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Representative Cases

Dealer Gets Court Order Preventing Bank From Terminating Floor Plan

A floor plan lending institution threatened to terminate its floor plan relationship with an automobile dealership client. The basis upon which the floor plan lender sought to terminate the relationship was not necessarily due to any allegation that the dealership was “out of trust.” 

Rather, the floor planer sought to terminate the floor plan relationship based upon allegations of fraud.

After our automobile dealer client received notice of the lender’s intention to terminate financing, we immediately sought a temporary restraining order and preliminary injunction to compel the floor plan lender to continue to finance the purchase of automobiles pending the Court’s ultimate determination of the facts in the case. 

Essentially, our law firm argued on behalf of our client that the floor plan lender was unfairly accusing the dealership of fraud and that the lender had no basis to terminate the floor plan financing. 

Our law firm was successful in obtaining the temporary restraining order and preliminary injunction thereby compelling the floor plan lender to continue financing of the acquisition of automobiles pending ultimate determination by the Court.

Dealer Successfully Challenges Relocation of Neighboring Dealer

One of our dealer clients was faced with an impending manufacturer authorized relocation of a neighboring dealer’s service department. The proposed relocation would have allowed the neighboring dealer to relocate its service department within our client’s Area of Responsibility. If not stopped, the relocation would result in unfair competition and a significant diminution of our client’s service and sales business.

Once our client confirmed the manufacturer’s intention to proceed with and permit the neighboring dealer to relocate its service facility, this law firm drafted an Order to Show Cause to seek a temporary restraining order and preliminary injunction prohibiting the relocation. 

The legal papers demonstrated that, absent relief by the Court, our client would be irreparably harmed. The legal papers were served upon the manufacturer. Ultimately, upon receipt of the papers, the manufacturer rescinded its approval of the relocation of the neighboring dealer and our client’s area of responsibility remained undisturbed.

Junior Partners Sue Dealer Principal Shareholder Dispute

Our firm was retained by two minority shareholders of a closely held automobile dealership corporation. The minority shareholders accused the majority shareholder of wasting corporate assets and failure to pay the minority shareholders their pro rata share of the profits of the automobile dealership. Pursuant to the express terms of the Shareholders Agreement however, the shareholders were not allowed to commence litigation seeking a dissolution of the corporation. Rather, the Shareholders Agreement provided solely for arbitration.

The minority shareholders believed that any undue delay in proceeding with the dissolution of the corporation would result in a further decrease in the value of the dealership. As such, our law firm suggested that the minority shareholders seek a temporary restraining order and preliminary injunction against the majority shareholder pending the arbitration process. 

By seeking this temporary relief and preliminary injunction, it would allow the minority shareholders the right to go into Court (as opposed to arbitration) in an effort to obtain an Order from a judge prohibiting the majority shareholder from taking any actions to the detriment of the minority shareholders.

Ultimately, our law firm was successful in obtaining a temporary restraining order and preliminary injunction which prohibited the majority shareholder from taking any actions outside the ordinary course of business without the express consent of the Court.

By obtaining this Order, we were successful in assuring that the value of the dealership remained in tact pending completion of the arbitration process.

Buyer Forces Seller to Close Under Buy/Sell Agreement

Our law firm was retained by the proposed purchaser of an automobile dealership who was concerned that the seller of the dealership was attempting to delay closing. 

As our client wished to assure his ability to acquire the dealership and compel a fast closing, our law firm filed an Order to Show Cause to compel the selling dealership, pursuant to CPLR §6301, at et seq. and certain specific provisions of the buy/sell agreement, to proceed with the closing of the sale of the dealership assets on or before a date certain.

Essentially, it was our client’s position that the selling dealership was intentionally delaying the closing of the transaction so that he may have the benefit of the strong selling season. 

Obviously, our client also wanted to get the benefit of the strong selling season and, as such, sought to compel the sale pursuant to the express terms of the buy/sell agreement. 

Ultimately, after service of the Order to Show Cause upon the selling dealership, the matter was settled and our client was able to proceed with the acquisition of the dealership in a timely fashion.

Rejected Chrysler Dealers V. US Government

The Fifth Amendment of the US Constitution protects against the taking of private property for the public good without just compensation. 

All rejected Chrysler dealers, even those who settled with Chrysler, may be eligible to join this ground breaking case.

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