The Issue Whether the intended termination under that Notice of Termination of the Dealer Sales and Service Agreement, dated December 7, 2010, between Respondent Nissan North America, Inc., and Petitioner Hampton Automotive Group, Inc., d/b/a Hampton Nissan, is unfair or prohibited within the meaning of section 320.641, Florida Statutes.
Findings Of Fact Hampton is a “motor vehicle dealer,” as defined by section 320.60(11)(a), Florida Statutes. Nissan is a “licensee” as defined by section 320.60(8). Nissan does not sell cars directly to consumers in the state of Florida. Rather, it relies on its dealers to market and sell its vehicles to consumers. Hampton Automotive Group, Inc., purchased the Nissan dealership in Fort Walton Beach, Florida, on August 4, 1998, and entered into a Dealer Sales and Service Agreement with Nissan (Dealer Agreement). Mark Hampton is the 100 percent owner of Hampton.1/ The Dealer Agreement is a “franchise agreement” as defined by section 320.60(1). The Dealer Agreement, like other Dealer Sales and Service Agreements that Nissan enters with its dealers, contains several provisions designed to ensure that Hampton achieves and maintains sufficient levels of sales performance. Section 3 of the Dealer Agreement entitled “Vehicle Sales Responsibilities of Dealer,” sets forth Hampton's obligations with respect to the sale of vehicles. Section 3A sets forth the general sales obligation of Hampton, which is to “actively and effectively promote through its own advertising and sales promotion activities the sale at retail (and if Dealer elects, the leasing and rental) of Nissan Vehicles to customers located within the Dealer’s Primary Market Area.” Article Second, Section B outlines the same general obligation. Section 3B of the Dealer Agreement provides that “performance of [Hampton's] sales responsibility for Nissan Cars and Nissan Trucks will be evaluated by [Nissan] on the basis of such reasonable criteria as [Nissan] may develop from time to time.” This provision allows Nissan to evaluate Hampton's sales performance using any method, so long as it is reasonable. The Dealer Agreement contains specific examples of reasonable criteria that Nissan may use to evaluate sales performance. Although the Agreement does not restrict Nissan to the listed examples, Nissan uses sales penetration, which is “Dealer’s sales as a percentage of registrations of competitive vehicles,” as an example of reasonable criteria in section 3(B)(2)(ii). Section 3(B)(3) of the Dealer Agreement also specifies the region benchmark to which a dealer’s sales penetration is compared, stating that a dealer’s sales penetration may be compared to the “sales and/or registrations of all other Authorized Nissan Dealers combined in Seller’s Sales Region.” As permitted by section 3 of the Dealer Agreement, Nissan uses Retail Sales Effectiveness (RSE) to determine whether a dealer is meeting its sales obligation under the Agreement. RSE is calculated by first determining the dealer’s sales penetration or market share, which is the dealer’s total new Nissan vehicle sales anywhere, divided by the number of competitive new vehicles registered in the dealer’s Primary Market Area (PMA). The resulting number is expressed as a percentage to show the dealer’s sales penetration. The dealer’s sales penetration is then compared as a ratio to the sales penetration of the entire Nissan region, to determine the dealer’s RSE. A simple expression of the RSE formula is: Dealer’s Sales Penetration ÷ Region Sales Penetration. Breaking down each of these into their component parts, the RSE calculation would be: (Dealer’s sales anywhere ÷ Competitive Registrations in the Dealer’s PMA)÷(Combined Sales of all Region Dealers ÷ Competitive Registrations in the Region) A dealer who reaches 100 percent RSE is performing at an average level, which is a “C” level of performance. Although the terminology and calculations may vary slightly, RSE or sales penetration is the industry standard method used to measure dealer sales performance. RSE is a fair method of evaluating dealer performance with conservative expectations because no dealer is expected to perform above an average level and because the dealer gets credit for sales anywhere, while only being held responsible for the sales opportunities within its PMA. Approximately 60 percent of dealers in the Nissan's Southeast Region, within which Hampton is located, meet or exceed the “average” sales penetration of 100 percent RSE. Nissan has been using RSE as its standard to measure dealer sales performance for over 30 years. This evaluation method is communicated to dealers not only in the Dealer Agreement, but also in contacts and visits with the dealer and correspondence. Hampton’s owner admits that he knew Nissan was evaluating the dealership’s sales performance using RSE. RSE is a reasonable criterion to measure dealer sales performance and it was reasonable for Nissan to evaluate Hampton's sales performance using RSE. At the Final Hearing, Hampton argued that it should be evaluated based on market penetration rather than sales penetration. Market penetration is the ratio of Nissan registrations in a dealer’s PMA, no matter what dealer sold the vehicle, to competitive registrations in the PMA, which is then compared to Region average. Because market penetration looks at registrations in the market by any dealer, it does not measure the efforts or sales performance of the dealer in the market. Using market penetration as a measure artificially increases the perception of the sales effectiveness of an underperforming dealer because that dealer would get credit for sales made by other dealers through no effort of the underperforming dealer. Using the market penetration calculation, a dealer could sell no vehicles, yet reach 100 percent (or more) of region average base upon sales by other dealers to customers in its PMA. The market penetration within Hampton's PMA for years 2008 through 2010 was higher than Hampton's sales penetration within that PMA, indicating that consumers within Hampton's PMA desired Nissan’s products, but not so much from Hampton. Neither Nissan nor any other manufacturer uses market penetration to measure the sales performance of a dealer. Market penetration is not a reasonable criterion to measure Hampton's performance under the Dealer Agreement. Section 3H of the Dealer Agreement provides that Nissan will “periodically evaluate” Dealer’s performance of its sales responsibilities and discuss these evaluations with the dealer. The dealer agrees to correct any deficiencies. Nissan evaluates its dealers and provides feedback on their performance in several ways. First, Nissan has District Operations Managers (DOMs) who call on dealers routinely to discuss various areas of performance, and to review reports that outline the dealer's RSE performance and other information pertinent to dealer operations. Various department and training managers from Nissan may also assist a dealer. Nissan's senior management often notifies a dealer of violations of the Dealer Agreement, including poor sales performance. Nissan DOMs have extensive industry experience and have had the opportunity to work with top-performing dealers, as well as poor-performing dealers. DOMs provide advice and counsel and share best practices with dealers on things that can impact sales, including items such as customer service, product training, inventory management, and other areas. DOMs also share data with dealers to help identify areas of opportunity to grow and improve. Nissan counseled with Hampton and its owner for a number of years regarding Hampton's poor sales performance and operational deficiencies prior to the December 2010 Notice of Termination. Since becoming a Nissan dealer in 1998, Hampton has performed poorly from a sales perspective. In 2002 and 2003, Nissan issued several notices of default to Hampton based on their unsatisfactory sales performance and related operational deficiencies. On November 3, 2003, Nissan issued Hampton a notice of termination for poor sales performance. Around the same time, Nissan conducted a nationwide audit of dealer PMAs. As part of that audit, Nissan instituted a new rule limiting the size of a PMA to 25 miles. As a result of this new rule, Hampton’s PMA was reduced in size. Because Hampton was responsible for a smaller area, its sales penetration increased to 80 percent of average. Although this performance was still poor because it was 20 percent less than average, it was not among the worst in the state, and Nissan withdrew the NOT. After Nissan withdrew its NOT, Hampton’s operations did not change, and its RSE drifted back towards the bottom of the state, even in its reduced PMA. For the next few years, Nissan continued counseling with Hampton regarding its declining sales penetration, poor customer service scores, lack of training for its employees, and other problems at the dealership. During this time, Hampton experienced significant management turnover. Article Fourth of the Dealer Agreement, stresses the importance of "qualified management" for the dealer and requires Hampton to provide a qualified executive manager with "full managerial authority for [Hampton's operations], . . . [who] shall continually provide his or her personal services in operating the dealership and [who] will be physically present at the Dealership Facilities." The lack of a qualified executive manager was an ongoing problem at Hampton. Nissan continuously counseled with Hampton concerning this issue. Ben Bondi was the last approved executive manager at the dealership.2/ Following his departure in 2005, Hampton had a number of managers in a few short years. In mid-2005, after Ben Bondi was let go, Carl Roscitti became general manager for about five months. By November 2005, Mr. Roscitti was gone, and Rick Himmel was the manager for two months. Following Mr. Himmel's departure, in February 2006, Al Brockette served as manager for about three months. Alan Reese replaced him for three months beginning in April 2006. Brent Joy took over for Mr. Reese in August 2006 for a month. In September 2006, Tom Buckley took over for two or three months. None of these individuals were provided with the level of authority or decision-making ability expected of an executive manager. Throughout this period of management turnover, Hampton’s sales performance was declining. By the end of 2006, Hampton’s RSE, even in its new PMA, had fallen to 75.41 percent, which ranked it 132/154 dealers in the Southeast Region, 50/58 dealers in the State of Florida, and last among the 15 dealers in Hampton’s district. In 2007, Rusty Chambers and Jeff Kagan served as the management team at Hampton. Although neither of these individuals served as executive manager, they provided some consistency at the dealership, and they had more authority than prior managers. Operations improved somewhat under their management. For the first time in its history, Hampton reached region average in 2007, at 102.7 percent. In February 2008, after reaching region average RSE in 2007, Mr. Hampton intentionally put his dealership on finance credit hold so it could not order any more vehicles. This cancelled all vehicle orders and prevented the dealership from purchasing inventory. By taking this action, Hampton not only reduced its present inventory, but also lowered its sales rate, impacting future allocations. Upon learning that Hampton was on finance hold, Nissan notified Mr. Hampton of the drastic impact this would have on sales performance, incentives, and future allocations. During a meeting with the DOM, Mr. Hampton said that he had too much inventory and that he planned to force his sales staff to sell what they had before ordering any more. On March 6, 2008, with the finance hold still in place, Nissan personnel sent a letter to Hampton and met with its owner to discuss the situation. Although the flooring line had been suspended for over a month, the owner said he “planned to leave [the suspension] in place and force the staff to sell what they currently had available.” When told that this was a violation of the Dealer Agreement, Mr. Hampton stated that “he did not care about the agreement because Nissan had already tried to get him once and they could not get him.” Having a dealership put itself on finance hold is extremely unusual, and Nissan personnel had never seen any other dealership take this type of action. Even Hampton’s own expert agreed he would not recommend it. This operational decision had a direct impact on Hampton’s sales performance in 2008 and beyond. After Hampton put itself on finance hold, its inventory dropped from 160 vehicles to 60, and its sales penetration began to drop immediately. By mid-2008, Mr. Hampton had fired the management team of Rusty Chambers and Jeff Kagan, and the management turnover resumed. Following their departure, Ralph Harris served as sales manager at the store, and there was no executive or general manager. Nissan continued to counsel with Hampton throughout 2008 concerning sales performance, the lack of an executive manager, and operational deficiencies. During meetings with the dealership, the DOM reviewed empirical data and discussed areas of opportunity for the dealership. Rather than discussing ways to implement the suggestions and improve performance, Hampton’s owner accused the DOM of being critical, and would try to change the subject to irrelevant matters whenever the DOM asked a challenging question about dealership operations. Hampton’s performance continued to decline. In July 2008, Nissan’s DOM contacted Hampton’s owner to discuss the dramatic drop in sales, poor customer service performance, and what steps the dealership planned to take to turn the business around. Rather than provide an action plan, Mr. Hampton stated that he had nothing further to discuss and did not see the point of meeting with the DOM. At this point, Mr. Hampton decided he no longer wanted to meet with the DOM or Nissan personnel to discuss dealership business, despite the negative impact this could have on sales performance. By October 2008, the dealership had no executive manager, general manager, sales manager or finance and inventory manager. On several occasions, Nissan personnel attempted unsuccessfully to contact Mr. Hampton to discuss the situation. At the end of October, Carl Stark took over as sales manager at Hampton. Although he claimed to have authority over the store’s operations, he was not an executive manager. He did not have authority over parts, service, pay plans, advertising budget, used vehicle appraisals, or many other facets of the dealership operations. From October 2008 to May 2010, Mr. Stark remained the sales manager, but there was no general manager, executive manager or even an executive manager candidate at Hampton. Although he promoted Mr. Stark and left him in a management position for an extended period of time, Mr. Hampton said he was not effective and was “extremely slow.” By the end of 2008, Hampton’s RSE had dropped to 67.1 percent, which ranked 140/155 dealers in the Southeast Region and 53/58 dealers in the State of Florida. On January 14, 2009, Nissan’s Region Vice President sent a letter to Hampton expressing concern at the declining RSE performance, and asking him to submit a plan for improvement. No plan was ever submitted. Throughout 2009, Mr. Hampton refused to meet with the Nissan DOM, and there was no executive manager at the store. Although Mr. Hampton refused to meet with her, the DOM provided all relevant monthly reports to him by e-mail, expressed concern over the continuing decline in RSE, identified areas of opportunity, suggested best practices that could help the dealership improve, and offered to meet any time to discuss dealership business. Mr. Hampton never responded to any of these overtures. In October 2009, the Region Vice President sent additional letters to Mr. Hampton, expressing concern over the lack of an executive manager at the dealership, the continuing and alarming decline in RSE performance, and the poor owner loyalty that was contributing to this decline. He reminded the dealer of its obligations under the Dealer Agreement and requested that immediate steps be taken to turn things around. By the end of 2009, Hampton’s RSE had dropped to 58.4 percent, which ranked 227/245 dealers in the Region and 56/58 dealers in the State of Florida. In January 2010, Nissan’s fixed operations manager spoke with Mr. Hampton on the phone concerning an available program to help recapture service customers, improve marketing efforts, and increase customer traffic. Mr. Hampton was originally interested in the program, but later called back to decline the program because, according to Mr. Hampton, if it brought in more customers, he would have to hire additional staff, which would drive up expenses. On February 3, 2010, Nick Reese, Nissan’s Area General Manager (AGM), took his whole team to Fort Walton Beach to meet with Mr. Hampton and to express Nissan’s serious concerns over the dealership’s declining RSE and lack of an executive manager. They discussed the dealership’s poor sales performance, now ranked at the bottom of the state, and asked how the dealership planned to improve. Although Mr. Hampton agreed they were not delivering, he would not identify any plan to improve. Instead, he tried to change the subject to some unrelated business deal he was working on and to Hyundai’s launch of a new Sonata. He failed to focus on Nissan sales and expressed no sense of urgency to correct the problems. During this same meeting, Hampton’s sales manager stated that they could not improve sales with the dealership’s existing advertising budget. Advertising was a problem and a major contributor to the lack of traffic at the dealership. Total advertising for the dealership in 2009 had fallen to one-fourth of its 2007 levels –- from over $1 million in 2007 to $242,058 in 2009. Following the meeting, Mr. Reese sent a letter to Hampton concerning the poor RSE and owner loyalty at the store. He asked the dealer to take immediate action to improve, but this was never done. On April 27, 2010, Nissan’s DOM met with Carl Stark, the acting manager, to discuss the continuing decline in RSE, which had fallen to 45.5 percent, 240/244 in the Region and 57/58 in the state. Mr. Stark again expressed concern about the lack of advertising and stated that all advertising was being directed by Mr. Hampton’s staff in Lafayette. On May 4, 2010, Mr. Reese called Mr. Hampton to follow- up on their February meeting. He informed Mr. Hampton that there had been no change in performance, and the dealer would receive a notice of default. During this call, Mr. Hampton admitted he could not manage the store from 300 miles away and stated that it was his entire fault and that he would do the same thing as Nissan since the store is not performing. Mr. Hampton also claimed he had hired a “heavy hitter” to serve as general sales manager and wanted to see if he could turn things around. This new general sales manager never came to work at Hampton in Fort Walton. On May 20, 2010, Nissan issued a notice of default (NOD) to Hampton based on the dealership’s unsatisfactory sales performance and continued lack of an executive manager. The NOD provided Hampton with 180 days to cure the default, and it specifically warned that failure to cure the breaches set forth in the NOD would result in termination. The NOD outlined the many discussions Nissan had with the dealer over the course of several years regarding its declining sales performance, and it outlined numerous operational deficiencies that contributed to this performance, including lack of an executive manager, poor customer service, failure to market and effectively advertise, failure to maintain inventory, and lack of capitalization. Mr. Adcock, Nissan’s Region Vice President, hoped that issuing the NOD would get the dealership’s attention, notify Mr. Hampton of the seriousness of the situation, and give Hampton time to improve performance. By May 2010, when the NOD was issued, Hampton’s RSE had dropped to 47.3 percent, which ranked 56/58 dealers in the state of Florida. On May 22, 2010, Mr. Hampton contacted Mr. Reese to advise him that he hired Kevin Drye as the general manager of Hampton. He acknowledged that the store had been mismanaged and said that Mr. Drye would be his final attempt and, if it did not work out, he was going to sell the store. Mr. Drye lasted about a month as general manager and was gone by mid-June. On June 24, 2010, the DOM met with Mr. Hampton, as Mr. Drye was gone and the store had no general manager. During this contact, the DOM discussed Hampton’s low RSE and the effect that constant management changes, lack of training, minimal advertising, and other operational problems were having on the dealership. Mr. Hampton acknowledged the issues, but did not outline a plan for improvement. On June 28, 2010, Mr. Reese contacted Mr. Hampton and asked about his plans for a manager at the store since Mr. Drye had left. Mr. Hampton stated that he was bringing over a young, aggressive general manager from his Lafayette Toyota store and Nissan would be seeing good things soon. Following this call, Mr. Hampton did not move a general manager to the Fort Walton Beach store for at least two more months. On August 25, 2010, the AGM and DOM again traveled to Fort Walton Beach to meet with Mr. Hampton and discuss the performance problems at the dealership. The cure period was more than halfway over, and there had been no improvement in the Hampton’s sales performance. The AGM advised Mr. Hampton that the NOD would turn into a notice of termination if there was no improvement. Rather than providing a plan to improve, Mr. Hampton responded by stating that Florida is a dealer-friendly state and that Nissan would not terminate him. He showed no intention of trying to improve and no concern about the NOD cure period. Other than claiming that he had hired yet another new general manager, who had not relocated to Fort Walton Beach, Mr. Hampton outlined no plan to improve. On September 3, 2010, Mr. Reese again contacted Mr. Hampton to discuss the RSE and operational problems at the dealership. Rather than discussing dealership business, Mr. Hampton tried to change the subject to talk about unrelated matters. He also stated that he had purchased 100 used Nissans from an auto auction for the dealership to sell. This was a big concern for Nissan, as it would shift the focus of salespeople to used cars, which would not improve Hampton’s RSE. At the time of this contact, the new manager still had not relocated to Fort Walton, and nobody was on-site managing the store. In September 2010, Hampton’s new manager, Don Moyers, finally relocated to Fort Walton Beach, four months into the NOD period. Mr. Moyers, however, was still responsible for the management of Hampton Toyota in Lafayette, and he bounced back and forth between the two stores for the remainder of the NOD cure period. At the Final Hearing, Mr. Moyers described the state of the dealership when he arrived four months into the cure period. He stated that the dealership was disorganized, there was no accountability, they were not following procedures, they lacked training, they lacked leadership, there were no checks and balances, there were no systems in place for traffic control, and they were not consistently counting customers, or doing follow-up calls. He admitted the dealership was performing poorly in all areas –- sales, service, parts, and finance and insurance (F&I). Despite repeated requests from Nissan for several years, Hampton never provided a plan to improve performance or demonstrated a sense of urgency. Mr. Hampton admits that he never called the Nissan's Regional Vice President, never went to meet with him, never responded to any of the letters Nissan wrote during the NOD period, and never prepared any specific plan to address the deficiencies. In fact, Mr. Hampton did not even tell his manager, Mr. Moyers, that the store had been issued an NOD or that the dealership had a limited cure period to improve its sales performance. Based on the continuing poor performance of the store, its lack of improvement and lack of any commitment to improve, Mr. Adcock began the process for requesting a notice of termination. By early December, the cure period had expired, and there had been no improvement in RSE. The dealership’s RSE had declined from 102.7 percent in 2007 to 66.55 percent in 2008, 56.83 percent in 2009, and 49.73 percent through September 2010. This ranked Hampton 56th of the 58 dealers in Florida. From May 2010 to September 2010, RSE had barely changed, from 47 percent to 49 percent. As of early December, Nissan knew Hampton’s sales numbers for October and November, which were 22 and 13 respectively. This was less than half of what the dealer needed to sell to reach region average, and Nissan knew the RSE had actually declined from September to November. The November RSE data confirmed that sales penetration through November 2010 actually declined to 48.5 percent RSE. On December 7, 2010, Mr. Adcock made the final decision that Hampton's dealership should be terminated and Nissan issued a notice of termination (NOT) to Hampton for unsatisfactory sales performance. At trial, neither party disputed that Hampton’s sales performance was extremely poor. However, each party offered different explanations for this poor performance. Hampton argued that the economy, the real estate bubble, and unemployment in Fort Walton Beach caused its poor sales performance. The evidence does not support this. The RSE calculation takes into account the state of the economy in a particular PMA. If the economy slows for any reason in a PMA, it would affect every brand of vehicle, and the competitive registrations would be lower. This would lower the sales expectation for Hampton, as it is only expected to gain an average share of competitive registrations. The unemployment rate in Fort Walton Beach was far lower than the rest of Florida. If rising unemployment did affect RSE, it would impact other Florida dealers in PMAs with higher unemployment rates to a far greater degree than Hampton, thus improving Hampton’s relative performance. That expectation however, did not happen. The unemployment rate in nearby PMAs was much higher than Fort Walton Beach, yet those dealers exceeded region average RSE. This would not occur if the economy and unemployment rate was the cause of Hampton’s low RSE. Hampton’s arguments regarding economic conditions are further undercut by Mr. Hampton’s own statements. In June 2010, he told Mr. Reese there was a lot of growth in the area because it had not been hit by the oil spill and the military base was expanding. Hampton also blamed its poor performance on a large military population in its PMA and the lack of Nissan military incentives. The evidence does not support this. The military population in Fort Walton Beach declined from 2007 to 2010. If a higher military population was hurting Hampton’s RSE, its performance would have improved during this period, but it declined substantially. In addition, Nissan dealers with the largest military populations in their PMAs on average exceeded 100 percent RSE, including other dealers in the Florida Panhandle. Hampton’s own expert stated that the lack of military incentives probably did not have a big effect on Hampton’s sales performance. He further stated that if lack of military incentives were a problem, it would possibly be something that Hampton would want to discuss with a Nissan representative. Hampton, however, never mentioned to Nissan that lack of military incentives was a problem. Hampton also argued at the final hearing that Hampton had 27 competitors in its PMA, which was too many to reach RSE. The evidence does not support this. Hampton did not explain how it managed to reach 102.7 percent of Region average in 2007 despite having 28 competitors at that time. Hampton’s own expert analysis showed that a dealership with 27 competitors in its PMA should be expected to hit 99.6 percent of average, whereas Hampton reached only 48.5 percent through November 2010. Every other Nissan dealership in the entire state of Florida with 27 or more competitors performed at a higher level than Hampton. Dealerships with a similar number of competitors in the Nissan Southeast Region on average reached 110 percent RSE. Hampton also argued that the PMA was not drawn correctly. Hampton’s expert, however, admitted he had no dispute with how the dealership’s PMA is drawn and that he would draw it the same way. Hampton implied that the 2010 census may change the PMA and argued that if Nissan added a dealer in its PMA, this would reduce its size and increase Hampton’s RSE (assuming its sales do not change). Although Hampton’s PMA was reduced after the 2000 census, this was not because of the census results, but because Nissan limited its PMA to a 25-mile radius. There was no evidence that Hampton’s PMA would be significantly altered by the 2010 census. As with other manufacturers, Nissan assigns a PMA primarily based on proximity to the Nissan dealership, because a customer generally will buy from the most convenient dealer. The actual census tract of the population closest to Hampton is larger than the 25-mile radius assigned to Hampton. Because its PMA is smaller than the census tract of the closest population, Hampton’s RSE is enhanced because Hampton can sell into nearby unassigned areas, but Hampton is not held responsible for the competitive registrations within those unassigned areas. If Hampton’s PMA were constructed on a pure proximity of population to dealership basis, including areas beyond the 25-mile limitation, Hampton’s RSE would be even lower. Although Hampton argued that adding a new dealer would reduce the size of its PMA, it never suggested that Nissan add a new dealer, and its expert denied that another dealer was needed in the PMA. To affirm that the PMA definition had no impact on Hampton’s performance, Nissan’s expert analyzed Hampton based on sales by distance, without regard to PMA boundaries. This confirmed that Hampton’s performance was far below that of other Panhandle dealers. In a 0-4-mile radius, Hampton penetrated the market at 38.3 percent RSE versus 112.8 percent for nearby Nissan dealers. The results were similar at 4-8 miles, 8-12 miles, and beyond, confirming that the PMA definition did not cause Hampton’s poor RSE. Hampton further argued that its sales performance was caused by a lack of available inventory and that it did not receive enough vehicles during the cure period to reach 100 percent RSE. This argument ignores the application of Nissan’s uniform allocation system, Hampton’s long history of declining vehicles and reducing inventory levels, and its ability to obtain additional vehicles by working within the allocation system and taking advantage of supplemental vehicles that were available. Nissan’s allocation system is based on the relative "days’ supply" of each dealer, and it fairly and equitably distributes vehicles to the dealers who need them the most. "Days’ supply" is the industry standard measurement of dealership inventory. A dealer’s days’ supply is the number of days their current inventory would last based on their sales rate. For example, if a dealer sells one car per day (30 per month) and has 60 vehicles in inventory, that dealer would have a 60-days’ supply. If the dealer sells 3 cars per day (90 per month) with the same inventory, the dealer would have only a 20-days’ supply. The system is responsive to a dealer’s sales rate and inventory levels. As a dealer increases its sales rate by selling its inventory faster, this also lowers its days’ supply, allowing the dealer to earn more vehicles. Both Hampton’s owner and general manager admitted that Hampton earned vehicles under the allocation system the same as every other dealer. Mr. Hampton also admitted that other dealers have more inventory because they have a higher sales rate and lower days’ supply. Hampton’s claims of insufficient inventory are undercut by its own actions in the timeframe prior to the NOT. For a period of several years, the dealership declined a substantial number of vehicles that it had been allocated. From April 2007 to November 2010, Hampton declined over 1400 vehicles. Hampton’s practice was to decline the majority of product offered and “dealer trade” for what it needed. This strategy was repeatedly invoked by various managers at the dealership, even though Nissan personnel counseled against it because it limited vehicle availability at the dealership. Mr. Hampton admitted it was his strategy, even in 2010, to intentionally keep a low inventory of only the fastest moving vehicles and to dealer trade for any other vehicles. He testified that he does not care how many vehicles are in inventory, as long as they do not have any aged units. This strategy is reflected in the dealership’s pay plan, which reduces the manager’s pay if he orders inventory that does not sell within 90 days. The financial hold to reduce inventory levels which Mr. Hampton instituted at the dealership in 2008 served as a clear demarcation for the dealership’s inventory levels. Hampton’s inventory levels dropped from 120 vehicles to a range of 60-80 vehicles, and its sales rate was soon cut in half. Hampton does not claim that it lacked inventory overall, but claims only that it did not receive enough of certain “hot models” in late 2010. Hampton’s inventory levels in these “hot models,” however, were consistent with the rest of the Southeast Region. In addition, Hampton’s sales were poor in almost every segment, showing that it was not a lack of certain “hot models” that caused its poor sales performance. For example, although it had access to plenty of Titans, Pathfinders, and Armadas, Hampton penetrated those segments at only 64 percent, 33 percent, and 16 percent of region average, respectively. Nissan personnel explained the allocation system in detail to various managers at Hampton over the years. As Nissan personnel explained, the best way to earn more vehicles under the allocation system is to increase the sales rate by selling the vehicles you have faster. During the cure period from May to November 2010, Hampton was offered 166 vehicles in the allocation system, even though it sold only 123. Thus, its inventory on the ground went up during this time period, although its sales penetration did not change. If Hampton had increased its sales rate during the cure period, it would have earned more vehicles under the allocation system. Hampton also had the opportunity to obtain additional vehicles from the “Pass Two” turndown list. “Pass Two” vehicles are specified and equipped by the region with the most popular equipment to sell quickly. If any dealer in the district declines or fails to affirmatively accept any Pass Two vehicles offered in allocation, the DOM offers these to dealers within his district. During the cure period, the DOM offered Hampton first cut at the entire Pass Two turndown list each month before offering them to any other dealer. When the DOM provided the list (often including over 150 vehicles) to Hampton each month, he either got no response or Hampton accepted only a few vehicles. Hampton also suggested that there was a market issue that affected its sales. Hampton argued that, because the successors to two other terminated dealers (Love Nissan and Classic Nissan) performed poorly after termination, this must mean the problems those dealers and Hampton faced were the result of some unidentified market issue, rather than their own operations. The evidence did not support this. Hampton’s expert admitted that he did not analyze the operations of those other two terminated dealerships, and that he could not tell one way or the other whether the performance at those dealerships was based on operational rather than market issues. After the initial final hearing was completed on February 16, 2012, Hampton argued that incentive variations were an additional cause of its poor performance. As a result of that argument and the granting of a motion on that issue filed by Hampton, the record was reopened and the parties were permitted to obtain additional discovery and present additional evidence on this issue, the findings on which are detailed below. Beginning in May 2009, Nissan began to vary incentives offered on a few specific models depending on where the customer resided. On these few select models, customers residing in Florida were offered more favorable lease incentives, and customers residing in the rest of the Southeast Region were offered more favorable purchase incentives. Hampton argued that it was harmed by the incentive variations because Fort Walton Beach has a lower leasing rate than the State of Florida or the Southeast Region as a whole. Hampton’s expert, however, could not quantify the impact, if any, this had on Hampton Nissan’s sales performance, and he did not analyze any PMA other than Fort Walton Beach. Both sales and leases count as a retail transaction for purposes of calculating sales penetration. It is very common in the automobile industry to vary incentive offers based on customer residency. The mere fact that incentive variances existed does not show a negative impact on Hampton or any other dealer. To determine if there was any impact, it is necessary to analyze the sales and registration data. Prior to mid-2009, the incentive programs for customers located in Florida and in the rest of the Southeast Region were identical. Thus, incentive variations did not trigger Hampton’s sales performance decline, which began in 2007 and declined most dramatically from 2007 to 2008. If incentive variations benefited Florida dealers located in areas where leasing was more prevalent, as Hampton argues, Hampton’s sales performance in 2009 would have declined more when compared to the rest of the state than when compared to the Southeast Region. However, Hampton’s sales performance decline is similar regardless of whether a state or region benchmark is used. Sales penetration can be adjusted to account for the leasing rates in a particular area by separating lease and purchase data and adjusting the expectation accordingly. After adjusting for the lower leasing rates in the Fort Walton Beach PMA, Hampton’s sales penetration during the cure period from June through November 2010, was only 45.9 percent of the region average, showing that low leasing rates in the market had very little impact, if any, on Hampton's sales performance. The incentive variations beginning in mid-2009 impacted only four models –- Sentra, Maxima, Rogue, and Murano. Both before and after the incentive variations began, these models accounted for only 25 percent of Hampton’s sales. If the incentive variations had caused Hampton’s poor performance, its sales decline should have been greater in these models, but Hampton’s sales performance decline was consistent among both impacted and non-impacted models. Hampton’s expert testified that advertising better purchase incentives on one model could bring in customers who ultimately purchase a different model. He did not know, however, if this actually happened, and there is no evidence that Hampton changed their advertising in any way based on the available incentives. On a few other models –- Pathfinder, Armada, Z, and Frontier –- a Florida customer was eligible for the same purchase incentive as a customer in the rest of the Region, but also was eligible for a more beneficial lease incentive than customers in the rest of the Region. Because the incentives offered to Florida customers on both lease and purchase were equal to or better than incentives offered outside Florida, the incentives on these models could not have negatively impacted Hampton or any other dealer in Florida. Although industry lease levels in the Fort Walton Beach PMA were lower than the State of Florida as a whole, leasing was more prevalent in Fort Walton Beach than in the other three West Panhandle PMAs –- Panama City, Pensacola, and Marianna (5.9 percent leasing rate compared to 7.1 percent in Fort Walton Beach). If the incentive variations negatively impacted Florida dealers in low leasing areas, these dealers should perform worse than Hampton after the lease variations began, yet all three exceeded region average sales penetration. If the incentives offered to customers in the Fort Walton Beach PMA were uncompetitive because of low leasing preferences, the brand performance in the PMA would have declined after the incentive variations began. However, the data shows that the Nissan brand actually performed better in the Fort Walton Beach PMA after the incentive variations began. While Nissan brand penetration increased in the PMA, Hampton’s contribution declined, meaning that customers in Hampton's PMA were purchasing (or leasing) Nissan vehicles at higher rates, yet not from the Hampton dealership. This reflects an operational problem at the dealership. Ultimately, the leasing rates for a brand in a particular market are impacted by the methodology and sales processes of the dealer in the market. Hampton’s own expert conceded that advertising, dealer operations, sales strategy, pricing, management, sales staff ability, sales training, and the number of sales people influence both sales performance and whether a customer decides to buy or lease a vehicle. Although industry leasing in the Fort Walton Beach PMA was 7.1 percent, Nissan brand leasing was only 5.9 percent. By comparison, Nissan leasing in the other West Panhandle PMAs was 12 percent, more than double the industry-leasing rate. This reflects a lack of effort by Hampton. According to its financial statements, Hampton made only one Nissan lease from 2006-2010. Had it captured the available lease opportunity at the same rate as other district dealers, it would have made an additional 22 to 45 retail transactions per year. Although not asserted as an excuse for its poor performance, Hampton argued that Nissan acted in bad faith because (1) the termination was secretly based on Hampton’s decision not to enroll in Nissan’s facility program; and (2) Nissan offered to provide financial assistance to a potential buyer of the store. The evidence does not support Hampton’s argument. Nissan’s facility program is similar to those used by other manufacturers, and it is voluntary. Nissan offered the program to Hampton, as it did to its other dealers. Nissan's market study suggested that conversion of Hampton to an image facility devoted exclusively to sales of Nissan products would be successful in Hampton's location. Although Nissan recommended that Hampton consider converting to an imaged facility, it was not required. Although it may have contributed to the poor sales performance, Hampton’s decision to decline participation in the facility program had no bearing on the decision to issue the NOD or NOT. Nissan’s offer to provide financial assistance to a potential buyer of the store also does not evidence any bad faith. Mr. Hampton’s own broker referred the potential buyer to Nissan. Prior to engaging in any substantive discussions with this potential buyer, Nissan personnel obtained Mr. Hampton’s permission. The price Mr. Hampton sought for the dealership was very high, and Nissan offered financial assistance to help bridge the gap. This offer would allow Mr. Hampton to get a higher price for his dealership, and provide Nissan with a proven performer. Reasons for Hampton's Poor Performance Lack of Executive Manager It is critically important for a dealership to have an authorized on-site executive manager to provide leadership and direction. Without this, it is difficult for Nissan’s field team to work with anyone at the dealership to help a dealer improve sales. Mr. Hampton admitted that the number one reason for the poor sales performance at the store was his failure to have qualified management on-site. He admitted that he made all the management-hiring decisions and that Nissan sent him many written notifications about the failure to have qualified management at the store. Management turnover and lack of an executive manager was a continuing problem at Hampton. Hampton had between 10-12 general managers or management candidates from 2006-2010. Even when the dealership had someone serving as general manager, he did not have the authority of an executive manager. Most dealership decisions and functions were run out of Hampton’s headquarters in Lafayette, including accounts payable, parts and service statements, payroll, financial statements, inventory logging, and floorplan redemptions. The team in Lafayette also made the decisions regarding all manager pay plans and most employee pay plans, set the advertising budget, and re- appraised every used vehicle traded in at the dealership. A number of Hampton’s managers expressed frustration over their lack of authority over the dealership operations, with everything being controlled out of Lafayette and their hands being tied regarding advertising, vehicle appraisals, and other day-to- day operational issues. At the Final Hearing, Hampton argued that the lack of an executive manager at the dealership was Nissan’s fault because they did not help Hampton hire a good executive manager. However, Nissan had no system to identify or recommend potential employees for its dealers, who are independent businesses responsible for making their own hiring and firing decisions. Capitalization Mr. Hampton is the 100 percent owner of Hampton Automotive Group and 13 other entities. The Hampton organization pulled significant amounts of money out of the Fort Walton Beach dealership through owner’s salary, institutional advertising (which consisted of “talent fees” paid to Mr. Hampton to star in commercials), outside services, rent, and management fees. In these five categories alone, $6.3 million was pulled out of the dealership’s balance sheet in five years. Hampton argued that the removal of capital was irrelevant because there was money available for the dealership from the Hampton organization. Even if this money was available, it was never invested in the dealership. The financial statements reveal that, because of various “costs” paid to the Hampton organization, the Fort Walton Beach store lost over $1 million per year in 2008 and 2009. In addition, the Fort Walton Beach dealership lost capital by paying off millions of dollars in loans to other Hampton entities in 2008-2010, further lowering its capital levels. These losses and the withdrawal of capital correlate to the declining sales performance at the dealership. In meetings with Nissan, Mr. Hampton stated that he kept the dealership because he personally made $10 million from it in five years. He also stated that owners’ salaries, management fees, institutional advertising, and other entries on the financial statement were “fluff that went directly to him,” and that, although the dealership showed a loss, it provided him with plenty of profit. (c) Advertising In 2006 and 2007, the dealership spent over $1 million on advertising. In 2008, Hampton cut its advertising budget in half, to $526,355. In 2009, Hampton cut its advertising budget in half again, to $242,058. Despite the issuance of an NOD, Hampton’s advertising expenditures remained low in 2010, at $284,430. During this same time period, sales performance steadily declined, from 102.7 percent in 2007 to 67.1 percent in 2008, to 58.4 percent in 2009, to 48.5 percent through November 2010. While the dealership advertising was cut in half in 2008 and again in 2009, the owners’ salary stayed consistent at $480,000. There is a direct correlation between investment in advertising and sales volume. The less a dealership advertises, the less traffic it attracts, and the less it sells. Nissan DOMs noted that advertising was a major problem at the dealership and the limited ad budget hurt the dealership’s sales performance. Even in 2010, Hampton’s managers complained that their “options were limited based on [the] meager advertising budget” and their “hands are tied due to the limit[ed] amount of resources allocated to advertise in the community.” Though advertising had been cut by 75 percent from 2007 levels, Hampton did not increase its advertising budget during the NOD period. Several experts analyzed Hampton’s advertising trend and noticed the same decline on a relative basis that is reflected on an actual basis in the financial statements. On a per-new-unit (vehicle) basis, advertising dropped from an above average $500- $600 per unit in 2006-2008 to 20 percent below average at less than $400 per unit in 2009-2010. Hampton also spent less of its gross profit to advertise than other dealers in the region. Hampton’s advertising per expected sale fell from a high of $620 in 2007 to $263 in 2010. d) Sales Staff From 2007 to 2010, Hampton cut its sales staff in half, from 13 in 2007 to 6 in 2010. Hampton’s general manager testified that, when he arrived in August 2010, they only had seven salespeople, and they needed 10 just based on the traffic they had at that time. The pay plan for managers discouraged hiring salespeople by lowering management pay if salesperson compensation increased. Successful dealers have a trained and certified sales staff, as product knowledge is a key element in selling. Hampton failed to have training programs in place and failed to take advantage of Nissan’s offers of training. Hampton refused to send any of its staff to off-site training offered by Nissan. Hampton’s own manager admitted that sales personnel lacked sufficient training as late as August 2010. Other than in 2007, when Hampton performed at average, the dealership lacked a sales force that was dedicated to the Nissan brand. Having a dedicated sales staff can make a great impact on sales performance, as they have better product knowledge and are vested in the sale of Nissan products. At the Final Hearing, Mr. Hampton testified that one of the reasons Nissan sales suffered is that the sales force focused more on Hyundai sales. (e) Lack of Focus on Sales Performance At the Final Hearing, Mr. Hampton admitted that he was focused on personal profitability rather than sales numbers or adequate representation of the Nissan brand. He testified that he was proud of how the dealership performed in 2007-2010 because it was profitable, despite its poor sales performance. Hampton's pay plan for General Managers was not based on sales performance, but instead on gross profit, even during the NOD period. In addition, salespeople at Hampton are paid based on gross profit, and they had no incentive to focus on a particular brand, even during the NOD period. Hampton did not take advantage of programs and incentives offered to improve sales performance. The dealership never participated in any tactical incentive programs offered by Nissan, which provide employees with trips, cash, and other incentives directly from Nissan to help drive sales. Mr. Hampton advised his staff not to try to hit retro bonuses, which provide a great monetary incentive to make a certain number of sales. He decided that making the sales necessary to hit a retro would just open them up to an audit. Hampton was one of only two or three dealers in the entire region that refused to participate in a truck retro where Nissan offered up to $10,000 in incentives on each Titan sale. Nissan’s Treatment of Other Dealers Section 12(B)(1) of the Dealer Agreement allows Nissan to terminate the Agreement if a dealer fails to substantially fulfill its sales responsibilities. Due to the complexities involved, Nissan evaluates potential dealer terminations on a case-by-case basis. Both Hampton’s expert and Nissan’s expert agreed that it would be unreasonable to apply a bright-line test for termination, because circumstances affecting sales penetration must be considered. Consistent with this opinion, Nissan first considers the dealer’s sales penetration and then reviews any circumstances that might affect sales penetration or warrant delaying the termination. Nissan does not terminate every dealer who falls below 100 percent RSE, because a dealer that is just slightly below average would not considered to be in substantial and material breach of the Dealer Agreement. Nissan’s starting point for considering a sales performance termination is the dealer’s RSE, and those dealers near the bottom of the state in terms of performance may be considered in substantial breach warranting termination. Next, in making the determination of whether to issue a notice of default or termination, Nissan considers the materiality of the RSE deficiency, the ranking among other dealers in the state, the effectiveness and turnover in management, ineffective or insufficient advertising, and other factors that might contribute to the success or failure of a dealer. Nissan also considers whether the dealer has come forth with a meaningful plan to improve and turn things around. Each of these factors is applied consistently and uniformly to any dealer facing potential termination. After considering Hampton’s extremely poor performance, its steady decline in RSE, its long history of management turnover and operational deficiencies that continued during the NOD period, and its lack of a plan or even a willingness to take the steps necessary to improve, Nissan determined it was necessary and appropriate to terminate Hampton. Hampton’s counsel specifically identified three other dealers that he believed must be terminated before Hampton to uniformly apply the grounds for termination: Ocala Nissan, Celebrity Nissan, and Crystal Nissan. Notably, Hampton’s expert report reflects that the PMAs of all three of these dealers performed better than Hampton in Registration Effectiveness, Hampton’s preferred measure of performance. With respect to RSE, Hampton’s expert analysis shows that Ocala Nissan’s average sales performance from 2008-2010 was better than Hampton’s, with an average RSE of 65.8 percent compared to 59.6 percent for Hampton. Like Hampton, Ocala was issued a notice of default. Unlike Hampton, Ocala immediately called the Region Vice President to schedule a meeting after receiving the notice of default, came to the Region office with a plan to provide qualified management at all levels, and implemented a plan to overhaul the dealership operations with a substantial increase in advertising. While any one of these actions alone may not have been enough to delay a notice of termination, the action plan convinced Nissan that the dealer was taking the necessary steps to improve performance, and they delayed the issuance of a notice of termination to provide Ocala with a limited time to implement the plan and improve performance. While not stellar, Ocala’s RSE performance was better than Hampton’s at the time the NOT was issued to Hampton. Celebrity Nissan was a replacement dealer for Classic Nissan, a dealer who was issued a notice of termination, but sold the dealership while appealing the Department’s decision approving the termination. Upon purchasing the dealership, Celebrity had to operate from the same substandard facility as the terminated dealer and had to overcome the prior dealer’s history of poor performance in the market. When Celebrity failed to significantly improve performance at the store, Nissan issued a notice of default. In response, Celebrity notified Nissan that Celebrity was going to sell the dealership and requested Nissan to provide a buyer's assistance letter. Once Celebrity was in active negotiation with the buyer, Nissan saw no benefit in seeking termination and, instead, gave the dealer time to move forward with the sale. The dealer who purchased Celebrity began performing well. Like Celebrity, Crystal Nissan was a replacement for a terminated dealer who sold the dealership while appealing the Department’s decision approving the termination. Crystal had to share a facility with the prior dealer’s Honda store until it could build its own facility. Crystal’s predecessor had been a 20-year poor performer, and Crystal was tasked with essentially creating the market. According to Hampton’s own expert, Crystal’s “average” performance from 2008-2010 was higher than Hampton’s. In addition, Crystal, with an 80 percent RSE at the end of 2009, was performing far better than Hampton and remained over 15 points higher than Hampton at the time the NOT was issued to Hampton in December 2010.
Recommendation Based on 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 dismissing Petitioner’s protest and approving the December 7, 2010, Notice of Termination. DONE AND ENTERED this 12th day of September, 2012, in Tallahassee, Leon County, Florida. S JAMES H. PETERSON, III 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 12th day of September, 2012.
The Issue Whether Respondent violated certain provisions within chapter 520, Florida Statutes (2010),1/ as alleged in Petitioner’s Administrative Complaint; and, if so, what penalty should be imposed.
Findings Of Fact Sam’s Car is a motor vehicle retail installment seller based in Pensacola, Florida, and is governed by chapter 520. Mirza Ahmad is the president and 50-percent owner of Sam’s Car. Between January 7, 2009, and December 31, 2010, Sam’s Car held license number MV0902721 enabling it to conduct business as a motor vehicle retail installment seller. In other words, Sam’s Car could offer financing so that its customers could purchase vehicles through installment payments. At some point in 2010, Mr. Ahmad decided to convert the sole proprietorship named Mirza Aftab Ahmad, d/b/a Sam’s Car, into a corporation named Sohail Enterprises, Inc., d/b/a Sam’s Car. If a sole proprietorship licensed as a motor vehicle retail installment seller wishes to convert to a corporation, the new corporation must file a new application to be licensed as a motor vehicle retail installment seller. Accordingly, Mr. Ahmad filed an application in December of 2010 for a motor vehicle retail installment seller’s license on behalf of Sohail Enterprises, Inc., d/b/a Sam’s Car. Mr. Ahmad did not renew license number MV0902721, and the license went into inactive status on December 31, 2010. Sam’s Car could not enter into retail installment contracts with an inactive license. OFR ultimately issued license number MV9905731 to Sohail Enterprises, Inc., d/b/a Sam’s Car, and that license became effective on March 16, 2011. Sam’s Car never moved to re-activate license number MV0902721, and OFR deemed that license to have retroactively expired on December 31, 2010. Sam’s Car was not licensed to enter retail installment sales contracts between January 1, 2011, and March 15, 2011. OFR licenses motor vehicle retail installment sellers such as Sam’s Car and is responsible for ensuring that licensees comply with chapter 520. OFR may conduct examinations and investigations to determine whether any provision of chapter 520 has been violated. In March of 2014, OFR contacted Mr. Ahmad and notified him that OFR would soon be conducting an on-site examination of Sam’s Car. During an on-site examination, OFR examiners visit a motor vehicle retail installment seller’s office, identify themselves, and examine various records in order to verify that the licensee complied with chapter 520 during the time period in question. OFR examiners arrived at Sam’s Car on March 19, 2014, and spent approximately six hours examining and scanning particular records of Sam’s Car. The examiners began by requesting that the office manager of Sam’s Car provide them with all the motor vehicle installment contracts that Sam’s Car had entered into in 2011 and 2012 (“the examination period”). Some of the requested records were at Mr. Ahmad’s home rather than at Sam’s Car. Accordingly, one of the examiners returned to Sam’s Car on April 9, 2014, to scan those documents after they had been retrieved from Mr. Ahmad’s home. The examiners reviewed 20 to 25 records from Sam’s Car and determined that several of the sales contracts utilized by Sam’s Car were not the form contract that had been approved as an industry standard by the Florida Independent Auto Dealer Association. There was a period of time during the examination period when Sam’s Car was utilizing a sales contract that it had essentially created from scratch. The examiners determined that the sales contracts in question did not have several of the items required by chapter 520. On September 5, 2015, OFR issued an Administrative Complaint alleging that Sam’s Car violated four provisions within chapter 520. In Count I, OFR alleged that Sam’s Car violated section 520.07, Florida Statutes, by failing to ensure that all motor vehicle retail installment contracts executed by Sam’s Car during the examination period satisfied all of the requirements of section 520.07. The contracts reviewed by OFR allegedly failed to contain the “Notice to Buyer,” the “total amount of payments,” and a specific statement that liability coverage is not included. OFR further alleged in Count I that several of the contracts failed to ensure that the contract had been signed by the buyer and the seller. Finally, OFR also alleged in Count I that there were two instances in which Sam’s Car failed to ensure that the contract was completed before it was signed. OFR alleged in Count II that several of the reviewed contracts violated section 520.07(6) by enabling Sam’s Car to collect delinquency/collection charges or late fees in excess of five percent of the installment payment due. In Count III, OFR alleged that Sam’s Car violated section 520.07(3), and Florida Administrative Code Rules 69V- 50.001 and 69V-50.002 because there were instances in which Sam’s Car had failed to document that it refunded or credited title charges collected from the buyer that exceeded the actual charges. Finally, OFR alleged in Count IV that Sam’s Car violated section 520.03(1) by selling motor vehicles on installment payments between January 1, 2011, and March 16, 2011, without an active license. The following findings are based on the documentary evidence and testimony received at the final hearing conducted on March 11, 2016. OFR proved by clear and convincing evidence that the retail installment sales contracts in OFR Exhibits 1 through 20 do not have the notice to buyer required by section 520.07(1)(b). OFR proved by clear and convincing evidence that the retail installment sales contracts in OFR Exhibits 1 through 20 do not have the specific statement about liability insurance coverage required by section 520.07(1)(b). OFR proved by clear and convincing evidence that the retail installment sales contracts in OFR Exhibits 1 through 20 do not set forth the “total of payments” as required by section 520.07(2)(c). OFR proved by clear and convincing evidence that the retail installment sales contracts in OFR Exhibits 6 through 8, 11, and 14 through 18 were not signed by the seller as required by section 520.07(1)(a). OFR proved by clear and convincing evidence that the retail installment sales contracts in OFR Exhibits 18 and 20 were not complete prior to being signed as required by section 520.07(1)(a). In sum, OFR proved all of the allegations in Count I of its Administrative Complaint by clear and convincing evidence. With regard to Count II, OFR proved by the clear and convincing evidence set forth in OFR Exhibits 6, 7, and 21 that Sam’s Car violated section 520.07(6) by collecting a delinquency/collection charge in excess of five percent of each installment. As for Count III, OFR proved by the clear and convincing evidence set forth in OFR Exhibits 1 and 14 that there were two occasions during the examination period when Sam’s Car did not refund the overcharges on the estimated title, tag, and registration fees. Accordingly, OFR proved that Sam’s Car violated rule 69V-50. With regard to Count IV, OFR proved by the clear and convincing evidence set forth in OFR Exhibits 22, through 25 that Sam’s Car violated section 520.03(1), by entering into retail installment contracts with four separate buyers during the period when Sam’s Car did not have a motor vehicle retail installment seller’s license (i.e., January 1, 2011, through March 15, 2011). Even though OFR proved the allegations in its Administrative Complaint by clear and convincing evidence, there was no indication that those responsible for Sam’s Car’s operations intentionally committed the aforementioned violations. Instead, the testimony presented at the final hearing demonstrated that the violations resulted from inadvertence and/or an incomplete understanding of chapter 520’s requirements.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Office of Financial Regulation enter a final order imposing a $1,000 administrative fine on Sohail Enterprises, Inc., d/b/a Sam’s Car. DONE AND ENTERED this 16th day of May, 2016, in Tallahassee, Leon County, Florida. S G. W. CHISENHALL 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 16th day of May, 2016.
The Issue The issue to be determined is whether Respondent committed an unlawful employment practice by discriminating against Petitioner because of her sex and/or age, and/or by retaliating against her for engaging in a protected activity.
Findings Of Fact Petitioner, a female, is a former employee of Respondent. At the time her employment with Respondent was terminated on December 31, 2015, she was 60 years old. Petitioner was a salesperson for Respondent, a company that sells specialty medical devices to medical providers and facilities. Petitioner’s background gave her technical knowledge regarding the cardiac-related product line, as she had obtained a certification as a perfusionist in 1978. A perfusionist operates the heart-lung bypass machine during open-heart surgery. By 1985, Petitioner moved into sales and has focused on cardiac products because of her background. Petitioner began her employment with Arrow, Teleflex’s predecessor, as a salesperson for the cardiac unit in August 2003. At some point, Arrow was acquired by Teleflex; the record is unclear as to exactly when this occurred, but it may have been sometime in late 2007. Petitioner testified that the product line has changed over the years, as there used to be artificial heart-related products, which were her “great loves” (R. Exh. 28 at 44), and why she started working there, but the company got rid of those programs. Under Teleflex, the main big-ticket piece of capital equipment sold by salespersons in the cardiac unit is the intra-aortic balloon pump. In addition, salespersons sell disposable products, such as catheters and cannulas used with the pump, in cardiac surgeries, and catheterization lab procedures. The organization and composition of the cardiac unit’s sales territories and the salespersons assigned to them were subject to change and did change throughout Petitioner’s time with Arrow and then Teleflex. Likewise, the organization and composition of sales divisions/regions and the managers assigned to be in charge of them were subject to change and did change throughout Petitioner’s employment. Sales divisions and sales territories within divisions were created, combined, split up, and reconfigured, and both salespersons and managers were added, eliminated, and reassigned. Petitioner attempted to recount the history of changes in sales territories that affected her during her years at Arrow and then Teleflex.1/ When Petitioner started in 2003, her sales territory was most of the state of Florida up to Tallahassee, and all of the cardiac unit’s sales representatives were under the supervision of a single manager. At some point, separate sales divisions were created, and a new manager was assigned to supervise Petitioner and others in her division. At another point, when a sales associate was let go, Petitioner’s sales territory was expanded to add the Florida panhandle and part of Alabama (to Mobile). At another point, separate sales territories were combined, and the sales associate who covered sales in Georgia and Alabama was let go. At the request of her new manager, Petitioner helped train a new sales associate to cover Georgia and Alabama. Petitioner was successful in sales for Arrow, and received several honors and awards for her achievements. At the end of her first year of employment in 2004, she was honored as “rookie of the year.” She received the chairman’s club award twice, in 2005 and 2007, for ranking in the top 10 percent of sales company-wide. Finally, she received the circle of excellence award in 2007, for having achieved her sales quota numbers three years in a row. Petitioner was promoted to executive sales representative, although she cannot remember exactly when that was. Her sales role was not changed, but she got a pay increase and some increased duties in the area of training new sales associates. When Teleflex acquired Arrow, the sales associate trained by Petitioner for the Georgia-Alabama sales territory was let go. Both Georgia and Alabama were added to Petitioner’s territory. From her home base in Florida (she lived in Spring Hill), she covered the three-state sales territory of Florida, Georgia, and Alabama. Another change affecting Petitioner occurred when the state of Georgia was reassigned to a salesman in North Carolina and Petitioner’s territory was reduced to Alabama and Florida. Later, that salesman was promoted to manager for the eastern division, and Georgia was added back to Petitioner’s sales territory. It is unknown when these changes occurred, but from that point until early 2014, Petitioner’s sales territory remained the three-state area of Florida, Georgia, and Alabama. Somewhere along the line, Petitioner experienced another changeover in management, with Christine Mazurk assuming the position of eastern regional manager. Ms. Mazurk supervised Petitioner from approximately 2010 to 2013. Petitioner was evaluated annually using a standardized format called the performance management process (PMP). The most heavily weighted area in the PMP is the annual formulation of business objectives and target goals, expressed in terms of sales revenue dollars by product line. In addition to business objectives, other categories evaluated include competencies and development. The objectives and target goals are established annually in the first quarter of the calendar year. The process begins with the employee who creates and submits the objectives and goals to his or her manager, who must accept them. At the end of the year, the employee performs a self-evaluation, rating each category as 1 (does not meet), 2 (partially meets), 3 (fully meets), or 4 (exceeds), while the manager similarly rates the employee in each category. The manager’s ratings are used to calculate an overall “final rating.” The final rating scale is as follows: between 1 and 1.4 means “does not meet”; between 1.5 and 2.4 means “partially meets”; between 2.5 and 3.4 means “fully meets”; and between 3.5 and 4 means “exceeds.” In 2011, Petitioner rated herself at 2 for business objectives, which she believed were partially met. She rated her overall performance at 3.0. In contrast, from her manager’s perspective, Petitioner did not meet her business (sales revenue) objectives, achieving only 73 percent of her revenue target for 2011. The manager gave Petitioner the lowest rating of 1 in business objectives, and an overall final rating of 2.4, partially meeting performance expectations. Petitioner added the comment in her PMP that the economy really hurt sales in 2011. Petitioner’s performance was worse in 2012, according to the PMP that she and her manager, Ms. Mazurk, completed. Once again, Petitioner’s self-evaluation was higher than her manager’s. Petitioner’s overall rating for herself was 2.9, but her manager’s overall rating and the final rating on her PMP was 2.0, a little lower than in the prior year in the range of only partially meeting her performance expectations. In this PMP, Petitioner offered the following comment: “Really feel the baseline numbers were off.” At some point in 2012, a business profile of Petitioner was prepared. Although the source of this profile was not entirely clear, Petitioner said that she thought it had been prepared by her manager (who, at the time, was Ms. Mazurk) in connection with a promotion that Petitioner was seeking. The profile reported that Petitioner had been employed at the company for nine years, and gave her sales performance in relation to her target goals for 2008 through 2011. The profile also identified Petitioner’s “developmental needs” in the following three areas: Communication skills (email and verbal with support team) Emotions run high Sales Training Petitioner did not receive the promotion, and continued as an executive sales representative in the sales territory of Florida, Alabama, and Georgia, under Ms. Mazurk’s management. In 2013, Petitioner’s PMP was not completed, apparently because Petitioner was out for two weeks with an injury, and then later in the year was out for two months for a surgical procedure and recovery. In the nine and one-half months that she worked (almost 80 percent of the year), she reportedly achieved sales revenues of 54 percent of her target revenue goal for that year. A reorganization at the end of 2013 resulted in a new manager for Petitioner, James Phillips. Mr. Phillips was the manager for the western North America sales region, but served temporarily as Petitioner’s manager, from January to May 2014, while the company was looking to bring in someone new to manage the eastern region. Mr. Phillips met with Petitioner in the beginning of 2014 to inform her of another realignment of sales territories, which would go into effect in March 2014. Insofar as the changes affected Petitioner, a new sales territory was being created, called the “south Florida” territory, and the company’s plan was to hire a new salesperson for the new territory. More accurately, the newly created sales territory covered more than just south Florida; it included all of the east coast from Jacksonville south, the west coast up to Tampa-Saint Petersburg, and part of central Florida, including Orlando. At the same time, the state of South Carolina would be added to Petitioner’s reconfigured sales territory. The impetus for creating the new south Florida territory was evidence showing that this highly populated market had been underpenetrated. In other words, Petitioner, who had been the area’s sole sales representative for more than 10 years, was not accomplishing the level of sales expected for this market. Accordingly, the business judgment was that splitting up the state and assigning the underpenetrated south Florida market to a new salesperson would promote increased market penetration by making that market the sole focus of the new salesperson.2/ Petitioner disagreed with splitting the state into two territories, but said that she could understand why the company wanted to create a new south Florida sales territory; as she stated, that market is very different from north Florida. However, solely from the perspective of the lost sales opportunities for herself, she voiced her disagreement with the line-drawing for the new territory. In a letter she sent to her new manager, as well as to three members of upper management, she requested that management reconsider how to split the territory within the state of Florida, and asked that she be allowed to retain the Orlando market. Petitioner’s letter also reported that she was “very excited” about the addition of South Carolina to her sales territory. Petitioner’s letter did not result in a reconsideration of the March 2014 territory realignment. Therefore, beginning in March 2014, Petitioner’s sales territory included the Florida west coast, central Florida north of Tampa/St. Petersburg from Ocala north to the state line, and the Florida panhandle, plus all of the states of Alabama, Georgia, and South Carolina. When the decision was made to create a new south Florida territory, a specific salesperson had not been identified for that new territory. Petitioner claims that she asked to be assigned to the new territory, but was refused. No evidence was presented to substantiate her claim; instead, the letter she wrote to her superiors about the realignment only asked that the territories be redrawn so that she could retain the Orlando market, while expressing her enthusiasm about acquiring the state of South Carolina. In May 2014, John Bowman was brought on board for the position of eastern regional manager, covering eastern United States and Canada. He was hired by the president of the company because the eastern region was underperforming. Mr. Bowman was charged with improving the business performance of the sales team so that sales would reach and sustain expected goals, which Mr. Bowman said is his forte. Mr. Bowman is very direct with the sales representatives under his charge. He is results-oriented and does not mince words when it comes to identifying deficient performance and making corrective “suggestions” that may sound more like demands. Thereafter, if he observes a continuation of the performance deficiency he has tried to correct, he is quick to point that out. That is his management style, and why he believes he has been effective in achieving results: “In sales you’re constantly measured by your results. You’re paid on your results. You’re measured on your results. You’re ranked on your results. I am as well and so is my president. And I make that very clear with sale individuals and always have.” (Tr. 138). As part of the management transition, Mr. Phillips provided Mr. Bowman with his assessment of Petitioner as a salesperson. Mr. Phillips had not served as Petitioner’s manager long enough to conduct a formal year-end PMP evaluation, and so the assessment was characterized as a “personal assessment” and was not placed in Petitioner’s personnel file.3/ While both positive and negative qualities were described in the assessment, there was more bad than good; however, Mr. Bowman set the assessment aside so that he could form his own opinions. He considered the points raised by Mr. Phillips as simply identifying some issues that he should look out for. Mr. Bowman was not based in the same city or even the same state as Petitioner. He did not meet with her until after he had been employed as her manager for just over one month. As Petitioner acknowledged, he had much ground to cover, as his region included all of North America east of the Mississippi from Florida up into Canada, and as she put it, “he tried to be fair with everyone.” (Tr. 100). Before Mr. Bowman ever met Petitioner, he fielded complaints from two different customers who called the Teleflex toll-free number to track down Petitioner’s manager. Both complaints were perceived by Mr. Bowman to be communication problems, i.e., the issues would not have arisen if Petitioner had communicated better with the customers. One of the customers complained to Mr. Bowman that Petitioner was “useless in giving us the information we needed.” (R. Exh. 10). Petitioner’s attempted explanation of the two incidents tended to lend credence to Mr. Bowman’s assessment and the customer’s comment. Ultimately, she sought to minimize their significance by characterizing them as only two isolated incidents during her long tenure. However, from Mr. Bowman’s perspective, these were two customer complaints that he had to field in his first month as Petitioner’s manager, unlike what he faced with any other sales representative there. When Mr. Bowman met with Petitioner on July 1, 2014, he talked with her generally about her background and abilities, which he complimented, and he addressed the concerns he had from the two customer complaints. He also identified two other areas where he thought her performance required improvement. In an email sent the following week, he summarized their discussion (including the compliments) and the three areas where he wanted to see her improve. These were: her interaction and communication with customers, evidenced by the two recent incidents requiring him to intercede; her communications with internal Teleflex personnel, where her failure to provide clear, complete, and precise information resulted in “elongated email strings” and confusion; and her too-frequent requests to him for low pricing approval. Petitioner was taken aback by these criticisms, which she took as demeaning and condescending, because she viewed herself as a proven performer who was highly respected. She did not react well to the email summary of these points, which she viewed as a paper trail intended to bring her down.4/ Nonetheless, Mr. Bowman’s points were shown to be valid, and, indeed, consistent with similar comments made by prior managers, including the manager who noted in Petitioner’s profile in 2012 that Petitioner needed to work on her verbal and e-mail communication skills. Mr. Bowman was clear in his meeting with Petitioner, in the e-mail summary of that meeting, in subsequent discussions, and in his testimony at hearing that he fully expected Petitioner to learn from his constructive criticisms and improve her performance. Moreover, he did not view her performance deficiencies as extreme enough to warrant formal action, such as placing her on a performance improvement plan. Instead, he quickly and consistently pointed out to Petitioner each time he saw a continuation of the behavior he had criticized, and he repeated the criticism while noting that he was repeating prior criticism, as was his way. Mr. Bowman testified credibly that he treated all of the sales representatives under his charge the same way, and was consistent in the way he communicated both positive capabilities and performance issues requiring improvement. Petitioner offered no evidence to prove that Mr. Bowman treated her any differently from the way he treated other sales representatives. One of Mr. Bowman’s first tasks as the new eastern region manager was to participate in interviews for a new salesperson to be assigned to the new south Florida territory. After interviews by Mr. Bowman, the president of the company, the director of finance, the director of marketing, and another manager, and after a third-party psychological exam, Eric Patton was hired in August 2014 as a sales representative for the new south Florida territory. At the time he was hired, he was approximately 34 years old. Although the territory changes went into effect in March 2014, Petitioner continued to cover sales in the new south Florida territory, for which she was compensated, until September 2014 when Mr. Patton assumed coverage of the territory. Petitioner was asked to provide Mr. Patton with information on her contacts in the new territory, and she did so. Petitioner also spent several hours with Mr. Patton at her home to demonstrate how she made her sales pitches, and she also gave him a script. Thereafter, she took a couple of day trips with him to introduce him to some customer contact persons in his new territory. These were meet-and-greet sessions only, not extended visits involving actual sales presentations. Petitioner’s view is that it was not fair that she lost the pipeline of sales opportunities in the south Florida territory to Mr. Patton. When it came to losing this, or any, sales territory, Petitioner complained that she was losing out on the “pipeline” of sales opportunities that she had cultivated but not yet closed. However, when Petitioner gained sales territory, she complained about the disadvantage of starting out from scratch in a new area. Neither viewpoint appears to comport with the reality that every time sales territories are changed, the new salesperson has some head start by virtue of the work of the predecessor salesperson. But there was no basis shown for Petitioner’s sense of “entitlement” to the benefits of a sales territory after the territory is assigned to someone else. That is particularly true here, where Petitioner did not refute the legitimate business purpose of an underpenetrated market that led to the territory reconfiguration. The company compensation system for sales representatives was based on revenue recognized from sales, not on unrealized “pipelines” for future business. Petitioner claimed that in one instance, she believes that Mr. Patton was treated more favorably than her while they were both working in sales in their respective territories. Petitioner and several other salespersons (both male and female) had closed some pump sales with contingency clauses written in the contracts whereby the customer would be allowed to return the pump and upgrade to a new model at no additional cost if a new model became available within 18 months after the sale. The company determined that under federal law, the revenue from those sales could not be recognized, but rather, had to be held in escrow until the contingency period had passed. Since sales commissions were paid on the basis of sales revenue recognized by the company, sales commissions were deferred as well. Mr. Bowman explained credibly that these deferred compensation sales had been allowed under a policy in place before he was employed, but that Petitioner’s deferred sale was the last of several allowed before the policy was discontinued. Petitioner testified that Mr. Patton told her that one year after her deferred compensation sale, he made a sale in which he was allowed to offer verbal, but not written, assurance that an upgrade to a new model would be allowed, and his commission was paid on the sale. However, Petitioner offered no non-hearsay evidence to substantiate her description of what she was told, and her description was refuted by Mr. Bowman’s credible testimony. In any event, Petitioner’s unsupported description did not establish two sales that would be considered the same so as to require the same treatment regarding payment of commissions. No finding can be made that Mr. Patton was treated more favorably than Petitioner in this regard, as claimed. Petitioner and Mr. Bowman completed Petitioner’s PMP evaluation for calendar year 2014. The evaluation was similar to those for Petitioner in 2011 and 2012. Petitioner rated her performance either the same or more favorably than her manager did, with the result that her overall final rating was 2.2, compared with her self-evaluation of 2.4. In mid-2015, the company lost a large contract with HPG, which is a large group purchasing organization (GPO)-- probably the largest in the country, according to Petitioner. Instead of contracting again with Teleflex, HPG entered into a sole source contract with Teleflex’s competitor. As Petitioner acknowledged, the recent advent of GPOs had dramatically changed the sales business, because the GPOs control access to potential purchasers. Purchasers using the GPOs are no longer free game for salespersons to explore new sales opportunities. For Teleflex, this meant that as of mid-2015, its salespersons could not solicit new sales from potential purchasers using HPG, because HPG would direct those purchasers to Teleflex’s competitor pursuant to the new sole source contract. As Petitioner acknowledged, the loss of the HPG contract was a substantial loss for Respondent, with the significant impact coming in the loss of growth opportunity to develop new business. In June 2015, the president of the company raised the possibility of a reorganization to consolidate the north Florida and south Florida territories, in light of the loss of the HPG contract. Mr. Bowman began discussions with senior management about possible changes to the sales territories. In late September 2015, Mr. Bowman provided senior management with a Power Point presentation that set forth a proposed reorganization of the southeast. His proposal was to reconfigure the two existing territories, to create a single Florida territory and a separate “Tidewater” territory covering Alabama, Georgia, and South Carolina. As he proposed the reorganization, the two sales representatives--Petitioner and Eric Patton--would cover the two reorganized territories. Meanwhile, Mr. Bowman continued to critique Petitioner’s performance in some fairly strident emails and conversations. In an incident on September 30, 2015, Petitioner submitted a quote request for a new pump for one Baycare hospital, while another Baycare hospital was also considering a new pump. According to Petitioner, the issue was not the price to quote for the new pumps, as she stated that the price had been set and was “already on a contract.” (R. Exh. 28 at 154). Instead, Petitioner said that the issue was whether the hospitals would get a credit for the cost of unusual repairs being made to their existing pumps. In contrast, according to Mr. Bowman, the company had already agreed that the repair costs would be applied to the purchase price, but the issue was what price should be quoted for the new pump, which he said had not been set by any contract. Mr. Bowman found the price requested by Petitioner to be too low, and instead of approving her price request, he sent her an email at 5:35 p.m. on September 30, 2015, questioning her price approval request, while noting the same price would have to be given to both Baycare hospitals. He ended the email as follows: “Call me tomorrow to discuss.” (R. Exh. 14 at 1). Instead of acknowledging Mr. Bowman’s email and waiting to talk to him first, Petitioner sent an email to the customer, with a copy to Mr. Bowman, the next morning. The email apologized for “not getting you the outright purchase quote yesterday,” explaining that the delay was because “[t]he outright quote required management approval[.]” (R. Exh. 14 at 2). After reading his copy of the email, Mr. Bowman called Petitioner and reacted harshly, telling Petitioner that she threw him under the bus by sending the email to the customer without discussing it with him first, and that she had committed a fire- able offense. While harsh, Mr. Bowman’s reaction was not off- base. Petitioner’s email tends to undermine her testimony that the issue was not the purchase price which she claimed was fixed by contract. And while Petitioner testified that she tried to call Mr. Bowman that afternoon or evening before she sent the email the next morning, Petitioner did not mention the email from Mr. Bowman. Surely, when waiting to hear from her manager, she would have read his incoming email before sending the email to the customer. Petitioner failed to explain why she did not follow her manager’s instruction to discuss the matter with him.5/ Following their telephone conversation, Petitioner called the human resources department and spoke with the manager, Jennifer Robichaud, to complain about Mr. Bowman. The essence of her complaint was that at 60 years old and close to retirement, she felt that Mr. Bowman was gunning for her and trying to push her out.6/ She complained about the March 2014 territory realignment, which she though was unfair because a large part of her territory was given to the new sales representative, “a young guy.” She told Ms. Robichaud that she has always been a top performer, and although she recently had not been closing sales on pumps, that was because she was starting from scratch in a new territory. She said that until Mr. Bowman came on board, she never had any issues with her past managers. Although she acknowledged that she and Mr. Bowman have very different styles, she felt that Mr. Bowman did not accept her for who she is. Ms. Robichaud assured Petitioner she would investigate. They spoke on a Thursday; Ms. Robichaud was able to discuss the matter with Mr. Bowman the following Tuesday, October 6, 2015. She relayed Petitioner’s complaints that she felt that Mr. Bowman was trying to push her out, and her feeling that it was unfair to give her pipeline to Mr. Patton. Mr. Bowman denied that he was trying to push Petitioner out of the company, and said, instead, he wants her to succeed. With regard to her perception about pipeline fairness, Mr. Bowman responded that all sales representatives are expected to have a pipeline of business opportunities, but that it is closing the business that matters. In the days thereafter, he sent Ms. Robichaud information pertinent to the investigation, including email communications with Petitioner, the assessment from Petitioner’s prior manager, and information about the customer complaints. Ms. Robichaud also investigated Petitioner’s annual PMP ratings and her performance through September 2015. She also sought and later received the data supporting the decision to realign the Florida territory in 2014. As before, Mr. Bowman continued his practice of addressing Petitioner’s performance on issues that had previously surfaced, which he had previously addressed with Petitioner. Thus, on October 9, 2015, Mr. Bowman criticized Petitioner for her email communications with customer service in which she asked for free replacements of medical supplies to be sent to her home for a customer, without giving sufficient information. The response from the customer service representative stated he was “a bit confused” by the request, and asked for more information: “Donna, your input is appreciated here.” The representative had to ask questions to get the information necessary to handle the request appropriately, such as whether the supplies were being provided for free to respond to a complaint. Mr. Bowman’s criticism was that Petitioner’s email request to customer service was “an example of a lack of professionalism and clarity in your communications. I have addressed this issue with you multiple times over the past year and unfortunately, you have not demonstrated improvement.” (R. Exh. 15). On Monday, October 12, 2015, Petitioner forwarded Mr. Bowman’s email criticism to Ms. Robichaud and asked her to call. They spoke Tuesday morning. Ms. Robichaud told Petitioner that she had been looking into Petitioner’s concerns and had spoken with Mr. Bowman. Ms. Robichaud told Petitioner that Mr. Bowman was not trying to push Petitioner out of the company, but was looking for performance results, and Ms. Robichaud did not find any reason to believe Petitioner was being treated unfairly. Ms. Robichaud said that Petitioner and Mr. Bowman needed to talk, because in Ms. Robichaud’s opinion, the problem appeared to be a clash of styles, which is not uncommon with a change in managers, and that they needed to learn to adapt. Ms. Robichaud talked to Mr. Bowman afterwards. She encouraged him to reach out to Petitioner, hear her concerns, and try to understand her perspective. She reminded him that he has acknowledged that he is very direct, and “perhaps a few small changes in how he communicates with her can have a positive impact.” (R. Exh. 18 at 2). Mr. Bowman contacted Petitioner, and they agreed to meet in person. The meeting took place on October 16, 2015, in Tampa. Before the meeting, Petitioner requested a copy of her personnel file from Ms. Robichaud. Petitioner testified that at the meeting, Mr. Bowman was very civil and respectful to her. He said that he thrives on diversity and enjoys the challenge of working with different kinds of people. He assured her that any decisions that are made are always going to be about performance. Petitioner reacted curiously to this: she testified that she realized that nothing was going to change, while admitting that Mr. Bowman was acting completely differently than he had before. Petitioner said that he was “extremely scripted,” and probably had been coached on what to say by the human resources manager. Yet she also complained, inconsistently, that the human resources department did nothing to help her or to facilitate a meeting with Mr. Bowman. According to Mr. Bowman, Petitioner said that she did not think she would be able to meet the objectives set for her. According to Petitioner, she said that he should just stop (being civil to her), that she knew what he was doing, and knew that he wanted her to go away. Regardless of which lead-in is accurate, Petitioner went on to offer that she would resign her employment at the end of the year if the company paid her the deferred commissions, and her salary and benefits for six months. Mr. Bowman was genuinely surprised by Petitioner’s offer. Shortly after Mr. Bowman’s meeting with Petitioner, Mr. Bowman was informed by his superiors that his proposal to retain but reconfigure two sales territories with two sales representatives in the southeast had been reviewed, but was rejected because it would not be a viable solution to address the loss of the HPG contract. Instead, the decision was made to consolidate the southeastern states--Florida, Georgia, Alabama, and South Carolina--into a single sales territory, covered by one salesperson. Mr. Bowman was told to extract metrics for the time period that Petitioner and Mr. Patton were both working sales in their respective territories, including their recognized sales revenues compared to their quotas, pump sales, and 2014 PMP rating. He was also told to add non-metric qualitative considerations regarding any business practice and customer interaction issues. Mr. Bowman pulled the data, and on October 23, 2015, he provided his superiors with his performance comparison of Mr. Patton and Petitioner. For the period of September through December 2014, Mr. Patton’s first quarter with the company, the quantitative metrics were mixed. Mr. Patton’s overall PMP performance rating of 2.7 was better, falling within the “fully meets expectations” range, whereas Petitioner’s overall rating of 2.2 only partially met her performance expectations. Mr. Patton sold one balloon pump during his first few months with the company. Petitioner was credited with zero sales of balloon pumps during this time, although she noted that she had at least one deferred sale that was not counted during this time. Petitioner achieved 104 percent of her overall sales quota from September to December 2014, although the revenue recognized was from disposables and not pump sales. Mr. Patton achieved 73 percent of his sales quota in his first few months with the company, but that included recognized revenue from a pump sale. For the first three quarters of 2015 (Mr. Bowman was able to extract data through the end of September 2015), the quantitative metrics were decidedly in Mr. Patton’s favor. During this period, Petitioner had zero pump sales, while Mr. Patton had seven pump sales, and Petitioner achieved 83 percent of her sales quota through sales of disposables, whereas Mr. Patton achieved 112 percent of his sales quota, largely from pump sales. On the qualitative considerations, Mr. Bowman summarized the issues he had been addressing with Petitioner in an attempt to bring about improvements, including communication issues with customers and internal personnel, as well as his concerns about her frequent requests for low pricing approval. He also noted a recent situation where Petitioner lost a pump sale to a hospital in Alabama. When he had asked Petitioner why she thought she did not get the sale, she explained to Mr. Bowman that the chief of perfusion “may have felt I was too aggressive,” that Petitioner “felt there was tension between he and I,” and “obviously something happened here.” (R. Exh. 22, last page). Petitioner acknowledged in her deposition that what Mr. Bowman said was true, but that the tension was due to extenuating circumstances. In contrast, for Mr. Patton, Mr. Bowman reported no issues of concern in just over one year of managing him. As Mr. Bowman testified at hearing, Mr. Patton was an excellent sales representative and Mr. Bowman found no performance deficiency issues to address with him. Petitioner offered no evidence to the contrary, stating that she had no knowledge of Mr. Patton’s performance or the quality of his salesmanship. Based on the performance comparison, Mr. Bowman recommended that Mr. Patton should be retained as the salesperson to cover the consolidated southeastern sales territory. Mr. Bowman’s recommendation was reasonable. Mr. Bowman’s recommendation was accepted and the decision made by senior management was to retain Mr. Patton as the salesperson for the consolidated sales territory and to terminate Petitioner’s employment due to elimination of her sales position. Petitioner presented no evidence to refute the reasonableness of Respondent’s business judgment to consolidate sales territories and reduce one sales position after the loss of the HPG contract. Instead, Petitioner only pointed to the suspicious timing of the decision in relation to her complaint to the human resources department about Mr. Bowman.7/ Petitioner does not contend that anyone other than Mr. Bowman himself discriminated against her or retaliated against her. The evidence does not support Petitioner’s claim that Mr. Bowman discriminated against Petitioner on the basis of her age or her sex, nor does the evidence support Petitioner’s claim that Mr. Bowman retaliated against Petitioner because she complained about him to the human resources department. Instead, the evidence established that when Respondent’s diminished business growth prospects caused it to make the reasonable business decision to reduce its sales positions in the southeast states, Petitioner lost out in a fair comparison on the merits of her performance compared to the other salesperson’s performance. Petitioner’s flagging job performance evident from 2011 forward, while not bad enough to warrant immediate action to terminate her, was not good enough to withstand comparative assessment with Mr. Patton. Petitioner’s view that the choice to retain Mr. Patton must have been a pretext for discrimination or retaliation is in keeping with Petitioner’s inflated view of her own performance. At the same time, Petitioner’s view is also an unfair discredit to Mr. Patton, when the unrebutted evidence was that he was an excellent sales representative. Petitioner admitted that she knows nothing about the quality of his sales work or the quantitative achievements he garnered in just over one year with the company. Although findings on the subject of damages are unnecessary in light of the above findings, even if Respondent had been found guilty of unlawful employment practices, the undersigned would have to find that Petitioner failed to prove her actual economic damages that would have been caused by those employment practices. Petitioner did not present proof of her earnings, and offered only limited evidence of her attempts to mitigate damages with other income and efforts to look for a comparable job. Indeed, in Petitioner’s PRO, this shortcoming appears to be admitted because Petitioner requested an opportunity to submit support for damages. Petitioner’s opportunity to present evidence to support her case was at the final hearing before the evidentiary record closed. There was no request for a bifurcated hearing to address liability, followed by a separate evidentiary hearing on damages if needed. Thus, Petitioner had her opportunity, and failed to prove damages.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Commission on Human Relations issue a final order dismissing the Petition for Relief by Petitioner, Donna Earley, against Respondent, Teleflex, Inc. DONE AND ENTERED this 2nd day of March, 2017, in Tallahassee, Leon County, Florida. S ELIZABETH W. MCARTHUR 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 2nd day of March, 2017.
Conclusions This matter came before the Department for entry of a Final Order upon submission of an Order Closing File by William F. Quattlebaum, Administrative Law Judge of the Division of Administrative Hearings, pursuant to Respondent’s request for dismissal, 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 that this case is CLOSED and no license will be issued to TT of Orlando, inc. d/b/a Maserati of Orlando to sell Maserati automobiles manufactured by Maserati (MASE) at 4225 Millenia Boulevard, Orlando, (Orange County), Florida 32839. Filed December 1, 2011 4:03 PM Division of Administrative Hearings DONE AND ORDERED this 36 day of November, 2011, in Tallahassee, Leon [s SandraC. Lambert, Director Division of Motorist Services Department of Highway Safety and Motor Vehicles Neil Kirkman Building Tallahassee, Florida 32399 County, Florida. Filed with the Clerk of the Division of Motorist Services this _20%l>day of November, 2011. NOTICE OF APPETITES =m" 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. SCL:jde Copies furnished: C. Everett Boyd, Esquire Nelson, Mullins, Riley and Scarborough LLP 3600 Maclay Boulevard South, Suite 202 Tallahassee, Florida 32312 Robert Craig Spickard, Esquire Kurkin Forehand Brandes, LLP 900 North Calhoun Street, Suite 1B Tallahassee, Florida 32301 John F. Walsh, Esquire AMSI-Automotive Management Services, Inc. 505 South Flagler Drive, Suite 700 West Palm Beach, Florida 33401 Donald St. Denis, Esquire St. Denis and Davey 1300 Riverplace Boulevard, Suite 101 Jacksonville, Florida 32207 William F. Quattlebaum Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 Nalini Vinayak Dealer License Administrator
The Issue Petitioner's complaint and Petition for relief allege that she was discriminated against due to her handicap of multiple sclerosis when she was terminated by Respondents on March 9, 1990. The issue for disposition is whether that violation of Section 760.10, F.S., occurred, and if so, what relief is appropriate.
Findings Of Fact Leah Swenson-Davis was employed by Respondent, Orlando Partners, as a national sales manager from August 1989, until her termination on March 9, 1990. As sales manager she searched out new business for the hotel, maintained files and obtained repeat business from corporations and other customers. Her salary was $28,000.00 a year. Louis Evans was director of sales, and her supervisor. He hired Ms. Swenson-Davis to book conventions and also hired Barbara Hydechuk and Beth Darkshani as other sales staff. In his opinion Ms. Swenson-Davis was a "pro"; she generated substantial revenue for the hotel and her sales bookings were "much superior" to the other staff. At one point, the three women were promised new office chairs if they could generate 500 room/nights by Friday of the same week. They made their goal, with Ms. Swenson-Davis bringing in 437 out of the total, and the other women bringing in the remainder. In addition to booking hotel rooms, Ms. Swenson-Davis also was effective in selling other hotel services. She generated business from groups who had previously used the hotel but had not been reworked. Her booking packages were very detailed and thorough and she had few cancellations. In February 1990, Barbara Hydechuk was promoted to director of sales, and she took over the responsibility of national sales. Leah Swenson-Davis was hospitalized in February 1990, for what was originally thought to be a stroke. She was then diagnosed as having multiple sclerosis, a disease affecting functions in the nervous system. Hers is not a severe form of the disease and her physician released her to return to work half-time. At the hearing, no signs of illness were evident; that is, she moved and spoke in a perfectly normal manner. When she returned to work, however, Ms. Swenson-Davis was treated "like a leper". Bill Flynn and Barbara Hydechuk made her feel like she would infect them. She was kept at a physical distance. During her absence, Barbara Hydechuk had been promoted. When Ms. Swenson-Davis asked Bill Flynn why she was not informed of the promotion opportunity, he replied that he had worked with Barbara. The work atmosphere, and employees' attitudes toward Ms. Swenson-Davis were very different after her return to work. On March 9, 1990, the Friday before Ms. Swenson-Davis was to pick up her doctor's release to return to work full-time, she was informed by Barbara Hydechuk that she was "terminated immediately" due to lack of productivity in the sales department. Since her termination, Ms. Swenson-Davis has submitted approximately 300 applications with other hotels, and in other sales and marketing areas. She has been given interviews, but has not been hired as of the date of the hearing, although she is capable of working full-time. She received unemployment compensation from March until September 1990. She has accrued medical expenses in the amount of $12,602.00, in 1992, for herself and her son, which expenses would have been covered by her former employer's benefit package. She was insured through COBRA until December 1990, when the premiums went over $500.00 and she could no longer afford them.
Recommendation Based on the foregoing, it is, hereby, RECOMMENDED: That the Florida Commission on Human Relations enter its final order requiring 1) Reinstatement of Petitioner in the same or equivalent position, 2) damages of back pay computed at the rate of $28,000.00 per year from the time of discharge until reinstatement or rejection of an offer of equivalent employment, less payments received for unemployment compensation; 3) damages in the amount of $12,602.00, representing medical benefits lost; and 4) reasonable costs and attorneys fees. DONE AND RECOMMENDED this 14th day of January, 1993, in Tallahassee, Leon County, Florida. MARY CLARK 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 14th day of January, 1993. APPENDIX TO RECOMMENDED ORDER, CASE NO. 92-3920 The following constitute specific rulings on the findings of fact submitted by Petitioner: 1. Adopted in paragraph 1. 2.-3. Adopted in paragraphs 2, 3, and 4. 4. Rejected as irrelevant. 5.-6. Adopted in paragraph 6. 7. Adopted in paragraphs 2, 5, and 7. Rejected as contrary to the evidence. Petitioner asked why she was not told of the promotion opportunity. Adopted in paragraph 7. Adopted in paragraph 5. 11.-12. Adopted in paragraph 8. Rejected in part. The complaint in this case relates to wrongful termination, not failure to promote. Moreover, no competent evidence supports a finding that Petitioner would have applied for promotion or was denied promotion on account of her handicap. The other employee was promoted prior to Petitioner's return to work. Adopted in paragraph 9. Rejected as unsupported by the evidence. Basis for the computation is not apparent. Rejected as immaterial. Adopted in substance in paragraph 9, although the $200.00 expense incurred in 2/90 is rejected, as petitioner was still employed at that time. Rejected as unsupported by competent evidence. Rejected as unnecessary, although the recommendation for reinstatement is adopted. COPIES FURNISHED: James A. Kirkland Kirkland Management, Inc. 946 North Mills Avenue Orlando, Florida 32802 Percy Bell K. F. International Host, Inc. 1600 Lee Road Winter Park, Florida 32790 Raymond Rotella Kosto & Rotella, P.A. Post Ofice Box 113 Orlando, Florida 32802 Orlando Partners, Inc. d/b/a Quality Hotel Orlando Airport 3835 McCoy Road Orlando, Florida 32812-4199 Tobe Lev, Esquire Post Office Box 2231 Orlando, Florida 32802 Betsy Kushner, Claim Representative Cigna Property and Casualty Companies Post Office Box 30389 Tampa, Florida 33630-3389 Margaret Jones, Clerk Human Relations Commission Building F, Suite 240 325 John Knox Road Tallahassee, Florida 32303-4113 Dana Baird, General Counsel Human Relations Commission Building F, Suite 240 325 John Knox Road Tallahassee, Florida 32303-4113
The Issue Whether Respondent, the University of Florida, discriminated against Petitioner, Tracey Krefting, previously known as Tracey Hardin, on the basis of a handicap as alleged in the Petition for Relief filed by Petitioner.
Findings Of Fact The Parties. The Petitioner, Tracey Krefting, formerly known as Tracey Hardin, is a handicapped individual. She suffers from seizure disorder. Ms. Krefting graduated from the University of Florida in May of 1990. She received a bachelor of science degree with a major in advertising. Ms. Krefting had experience as an advertising sales representative prior to her employment by the Respondent. The Respondent, the University of Florida (hereinafter referred to as the "University"), is a State university located in Gainesville, Florida. Within the College of Journalism and Communications of the University is a radio station, WRUF. WRUF was an auxiliary operation of the University responsible for raising revenue to fund all of its expenses, including the salaries for its sales representatives. No state funding was received directly or indirectly from the University by WRUF. Ms. Krefting's Employment by the University. Ms. Krefting was employed by the University at WRUF on July 28, 1992. Ms. Krefting was employed as "OPS", other personnel services. Ms. Krefting was employed to act as one of six or seven sales representatives of WRUF. As of January 29, 1993, Robert Clark was the General Manager of WRUF. Mr. Clark was Ms. Krefting's supervisor from January 29, 1993 until her termination from employment. Sales Representative Qualifications. The essential function of sales representatives for WRUF was to sell radio time for advertising. This function was an essential function because the revenue necessary to operate WRUF was generated in this manner. Sales representatives were responsible for servicing existing clients and for finding new clients. An essential requirement of the sales representatives of WRUF, including Ms. Krefting, was the ability to travel to the businesses and offices of WRUF's advertising clients and prospective clients. Sales representatives were generally required to spend 80 percent of their working hours out of the office servicing clients and seeking new clients. Continuous contact and an ongoing relationship with clients was required. Contacts with clients were expected to be face to face and not just over the telephone. In addition to being required to make regular contacts with clients, sales representatives were also required to make themselves available to visit their clients with little notice. Obtaining new clients usually required more than one contact with a prospective client by a sales representative. The sales representative was required to sell himself or herself and the station and must gain the trust of the prospective client. Sales representatives were also responsible for performing public service work. This work entailed the providing of public service announcements. The public service work performed by sales representatives did not directly generate revenue for WRUF. Neither the application for employment completed by Ms. Krefting when she was initially employed at WRUF nor the University's OPS personnel requisition form authorizing her employment included any of the necessary skills or qualifications for the sales representative position she was hired to fill. Ms. Krefting was aware at the time she was hired, however, that she would be required to travel to her clients locations and to the locations of prospective clients. There are other means of transportation available which would have allowed Ms. Krefting to reach clients and prospective clients: vehicle driven by a hired driver, public transportation, taxi, and walking. The evidence failed to prove, however, that there were any reasonable means of transportation available to Ms. Krefting other than driving herself which would have allowed her to meet the requirements of a sales representative for WRUF. Ms. Krefting's Handicap. On April 18, 1993, Ms. Krefting fell while rollerskating. Ms. Krefting hit her head on the ground when she fell. On April 19, 1993, Ms. Krefting was admitted to the emergency room of the North Florida Regional Medical Center. The evidence failed to prove that the injury she suffered on April 18, 1993, caused Ms. Krefting to suffer any seizure. On May 6, 1993, Ms. Krefting suffered a seizure while leaving her home to go to work. Ms. Krefting was ultimately diagnosed as having "seizure disorder." At all times relevant to this proceeding, Ms. Krefting suffered from a "handicap." Ms. Krefting's Inability to Drive. On or about May 18, 1993, Ms. Krefting provided a letter from George Feussner, M.D., dated May 18, 1993, to Mr. Clark. In the letter Dr. Feussner indicated that Ms. Krefting was able to return to work but that she could "not operate a motor vehicle " Although Dr. Feussner did not indicate how low Ms. Krefting would be unable to drive, Ms. Krefting informed Mr. Clark that Dr. Feussner had informed her that she would not be able to drive until she was seizure free for one year from the date of her last epileptic seizure, May 6, 1993. As a result of the restriction on Ms. Krefting's ability to drive and based upon Florida law, Rules 15A-5.003 and 15A-5.004, Florida Administrative Code, Ms. Krefting was unable to drive herself to see existing or prospective clients until at least May 6, 1994. Ms. Krefting discussed with Mr. Clark the possibility of hiring a "tenant" of hers to drive her around. Ms. Krefting did not identify the "tenant." Nor did Ms. Krefting inform Mr. Clark that she had completed making arrangements with anyone to drive her. Mr. Clark did not preclude Ms. Krefting from making arrangements to have someone provide transportation for her. Mr. Clark did tell Ms. Krefting that it would have to be determined what implications, if any, a driver would have on WRUF's workers compensation coverage. The resolution of this issue was to be delayed, however, until Ms. Krefting made concrete arrangements for a driver and discussed those arrangements with Mr. Clark. Ms. Krefting failed to finalize any arrangement for a driver. Had Ms. Krefting provided her own driver, at her own expense, Ms. Krefting may have been able to meet the requirement of her position that she be able to provide her own transportation. Ms. Krefting, however, did not take the necessary steps to hire a driver prior to her termination from employment. Ms. Krefting talked to her tenant, Kenneth Vest, about acting as her driver. Mr. Vest worked in the same building that Ms. Krefting did. Mr. Vest worked Sunday through Wednesday from 3:30 p.m. to 1:30 a.m. He was, therefore, generally available for part, but not all, of Ms. Krefting's working hours. Mr. Vest was generally willing to drive Ms. Krefting, if he were compensated. Ms. Krefting did not discuss with Mr. Vest the exact hours that he would be expected to drive her or her schedule. Nor did Ms. Krefting discuss compensation with Mr. Vest. Ms. Krefting failed to prove that Mr. Vest or any other individual was available at any time relevant to this proceeding, or at the final hearing, to provide transportation for her in a manner that would fulfill her responsibilities as a sales representative. Because of the restriction on Ms. Krefting's ability to drive and her failure to make alternative arrangements to have someone like Mr. Vest drive her, Ms. Krefting failed to prove that she met all the qualifications of her position with WRUF. Ms. Krefting did not meet all the qualifications of her position. But for her handicap, however, Ms. Krefting would have met all of the qualifications of a sales representative. The University's Decision to Terminate Ms. Krefting's Employment. On or about May 24, 1993, Mr. Clark informed Ms. Krefting that WRUF could not continue to employ her because of her inability to drive. Ms. Krefting suggested alternative means of meeting her responsibilities with Mr. Clark when she was informed that WRUF would not be able to continue her employment. Mr. Clark considered the suggestions, but did not accept any of them. On June 16, 1993 Mr. Clark agreed to extend Ms. Krefting's termination date to accommodate her efforts to find another postition within the University. Ms. Krefting was ultimately terminated from employment in early July of 1993. Ms. Krefting was terminated because she was prohibited from driving her vehicle and there was no other reasonable means of meeting her responsibilities to service clients and prospective clients. The University's Inability to Accommodate Ms. Krefting's Inability to Drive. During 1993, the financial condition of WRUF was precarious. WRUF was operating at a loss. Three employees had been terminated and a department had been eliminated. Another vacant position had not been filled. WRUF was forced to borrow funds from the University and a foundation account in order to continue operating. At all times relevant to this proceeding, WRUF was unable to create a newly funded position or to allow a sales representative to fail to generate reasonably expected revenues. Ms. Krefting suggested several possible alternatives to accommodate her inability to meet her requirement that she be able to drive. The suggestions were discussed with, and considered by, Mr. Clark. One suggestion Ms. Krefting made to Mr. Clark was to create a new position. The position would entail performing all of the public service work of the sales representatives. Mr. Clark rejected this proposal because it entailed the creation of a new position. The creation of a new position was not a reasonable accommodation. The creation of a new position, especially one that did not generate revenue, would have created a financial hardship on WRUF. The evidence also failed to prove that the public service work could be performed without the need for travel. A second suggestion Ms. Krefting made to Mr. Clark was to restructure her position so that she would be responsible for the preparing of proposals, filing, handling incoming sales calls and telemarketing. In effect, this suggestion also entailed the creation of a new position. This suggestion was rejected by Mr. Clark. Ms. Krefting's second suggestion was not a reasonable accommodation. It would have created an undue financial hardship on WRUF because there was not sufficient work to justify such a position. A third suggestion made by Ms. Krefting to Mr. Clark was that she be teamed with another sales representative who would do all the driving. Mr. Clark rejected this suggestion. Ms. Krefting's third suggestion was not a reasonable accommodation. Teaming two sales representatives would have reduced the effectiveness of two sales representatives who would be available to visit different clients and prospective clients at the same time if they were not teamed. This would have created an undue financial hardship on WRUF. A fourth suggestion made by Ms. Krefting to Mr. Clark was that she use public transportation and taxis. Mr. Clark rejected this suggestion. Although it is questionably whether Ms. Krefting's fourth suggestion constitutes an accommodation, to the extent that it does, it was not a reasonable accommodation. Public transportation does not provide the flexibility required of sales representatives because of the inadequacy of routes and schedules of available transportation. A fifth suggestion made by Ms. Krefting to Mr. Clark was that she provide her own driver. It is questionable whether the use of a driver, as suggested by Ms. Krefting, constitutes an accommodation. To the extent that Ms. Krefting was suggesting that WRUF provide her a driver, her suggestion was not a reasonable accommodation. If WRUF had been required to provide the driver, it would have caused an undue hardship on WRUF. Finally, Ms. Krefting suggested that a student intern from the University's College of Journalism be assigned to work with her and that the intern provide the driving required by her position. Mr. Clark rejected this suggestion. Ms. Krefting had discussed the idea of using an intern with Dr. Joseph Pisani, the Chair of the Advertising Department of the College of Journalism. Although Dr. Pisani was not opposed to the use of an intern-if the intern was properly used-he was opposed to the use of an intern primarily or exclusively as a driver. The suggestion that interns be used was not a reasonable accommodation. Student interns usually are only available to work as an intern for a maximum of 12 hours a week. Additionally, the 12 hours a week that an intern would be available depends upon their class schedule. Therefore, student interns would not be available for a sufficient period of time for Ms. Krefting to fulfill the responsibilities of her position. Although it is not impossible to find a student that would be willing to act as an intern full-time, the evidence failed to prove that it was likely that a student could be found that would be willing to take no classes for up a year or that it would be financially feasible for a student to do so. Mr. Clark did not actually attempt to implement any of Ms. Krefting's proposals. Mr. Clark also did not "consult with any experts" about the proposed accommodations. Mr. Clark's failure to attempt to implement any of the proposals or to consult with experts was not, however, necessary. The issue confronting Mr. Clark was not one involving a decision which required special knowledge or understanding of Ms. Krefting's handicap, or the needs of persons who suffer from seizure disorder. The only issue confronting Mr. Clark was how to accommodate the inability of a sales representative to transport herself to meet the needs of clients and prospective clients. Mr. Clark had all the necessary information to decide how to deal with this issue: Ms. Krefting, regardless of her condition or needs, was prohibited from driving an automobile for at least a year. Mr. Clark was fully aware of the impact of this restriction on WRUF and the resulting inability of a sales representative to carry out their responsibilities. The suggested accommodations made by Ms. Krefting also required no special knowledge or understanding. The suggestions only required an understanding of the needs of WRUF and what was expected of sales representatives. Ms. Krefting's Loss of Income. Subsequent to her termination by WRUF Ms. Krefting remained unemployed until February of 1994. After her termination by WRUF Ms. Krefting received unemployment benefits of approximately $3,500.00 Ms. Krefting earned $800.00 for part-time employment in March of 1994. Ms. Krefting was unable to work from April of 1994 until June of 1994. Ms. Krefting is currently employed. Ms. Krefting's Complaint. Ms. Krefting filed a Charge of Discrimination with the Commission on or about August 18, 1993 alleging that the University had discriminated against her on the basis of her handicap. On or about January 21, 1994, the Commission entered a Notice of Determination: No Cause, finding no reasonable cause to believe that an unlawful employment practice had occurred. On or about February 17, 1994, Ms. Krefting filed a Petition for Relief contesting the Commission's determination. The Petition was filed with the Division of Administrative Hearings. Conclusion. The evidence in this case failed to prove that the University terminated Ms. Krefting's employment because of her disability. Ms. Krefting was terminated by the University because she could not meet all of the requirements of her position. The evidence failed to prove that the University could reasonably accommodate Ms. Krefting's inability to drive without undue hardship to WRUF's activities. Ms. Krefting failed to prove that the University discriminated against her on the basis of her handicap.
The Issue The issue in this case is whether Petitioner's real estate broker's license application should be approved or denied.
Findings Of Fact Petitioner, Rhonda S. Dietz, is a 36-year-old woman who currently holds a real estate sales associate's license. She was first licensed by the State of Florida in December 2001 and has held her license in good standing since that time. At the time Petitioner obtained her sales associate license, she disclosed in her application that she had a criminal background. That background included two grand larcenies, possession of a controlled substance, failure to appear, violation of probation, and obtaining property with a worthless check. Each of the offenses will be further discussed below. Despite the criminal history, Respondent approved Petitioner's sales associate's license, and Petitioner has been selling real estate for the past six years. In 2006, Petitioner first applied for a real estate broker's license. Petitioner maintains that in her 2006 application, she disclosed each of the aforementioned events in her criminal history.1 Nonetheless, her application was denied. In May 2007, Petitioner again filed an application for a real estate broker's license. That application clearly contained documentary evidence of her entire criminal history. The events in that history are hereby discussed: The first grand larceny in Petitioner's background was related to the purchase of goods from a K-Mart in 1994 with a bad check belonging to a roommate. Upon discovering the check was bad, Petitioner immediately turned herself in, made restitution, and paid court costs. She was sentenced to five years' probation for that charge. The second grand larceny involved allegations in 1994 by Petitioner's then-current roommates that Petitioner stole property from them when she moved out of the residence. Although Petitioner denied the charge because the claim was merely retaliation by her roommates for moving out, she agreed to a plea bargain at the advice of counsel. Again, she was given five years' probation and made to pay restitution. In 1998, Petitioner was charged with possession of a controlled substance: a vial of testosterone and some pain pills. She explained that these drugs came from a pharmacy where she was working. The pharmacy specialized in treatment of AIDS patients. She had the drugs in her possession so she could turn them over to a medical group that could disperse them to AIDS patients. The pharmacy supported Petitioner and paid for her defense against the possession charge. Petitioner was sentenced to 24 months' probation, court costs, and 50 hours of community service for that charge. Petitioner also had a probation violation in 1998 for failing to appear and for failing to pay a fine related to one of the aforementioned charges. She did not pay the fine due to lack of funds. She failed to appear due to lack of notice. She was placed on ten months' house arrest for the violation of probation. Petitioner met all other conditions of her probation and has not had any criminal activity since the charges listed above. She does not deny the existence of her prior criminal history and has not attempted to hide it from Respondent. When Petitioner applied for a broker's license in 2005, she filed an application that included her criminal history. The application disclosed all of the charges addressed above. Respondent confirmed the charges by referring to a Florida Department of Law Enforcement (FDLE) report. When Petitioner re-applied in 2007, she personally obtained a FDLE report on her criminal background, which she submitted along with her application. Again, she listed all of her prior history in the application. There is no competent evidence to suggest otherwise. Since the time of her last criminal charge, Petitioner has been gainfully employed. She has worked in an office doing medical billing, in a pharmacy, and as a real estate agent. In her current position, she has been entrusted with large sums of money for clients. She has had no adverse employment actions taken against her. Her co-workers state that she has good moral character and is trustworthy. Petitioner has passed the classroom work needed to become a broker; her application for licensure will complete that process. Meanwhile, she continues to sell real estate and is involved in an investor monitoring program. The broker's license will simply allow Petitioner to make a career move by expanding her capabilities in the area of real estate sales. Respondent did not call any witnesses at the final hearing and did not refute or rebut the facts as stated by Petitioner.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by the Florida Real Estate Commission granting Petitioner's application for a real estate broker's license. DONE AND ENTERED this 17th day of October, 2007, in Tallahassee, Leon County, Florida. S R. BRUCE MCKIBBEN 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 17th day of October, 2007.
Findings Of Fact On March 19, 1985 petitioner, Michael Scott Symons, became employed as a financial manager with the brokerage firm of Easter Guthmann & Kramer Securities, Inc. (EGK) at 7200 West Camino Real Street, Suite 200, Boca Raton, Florida. In connection with his employment Symons filed an application for registration as an associated person of EGK with respondent, Department of Banking & Finance, Division of Securities (Division). The application was received by the Division on or about March 19, 1985 and was deemed to be complete on April 18, 1985. On that portion of the application entitled "Personal History" Symons gave 5700 Grillet Place, S.W., Fort Myers, Florida 33907 as his home address. He identified EGK's address as being 7200 West Camino Real, Suite 200, Boca Raton, Florida 33433. Although Symons signed the application he stated that EGK had actually submitted the application on his behalf since it was a common practice for brokerage firms to do administrative work on behalf of their employees. This is consistent with an agency rule (3E-600.02(3), F.A.C.) which requires that a securities dealer file and countersign the application for registration on behalf of an associated person. On March 24, 1985, or shortly after he began employment with EGK, Symons moved into an apartment at 6091 Boca Colony Drive, Boca Raton, Florida 33427. Approximately one month later, he began renting Post Office Box 3299 in Boca Raton. Symons did not inform the Division of these changes in address, or otherwise amend his application. On or about July 12, 1985 a Division bureau chief spoke by telephone with the chief financial officer of EGK and asked if EGK would voluntarily withdraw Symons' application. Later that same day, an EGK vice-president telephoned the bureau chief and advised him the firm would not withdraw the application. On July 16, 1985, the Division prepared and dated an Order Denying Application for Registration as an Associated Person. The next day a Division attorney sent a copy by certified mail to Symons' at 5700 Grillett Place, S.W., Fort Myers, Florida. Because Symons' wife had previously provided the post office with a change of address form the envelope containing the order was forwarded from Fort Myers to Post Office Box 3229 in Boca Raton. Certified mail notices were thereafter placed in the box on July 24 and July 31. However, the mail was never claimed. On August 8, 1985 the envelope was returned to the Division. It was received in Tallahassee on August 12, 1985. There is no evidence that Symons was aware the order had been mailed or that he deliberately failed to claim the letter. The agency attorney similarly assumed that Symons had not received a copy. Accordingly, it is found that at this point in time Symon had no knowledge that the July 16 order-was entered, and had been mailed to him in Fort Myers and Boca Raton. On August 19, 1985 the Division attorney again sent a copy of the July 16 order by certified mail to 7200 West Camino Real, Suite 200, Boca Raton. This was the address of EGK. According to the attorney, it was her intention to mail the order to Symons, and not his employer. The order contained the following pertinent language on page 5: Respondent is advised that Respondent may request a hearing to be conducted in accordance with the provisions of Section 120.57, Florida Statutes. A request for such hearing must comply with the provisions of Rule 28-5.201, Florida Administrative Code, and must be filed within twenty-one (21) days after receipt of this order. Otherwise, Respondent will be deemed to have waived all rights to such hearing. The certified mail receipt for the envelope containing the order was apparently signed for by Charlie Shields, an EGK employee. 1/ It eventually reached the desk of EGK's chief financial officer, James Weber, in an unopened envelope on August 23, 1985. Weber opened the envelope and read the enclosed order. He noticed on page five of the order that there was a twenty-one day time frame in which an appeal of the agency denial could be made. Believing that the twenty-one day time frame began on July 16, Weber erroneously concluded that the time to request a hearing had already expired. This was probably because he had never before seen a denial order, and was not familiar with the procedures under Chapter 120, F.S. Weber then showed the order to Edward Guthmann, a principal and vice- president of EGK. Guthmann telephoned an out- of-state attorney seeking advice on how to proceed, and sent a copy of the order to the attorney on August 23. The attorney did not take any action, and returned the order to Guthmann on an undisclosed dated between late August and the middle of September. On September 17 Weber "came to the realization" that under any interpretation of the order the time frame in which to request a hearing had run. He then contacted petitioner's present counsel on September 17 to discuss obtaining legal representation for Symons. Symons has continued using that counsel since that time. A petition for hearing was eventually filed with respondent on October 1, 1985. This petition was denied by agency order entered on October 16, 1985 on the ground Symons had "constructive receipt and notice of the Denial Order at the time of its delivery by U.S. Certified Mail to Respondent's personal address on July 24 1985, and furthermore, deems Respondent to have received actual notice. . . on August 25, 1985, when the Denial Order was claimed and signed for at EGK's address as listed on the application." Neither Weber or Guthmann informed Symons prior to September 15 that they had received the Division order, or that the document even existed. They also did not advise him that they had contacted an out-of-state attorney in August in an effort to obtain advice. In this regard, petitioner had not authorized them to take any action with respect to the denial order, or to seek the advice of an attorney. Symons was unaware of the existence of the denial order prior to September 20, 1985 when he was shown a copy of the order by his employer. Had he been aware of the order prior to September 15, he would have filed a request for a hearing. Even though he did not specifically voice an objection to his employer opening his mail, Symons did not expressly authorize his employer to accept the order or any other notices from respondent. Indeed, Symons considered certified mail to be "a personal thing," and something that "an employer has (no) right to open."
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be entered finding that petitioner timely requested an administrative hearing to contest respondent's denial of his application for registration as an associated person. DONE and ORDERED this 4th day of December, 1986 in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 4th day of December, 1986.
Conclusions This matter came before the Department for entry of a Final Order upon submission of an Order Closing File by Lynne A. Quimby-Pennock, Administrative Law Judge of the Division of Administrative Hearings, pursuant to Respondent’s Withdrawal of Notice and Motion to Dismiss as Moot, 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 that this case is CLOSED and no license will be issued to Subaru of America, Inc. and Boyland Auto Center, LLC d/b/a Subaru of South Orlando for the sale of Subaru vehicles (SUBA) at 9576 South Orange Blossom Trail, Orlando (Orange County), Florida 32837. Filed March 28, 2012 7:52 AM Division of Administrative Hearings DONE AND ORDERED this a | day of March, 2012, in Tallahassee, Leon County, Florida. v Lrloen Julie Baker, Chief Bureau of Issuance Oversight Division of Motorist Services Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A338 Tallahassee, Florida 32399 Filed in the official records of the Division of Motorist Services this_4_ day of March, 2012. ok Nalini Vinayak, Dealer Hicense 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. JB/jde Copies furnished: J. Andrew Bertron, ESquire Nelson, Mullins, Riley and Scarborough, LLP 3600 Maclay Boulevard South, Suite 202 Tallahassee, Florida 32312 Kenneth G. Turkel, Esquire Bajo, Cuva, Cohen and Turkel, P.A. 100 North Tampa Street, Suite 1900 Tampa, Florida 33602 Hayden P. Ridore, Esquire Invictus Law Group, P.L. Post Office Box 2209 Orlando, Florida 32802 Dylan M. Snyder, ESquire Dylan Snyder, P.A. 201 North Franklin Street, Suite 2880 Tampa, Florida 33602 Lynne A. Quimby-Pennock Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 Nalini Vinayak Dealer License Administrator
