Farbman USA Wholesale Scooters, Inc. 2902 East Sunrise Boulevard Fort Lauderdale, Florida 33304 Lingbin Chen Chuanl Motorcycle USA Co, Ltd. 9886 Chartwell Drive Dallas, Texas 75243 Thomas McMahon Power & Play Warehouse, Inc. 550 North Flagler Avenue Pompano Beach, Florida 33060 Michael J. Alderman, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A-432 2900 Apalachee Parkway Tallahassee, Florida 32399-0635 Carl A. Ford, Director Division of Motor Vehicles Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room B-439 2900 Apalachee Parkway Tallahassee, Florida 32399-0500 Robin Lotane, General Counsel Department of Highway Safety and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway Tallahassee, Florida 32399-0500
Conclusions This matter came before the Department for entry of a Final Order upon submission of an Order Closing File by June C. McKinney, Administrative Law Judge of the Division of Administrative Hearings, pursuant to Petitioner’s letter of withdrawal of protest of the establishment of AutoNation Dodge of Pembroke Pines, Inc., a copy of which is attached and incorporated by reference in this order. The Department hereby adopts the Order Closing File as its Final Order in this matter. Accordingly, it is hereby ORDERED and ADJUDGED that Respondent, AutoNation Dodge of Pembroke Pines, Inc. be granted a license for the sale and service of Jeepr passenger cars and light trucks manufactured by Chrysler (JEEP) 13601 Pines Boulevard, Pembroke Pines (Broward County), Filed January 27, 2012 3:47 PM Division of Administrative Hearings Florida 33027 upon compliance with all applicable requirements of section 320.27, Florida Statutes, and all applicable Department rules. DONE AND ORDERED this A‘! day of January, 2012, in Tallahassee, Leon County, Florida. skill, Assistant Deputy Director Division of Motorist Services Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A338 Tallahassee, Florida 32399 Filed with the Clerk of the Division of Motorist Services this | __ day of January, 2012. Nalini Vinayak, Dealer Ycense Administrator NOTICE OF APPEAL RIGHTS Judicial review of this order may be had pursuant to section 120.68, Florida Statutes, in the District Court of Appeal for the First District, State of Florida, or in any other district court of appeal of this state in an appellate district where a party resides. In order to initiate such review, one copy of the notice of appeal must be filed with the Department and the other copy of the notice of appeal, together with the filing fee, must be filed with the court within thirty days of the filing date of this order as set out above, pursuant to Rules of Appellate Procedure. MDM/jde Copies furnished: Thomas H. Yardley, Esquire Law Office of Thomas H. Yardley 1970 Michigan Avenue, Building D Cocoa, Florida 32922 Phil Langley Chrysler Motors, LLC 10300 Boggy Creek Road Orlando, Florida 32824 R. Craig Spickard, Esquire Kurkin Forehand Brandes, LLP 800 North Calhoun Street, Suite 1B Tallahassee, Florida 32303 Dean Bunch, Esquire Nelson, Mullins, Riley and Scarborough LLP 3600 Maclay Boulevard South, Suite 202 Tallahassee, Florida 32312 June C. McKinney Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 Nalini Vinayak Dealer License Administrator STATE OF FLORIDA DIVISION OF ADMINISTRATIVE HEARINGS MASSEY-YARDLEY CHRYSLER PLYMOUTH, INC., Petitioner, vs. Case No. 11-6492 CHRYSLER GROUP CARCO, LLC, AND AUTONATION DODGE OF PEMBROKE PINES, INC., Respondents.
The Issue The issues to be resolved in this proceeding concern whether the Respondent should be granted an Independent Motor Vehicle Dealer License, pursuant to Section 320.27, Florida Statutes (2008).
Findings Of Fact The Department is an agency of the State, charged with regulating the business of buying, selling or dealing in motor vehicles under § 320.27, Florida Statutes (2007). The Respondent applied for a license as an Independent Motor Vehicle Dealer. The application was signed by Harold Gillis. Mr. Gillis is the Respondent's president and sole corporate officer. The Resident Agent is Andrew Kiswani. Mr. Kiswani is also known as Alex Kiswani and Andy Kiswani. On the insurance certificate filed with the license application, Mr. Kiswani is shown as one of the named insureds. Named insureds on this type of insurance certificate are typically the dealer principals, the people actually operating the dealership. Mr. Kiswani is a convicted felon. He was convicted twice for theft of state funds. He has thirteen convictions of failure to file state tax returns and seven convictions of issuance of worthless checks to the Department of Revenue. Mr. Kiswani previously was licensed as a Motor Vehicle Dealer, as President of Ocala Auto and Truck Sales, Inc. That license expired on April 30, 2008. On May 19, 2008, Mr. Gillis and Mr. Kiswani displayed vehicles for sale at Ocala Auto and Truck Sales, Inc.'s former licensed location. Both of them were warned by Department employees to cease the unlicensed activity. On June 2, 2008, Mr. Gillis and Mr. Kiswani again displayed motor vehicles for sale at Ocala Auto and Truck Sales, Inc.'s former licensed premises. They were again warned by Department employees to cease the unlicensed activity. On June 11, 2008, Ocala Auto and Truck Sales, Inc. sold a car to James Reed. That seller failed to apply for a Certificate of Title on behalf of Mr. Reed and failed to pay off a lien on the vehicle, within 10 days of acquisition of the vehicle. Ocala Auto and Truck Sales, Inc., sold a vehicle to Wesley Leon Linsey. On February 7, 2007, the seller failed to apply for a Certificate of Title and registration within 30 days of delivery of the vehicle. On December 28, 2007, Ocala Auto and Truck Sales, Inc. entered into a contract with Darrell Lenamond for the consignment sale of a motor vehicle owned by Mr.Lenamond. Ocala Auto and Truck Sales, Inc. sold the vehicle and never paid Mr. Lenamond the money due him from the sale. Mr. Kiswani operated Mr. Gillis's previous dealership. He would be actively involved in operating the dealership for which the license is sought, by the Respondent Corporation, as its Resident Agent.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record and the candor and demeanor of the witnesses, it is RECOMMENDED: That the Florida Department of Highway Safety and Motor Vehicles enter a Final Order denying the Respondent's license application. DONE AND ENTERED this 31st day of July, 2009, in Tallahassee, Leon County, Florida. S P. MICHAEL RUFF Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 31st day of July, 2009. COPIES FURNISHED: Electra Theodorides-Bustle, Executive Director Department of Highway Safety and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway Tallahassee, Florida 32399-0500 Robin Lotane, General Counsel Department of Highway Safety and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway Tallahassee, Florida 32399-0500 Michael James Alderman, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A-432 2900 Apalachee Parkway Tallahassee, Florida 32344 Harold Gillis Certified Motors, Inc. 2895 South Pine Avenue Ocala, Florida 34471
The Issue The issue is whether Petitioner's establishment of North Tampa Chrysler Jeep Dodge, Inc. (North Tampa), as a successor motor vehicle dealer for Chrysler, Jeep and Dodge line-makes (vehicles) in Tampa, Florida, is exempt from the notice and protest requirements in Subsection 320.642(3), Florida Statutes (2009),1 pursuant to Subsection 320.642(5)(a).
Findings Of Fact Petitioner manufactures and sells Chrysler, Jeep and Dodge vehicles to authorized Chrysler, Jeep and Dodge dealers. Ulm is a party to Dealer Sales and Service Agreements with Petitioner for Chrysler, Jeep and Dodge vehicles. Ulm sells Chrysler, Jeep and Dodge vehicles at 2966 North Dale Mabry Highway, Tampa, Florida 33607. Ferman is a party to Dealer Sales and Service Agreements with Petitioner for Chrysler, Jeep and Dodge vehicles. Ferman sells Chrysler, Jeep and Dodge vehicles at 24314 State Road 54, Lutz, Florida 33559. It is undisputed that Petitioner has had four dealers in the Tampa metro market for a significant number of years. Petitioner's primary competitors also have had four or more dealers in the Tampa metro market. By appointing North Tampa as a successor dealer to Bob Wilson Dodge Chrysler Jeep (Wilson), Petitioner seeks to maintain the status quo of four Chrysler dealers in the Tampa metro market. In April 2008, Petitioner had four dealers in the Tampa metro market that each sold and serviced Chrysler, Jeep and Dodge vehicles. The four dealers were: Ulm, Ferman, Courtesy Chrysler Jeep Dodge, and Wilson. On April 25, 2008, Wilson filed a Chapter 11 petition in United States Bankruptcy Court in the Middle District of Florida (the Bankruptcy Court). At or about the same time, Wilson closed its doors and ceased selling and servicing Chrysler, Jeep and Dodge vehicles. The filing of Wilson’s bankruptcy petition precipitated an automatic stay under Section 362 of the Bankruptcy Code. The automatic stay prevented Petitioner from terminating Wilson’s franchise and dealer agreements (dealer agreements). But for Wilson’s bankruptcy filing, Petitioner would have sent Wilson a notice of termination when Wilson closed its doors and ceased dealership operations. Wilson’s cessation of business adversely impacted Petitioner. In relevant part, Petitioner lost sales and lacked a necessary fourth dealer to provide service to Chrysler, Jeep and Dodge customers in the Tampa metro market. Petitioner desired to reopen a dealership at or close to the former Wilson location as soon as possible to mitigate or eliminate the economic loss. During the automatic stay, Petitioner was legally precluded from unilaterally appointing a successor dealer to Wilson. Wilson still had valid dealer agreements for the Chrysler, Jeep and Dodge vehicles and, therefore, was still a dealer. During the automatic stay, Wilson attempted to sell its existing dealership assets, including the Chrysler, Jeep and Dodge dealer agreements. Any attempt by Petitioner to appoint a successor dealer or even negotiate with a successor dealer, would have undermined Wilson’s efforts to sell the dealerships and maximize the estate for the benefit of the creditors. A sale of the dealership required the consent of Wilson and Wilson’s largest creditor, Chrysler Financial. Petitioner did everything it could to accelerate a sale. However, Petitioner was not a party to the sale negotiations and had no ability to require or force Wilson to sell the dealership or its assets to any particular party or to do so within any particular time period. A preponderance of the evidence does not support a finding that Petitioner did anything to intentionally, or inadvertently, delay or manipulate the timing of a sale. On July 30, 2008, Petitioner filed a motion with the Bankruptcy Court to lift the automatic stay. The motion also sought the termination of Wilson’s dealer agreements. Petitioner filed the motion in the Bankruptcy Court in an attempt to hasten the sale negotiations. Petitioner also wanted to be able to terminate the dealer agreements as quickly as possible in the event that a sale was not consummated. The Bankruptcy Court did not initially grant Petitioner's motion. The court wanted to allow time for a sale of the dealership to proceed. During 2008 and early 2009, Wilson continued to negotiate with potential buyers for the dealership. On January 8, 2009, Wilson's motor vehicle dealer license expired. It became apparent to Petitioner that a sale of Wilson’s assets would be unlikely. Petitioner again asked the Bankruptcy Court to grant Petitioner's motion to lift the stay. On February 9, 2009, the Bankruptcy Court entered an order granting Petitioner's motion to lift the stay. However, the order did not terminate Wilson’s dealer agreements. On February 16, 2009, within a week of the entry of the order lifting the stay, Petitioner sent Wilson a notice of intent to terminate Wilson’s dealer agreements. Wilson received the notice of termination on February 23, 2009, and the termination became effective on March 10, 2009. A preponderance of evidence does not support a finding that Petitioner attempted to manipulate or delay the timing of the termination of Wilson’s dealer agreements. Petitioner began working on establishing a replacement dealership as soon as Wilson’s dealer agreements were terminated. Establishing a replacement dealership is a lengthy process that primarily involves finding a suitable dealer candidate, finding a suitable location and facility, and making sure that the candidate has the necessary capital to start and maintain the dealership. Petitioner talked to several potential candidates to replace the Wilson dealership, including Jerry Ulm, the principal of one of the complaining dealers in these cases. By letter dated June 24, 2009, Mr. Ulm advised Petitioner that he opposed the opening of a successor dealership for anyone else but wanted the successor dealership for himself should Petitioner decide to proceed. Petitioner determined that Petitioner would not be able to locate the successor dealership at the former Wilson facility. Petitioner considered several potential alternative locations for the successor dealership, including property offered by Ferman. Ferman had a vacant site on Fletcher Avenue in Tampa, Florida, which Ferman leased from a third party unrelated to this proceeding. Ferman offered to sublease the property to Petitioner. In a letter to Petitioner's real estate agent dated July 17, 2009, Ferman stated Ferman's understanding that Petitioner intended to use the property to establish a Chrysler, Jeep and Dodge dealership. Petitioner ultimately decided to locate the dealership at 10909 North Florida Avenue in Tampa, Florida. It is undisputed that this location is less than two miles from the former Wilson location. Before establishing the successor dealership, however, Petitioner wrote a letter to the Department on February 5, 2010 (the letter). The letter requested the Department to confirm that the establishment of the successor dealership would be exempt under Subsection 320.642(5)(a)1. from the notice and protest requirements in Subsection 320.642(3). The letter explained that Wilson had filed bankruptcy and ceased operations and that the bankruptcy had prevented Petitioner from terminating Wilson and appointing a successor dealership. The letter also provided the relevant dates of the bankruptcy, the lifting of the stay, and the termination of Wilson dealer agreements and advised the Department of Petitioner's intent to locate the successor dealership within two miles of Wilson’s former location. The letter asked the Department to confirm that the establishment of a successor dealership would be exempt if it was established within one year of March 10, 2009, when Petitioner terminated the Wilson dealer agreements. By separate e-mails dated February 9 and 12, 2010, the Department twice confirmed that it had consulted with counsel and determined that the establishment of a successor dealership to Wilson in the manner outlined by Petitioner would be exempt. Petitioner relied on this confirmation by the Department before proceeding with the appointment of a successor dealership. On February 24, 2010, Petitioner sent a second letter to the Department, stating Petitioner's intention to appoint North Tampa as the replacement and successor dealer for Wilson (the second letter). In the second letter, Petitioner again asserted its understanding that the establishment of North Tampa was exempt from the relevant statutory requirements for notice and protest. On February 24, 2010, Petitioner also submitted to the Department an application for a motor vehicle dealer license for North Tampa. On March 3, 2010, the Department issued a license to North Tampa for the Chrysler, Jeep and Dodge vehicles at 10909 North Florida Avenue in Tampa, Florida. On March 7, 2010, North Tampa opened for business. North Tampa has operated successfully and continuously and employs approximately 30 individuals at the site.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order finding that the establishment of North Tampa as a successor motor vehicle dealer is exempt from the notice and protest requirements in Subsection 320.642(3) pursuant to Subsection 320.642(5)(a). DONE AND ENTERED this 11th day of October, 2010, in Tallahassee, Leon County, Florida. S DANIEL MANRY Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 11th day of October, 2010.
The Issue Whether Respondent, Maserati North America, Inc.’s ("MNA"), proposed 2017 Commercial Policy Program ("2017 Program") is a modification of the franchise agreement between MNA and Petitioner, New Country Motor Cars of Palm Beach, LLC, d/b/a Maserati of Palm Beach ("Palm Beach"), or Petitioner Recovery Racing, LLC, d/b/a Maserati of Ft. Lauderdale ("Fort Lauderdale"); and, if so, whether it is fair and not prohibited by section 320.641(3), Florida Statutes (2016). Whether MNA’s proposed modifications to the Existing Franchise Agreements with Petitioners are fair and not prohibited under section 320.641(3).
Findings Of Fact Based on the evidence presented, the Pre-hearing Stipulation of the parties and the record as a whole, the following relevant and material Findings of Fact are made2/:
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that: A final order be entered by the Department of Highway Safety and Motor Vehicles: (1) DISMISSING Petitioners’ claims regarding MNA’s 2017 Commercial Policy Bonus Program; and (2) GRANTING, IN PART, AND DENYING, IN PART, Petitioners’ claims regarding modifications in the Proposed New Agreement, as set forth above. DONE AND ENTERED this 23rd day of January, 2018, in Tallahassee, Leon County, Florida. S ROBERT L. KILBRIDE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 23rd day of January, 2018.
The Issue Whether General Motors' decision not to renew its franchise agreement with Gallman Pontiac was "unfair" as the term is defined by Section 320.641(3), Florida statutes.
Findings Of Fact Background On or about October 28, 1988, (general Motors Corporation, Pontiac Division (General Motors) notified it franchisee, Bill Gallman Pontiac, GMC Truck, Inc. (Gallman Pontiac), a licensed motor vehicle dealer in the State of Florida, of its election not to renew the franchise agreement, effective ninety days from the date of the delivery of the notice of its decision. Because the franchise agreement was scheduled to expire on November 20, 1988, Bill Gallman would have the option to void the nonrenewal due to General Motor's failure to notify the motor vehicle dealer ninety days in advance of the proposed nonrenewal. To avoid this result and to comply with the franchise agreement, General Motors informed the dealer in the same notification that the current agreement was being extended for the same ninety day period in which the dealer had been given notice of the proposed nonrenewal. General Motors' extension of the term of the franchise agreement was a unilateral proposed novation that was accepted by Gallman Pontiac when he relied upon the modification and continued to do business under the novation. Gallman Pontiac's acceptance of the novation is clearly demonstrated by the timing of the verified complaint in this proceeding, which was filed on January 12, 1989. The specific reason stated by General Motors for its decision not to renew its franchise agreement beyond the ninety-day period was that Gallman Pontiac failed to fulfill its minimum sales performance responsibilities pursuant to its contractual obligations as set forth in the Dealer Sales and Service Agreement. Gallman Pontiac subsequently filed a verified complaint, pursuant to Section 320.641, Florida Statutes, to contest the proposed nonrenewal of the franchise agreement. The complaint alleges that the proposed nonrenewal is unfair and that the grounds asserted for the nonrenewal were factually untrue and/or legally insufficient for the intended purpose. The Mathematical Formula for Sales Effectiveness The manufacturer's primary purpose for entering into a franchise agreement with a dealer is to have its automobiles sold. To determine whether a dealer is meeting its responsibilities in this regard, the franchise agreement contains a mathematical formula which is used to evaluate the sales performance of all dealers who sell Pontiacs. Pursuant to the formula, which is expressed in the agreement and tide annual sales performance evaluation form, a dealer's sales ratio and registration ratio must be calculated. A dealer's sales ratio is determined by dividing the dealer's actual unit sales of new motor vehicles, wherever registered, by industry new unit registrations in the Dealer's Area of Prime Responsibility. A dealer's registration ratio is determined by dividing new motor vehicle unit registrations by industry new unit registrations in the Dealer's Area of Prime Responsibility. After these ratios are recorded, the dealer's sales and registration ratios are compared to zone and national registration ratio levels to determine sales and registration effectiveness. If the individual dealer's sales and registration performances reach a comparative level of 85 percent effectiveness to the zone and national levels, the dealer's performance is considered effective by General Motors. When the comparisons were made in this case, the dealer's sales effectiveness was 53.6 percent in 1987 and 68.5 percent in 1988. Registration effectiveness was 56.5 percent in 1987 and 74.1 percent in 1988. These levels of performance do not meet the minimum levels required by the franchise agreement. Other Considerations Under the Agreement In addition to the mathematical formula, the franchise agreement states that General Motors will consider other relevant factors in its sales evaluation, including the following factors: the trend over a reasonable period of time of dealer's sales performance; the manner in which dealer has conducted the sales operations, including advertising, sales promotion and treatment of customers; sales to fleet customers if they have affected registrations; the manner in which dealer has submitted orders for new motor vehicles to the Pontiac Division; the availability of new motor vehicles to dealer; and significant local conditions that may have directly affected dealer's performance. If the mathematical formulas regarding sales and registration effectiveness set forth in the franchise agreement were the sole measure used to determine Gallman Pontiac's sales performance through January 1989, it is clear that the dealer was not meeting its contractual obligations to General Motors in this area of responsibility. However, under the terms of the agreement, General Motors must look to other relevant factors that may have directly affected dealer's performance before a final determination can be made regarding an individual dealer's sales effectiveness. Contrary to the terms of the agreement, the annual evaluation forms show that Gallman Pontiac's performance was evaluated on retail sales only. The other relevant factors in the franchise agreement were not reviewed before the decision not to renew the franchise agreement was made. Other Relative Factors in the Agreement Which Should Have Been Considered in the Dealers Evaluation When the trend of the Gallman Pontiac's sales performance is reviewed, the evidence shows that Gallman Pontiac's sales performance over the life of the franchise agreement has improved relative to market growth by a small percentage (7.51%). This slight upward trend does not demonstrate an effective performance as the sales were below an acceptable standard before the increase in sales, and the improvement barely exceeded the local market growth. The time period over which the trend evaluation occurred is reasonable in this case because both parties agreed to a two-year term in the franchise agreement, which was subject to an overall evaluation prior to a renewal of the agreement. Although there was opinion testimony from a former sales manager from the dealership that Gaillman Pontiac did not order sufficient quantities and mix of vehicles, and imprudently focused the advertising towards the limited, younger group of buyers in Naples, this testimony was not found to be credible by the Hearing Officer. All of the other evidence presented by both sides regarding the manner in which the dealer conducted sales operations demonstrates that Gallman Pontiac met or exceeded his contractual obligations in this area of responsibility. Sales to fleet customers did not affect registrations in 1988. The dealer chose not to compete in the fleet market because the later resale of these vehicles interferes with the sale of new vehicles at this dealership. The manner in which the dealer submitted orders to the Pontiac Division was not criticized by General Motors. The dealer's procedures were continuously reviewed and evaluated through the Dealer Assistance Program. There was no showing that the dealer's ordering procedures directly affected its sales performance. The allocation procedures were applied to Gallman Pontiac in the same manner they were applied to other dealers. The evidence did not show that imprudent selections were made by the dealer in the ordering process, nor was it sufficiently established that manufacturer delays or the unavailability of certain products interfered with the dealer's sales in Naples. A significant local condition that may have directly affected the dealer's sales performance was the lack of receptivity in the Naples market area for linemakes in the class of automobiles offered by Pontiac. Actual sales performance data for all new car registrations in the area show that the Naples market prefers to purchase automobiles from the high group of automobiles such as Cadillac, Lincoln, BMW, Mercedes Benz, and Porsche. Pontiac does not have a linemake designed to compete in this market segment. Application of the Other Relevant Factors To The Decision Not To Renew Because the franchise agreement and the annual sales evaluation form have not made provisions for any adjustments to the original statistical formula based upon the additional considerations mentioned in paragraphs 9-13, these factors are to be considered independently from the initial mathematical calculation. The purpose of the review of these factors is to determine if the statistical analysis is a reliable indicator of the sales performance of the dealer who is being evaluated before General Motors makes its final decision regarding termination. There has been no showing that General Motors ever used the additional considerations for any other purpose in its course of dealings with other dealers in the past or that any other interpretation has been given to these factors. In this case, when the additional relevant factors are reviewed in addition to the ineffective sales and registration performance statistics, the mathematical formula continues to be a reliable indicator that the sales performance at the Gallman Pontiac dealership does not meet required standards. The additional considerations set forth in the franchise agreement which are relevant to this case, do not seriously undermine the fairness of the application of the initial mathematical calculation to the sales performance of Gallman Pontiac. While the local market's lack of receptivity directly affects Gallman Pontiac's performance, the statistical formula takes this into account to a large degree when a dealer is required to meet eighty-five percent of the zone or national average to demonstrate minimum performance. If yet another mathematical formula was created to give additional weight to this local condition beyond the provision in the minimum standards formula, the manufacturer could be harmed by a individual dealer's lack of market penetration efforts. Because it is difficult to determine the primary cause and effect of poor market penetration in a specific area, the statistical formula is generally fair to both sides in most situations. It does not unfairly accuse either the dealer or the manufacturer as being responsible for the lack of sales. One indicator of the fairness involved in the application of the formula as designed can be found in Mr. Anderson's comparative analysis of the Naples automobile market and the Sarasota market. Mr. Anderson is the expert in automobile marketing analysis presented by General Motors. This analysis refutes the opinion of Dr. Ostlund, the expert presented by Gallman Pontiac during the hearing regarding automobile marketing analysis. It is Dr. Ostlund's opinion that Naples is a unique market in which the usual statistical formula becomes unfair if it is applied to all registrations in the Dealer's Area of Responsibility. Based upon this analysis, Dr. Ostlund suggests that a weighted average be applied in the standard formula to all of the sales made by Gallman Pontiac during the franchise period. However, even if this were done, Gallman Pontiac's performance would have been 84.7 percent, which is still below the required standard of 85 percent. Contrary to Dr. Ostlund's analysis, the Naples-Sarasota comparison conducted by Mr. Anderson demonstrates that Pontiac can compete in a high income area with similar demographics to Naples within the same zone along the same Florida coast. Therefore, the usual statistical formula remains a reliable indicator of the sales effectiveness of a Pontiac dealer in Naples, Florida, and should be applied without any further weighting of averages in the statistical analysis required by the franchise agreement. Application of Additional Factors Relevant to the Decision Not to Renew Pursuant to Statute A nonrenewal of the franchise agreement is clearly permitted by the franchise agreement. The nonrenewal has been undertaken in good faith and good cause. The manufacturer has continuously encouraged the dealer to meet sales performance standards and has worked with Gallman Pontiac in an effort to achieve this goal within the time frame agreed to by the parties. Because franchise dealers are the major outlet the manufacturer has for the sale of new automobiles, it is essential that minimum levels of sales performance are achieved on a regular basis. Failure to meet the minimum sales performance over the term of this agreement by Gallman Pontiac is a material and substantial breach of the contract.
Recommendation Based upon the foregoing, it is RECOMMENDED: That the Department of Highway Safety and Motor Vehicles enter a Final Order dismissing Gallman Pontiac's complaint with prejudice. DONE and ENTERED this 28 day of June, 1990, in Tallahassee, Leon County, Florida. VERONICA E. DONNELLY Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904)488-9675 Filed with the Clerk of the Division of Administrative Hearings this 28 day of June, 1990. APPENDIX TO RECOMMENDED ORDER IN CASE NO. 89-0505 Petitioner's Proposed Findings of Fact are addressed as follows: Accepted. See HO #1. Accepted. See HO #3. Reject all but last sentence. Conclusions of Law. Accept the last sentence. Rejected. Conclusion of Law. Accepted. Reject that the dealer code problem can be attri- buted to the conduct of the manufacturer. Insufficient proof. Accepted. Accepted. Accepted. Rejected. Reject the weighted average basis. See HO #14 and #15.. Rejected. Irrelevant. Rejected. Irrelevant. Accepted. See HO #4. Accepted. See HO #6. Accepted. Accepted. Accepted. Rejected. Speculative. Rejected. Contrary to fact. See HO #15. Rejected. Contrary to fact. See HO #15. Rejected. Contrary to fact. See HO #15. Rejected. Irrelevant. Rejected. Irrelevant. Accepted. See HO #17. Rejected. Irrelevant. Attempt to shift evidentiary burden. Rejected. See HO #15. Accepted. See HO #13. Rejected. See HO #15. Rejected. See HO #15. Accepted. See HO #13. Accepted. See HO #13. Accepted. Accepted. Accepted. Accepted. See HO #8. Accepted. Rejected. See HO #15. Accepted. Accepted. Rejected. Irrelevant. Accepted. Rejected. See HO #15. Accepted. Rejected. See HO #14. Accepted. Accepted. Accept that additional factor's need to be considered. Rejected Dr. Ostlund's interpretation. See HO #9 through #15. Rejected. Improper summary. Rejected. Irrelevant. Accepted. See HO #6. Accepted. Accepted, except for the last sentence which is an opinion or closing argument as opposed to a finding of fact. Accepted. Rejected. See HO #14. Accepted. Accepted, except for Nissan. Accepted. Accepted. Rejected. See HO Accepted. Accepted. Rejected. Closing argument as opposed to finding of fact. Rejected. Irrelevant and contrary to fact. Accepted. Accepted. Accepted. Accepted. Rejected. Irrelevant. Rejected. Contrary to fact. Rejected. Conclusionary. Accepted. Rejected. Irrelevant. Rejected. See HO #10. Rejected. See HO #17. Rejected. See HO #15 and #17. Rejected. See HO #17. Accepted. Rejected. Contrary to fact. See HO #17. Respondent's Proposed Findings of Fact are addressed as follows: Accepted. Rejected. Irrelevant. Rejected. Irrelevant. Accepted. See HO #6. Accepted. See HO #6. Accepted. See HO #6. Accepted. See HO #8. Accepted. Accepted. Accepted. Accepted. Accepted. See HO 415. Accepted. Accepted. Accepted. See HO #15. Accepted. Accepted. See HO #15. Accepted. See HO #13. Accepted. Accepted. Accepted. See HO #15. Accepted. Accepted. Accepted. Accepted. See HO #11. Accepted. Accepted. Accepted. Accepted. Rejected. Irrelevant. Accepted. See HO #15. Rejected. Irrelevant. Accepted. Accepted. Rejected. Redundant. Accepted. Rejected. Irrelevant. Rejected. Irrelevant. Accepted. Accepted. Accepted. Accepted. Rejected. Irrelevant. Accepted. See HO #14. Accepted. Accepted. See HO #9. Rejected. Unreliable conclusion. Accepted. See HO #17. Rejected. Irrelevant. Outside the reasons given for nonrenewal. See HO #8. Rejected. Same reason as given in above. Rejected. Same reason as 49 and 50. Also contrary to fact. Rejected. Irrelevant to this hearing. Rejected. Irrelevant to this hearing. Accepted. See HO #17. Accepted. See HO #15. Rejected. Redundant and argumentative. Accepted. Accepted. Rejected. Improper argument. Rejected. The use of "sales reported" was allowed by the Hearing Officer at hearing. Rejected. Irrelevant in these proceedings. Rejected. Irrelevant and unreliable speculation. Rejected. Irrelevant. Rejected. Irrelevant. Rejected. Dr. Ostlund was very credible. Mr. Anderson's analysis, based upon y~he Sarasota- Naples comparison, which tended to refute the testimony of Dr. Ostlund, was given greater weight by the Hearing Officer. COPIES FURNISHED: James D. Adams, Esquire Michael J. Alderman, Esquire Feaman, Adams, Harris, Department of Highway Fernandez & Deutch, P.A. Safety And Motor Vehicles Corporate Plaza, Fourth Floor Neil Kirkman Building 4700 N.W. Second Avenue Tallahassee, Florida 32399-0500 Boca Raton, Florida 33431 S. William Fuller, Jr., Esq. Vasilis C. Katsafanas, Esquire Fuller Johnson & Farrell Rumberger, Kirk, Caldwell, Post Office Box 1739 Cabaniss, Burke & Wechsler Tallahassee, Florida 32302 11 East Pine Street Orlando, Florida 32802 Charles J. Brantley, Director Division of Motors Vehicles William J. Whalen, Esquire Department of Highway Office of General Counsel Safety and Motor Vehicles General Motors Corporation B439 Neil Kirkman Building New Center One Building Tallahassee, Florida 32399-0500 3031 West Grand Boulevard Detroit, Michigan 48232 Enoch J. Whitney, Esquire General Counsel S. Thomas Wienner, Esquire Departments of Highway Dykema Gossett Safety and Motor Vehicles 35th Floor Neil Kirklan Building 400 Renaissance Center Tallahassee, Florida 32399-0500 Detroit, Michigan 48243
The Issue The issue in the case is whether an application for a new point franchise motor vehicle dealership filed by El Sol Trading, Inc., and Finish Line Scooters, LLC (Petitioners), should be approved.
Findings Of Fact There was no evidence presented at the hearing to establish that the Respondent has a franchise agreement to sell or service CHUA motor vehicles, the line-make to be sold by Finish Line Scooters, LLC. There was no evidence presented at the hearing that the Respondent's dealership is physically located so as to meet the statutory requirements for standing to protest the establishment of the new point franchise motor vehicle dealership.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order dismissing the protest filed in this case by Scooter Elite, LLC, and granting the Petitioners' request to establish a new point franchise motor vehicle dealership for the sale of CHUA motorcycles. DONE AND ENTERED this 9th day of March, 2010, in Tallahassee, Leon County, Florida. S WILLIAM F. QUATTLEBAUM Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 9th day of March, 2010. COPIES FURNISHED: Jennifer Clark Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A-308 2900 Apalachee Parkway Tallahassee, Florida 32399-0635 Gloria Ma El Sol Trading, Inc., d/b/a Motobravo, Inc. 19877 Quiroz Court City of Industry, California 91789 Kirit Kana Scooter Elite, LLC 7204 Central Avenue St. Petersburg, Florida 33707 John V. Leonard Finish Line Scooters, LLC 6600 Gulf Boulevard St. Pete Beach, Florida 33706 Carl A. Ford, Director Division of Motor Vehicles Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room B-439 2900 Apalachee Parkway Tallahassee, Florida 32399-0500 Robin Lotane, General Counsel Department of Highway Safety and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway Tallahassee, Florida 32399-0500
