A Rhode Island Pontiac dealership is appealing the dismissal of its breach-of-contract and bad-faith suit against General Motors for allowing a competitor just across the state border to relocate.
Bob Lallier, president of County Motors Inc. in Pawtucket, said he is appealing rulings by U.S. District Judge Ernest Torres. Before the trial, Torres dismissed claims alleging breach of the GM-dealer agreement and violation of the Rhode Island dealer law. During the trial, he dismissed the remaining bad-faith claim, Lallier said.
In 1999, GM approved a relocation request by Lance Inc., a Buick-Pontiac-Cadillac dealership in nearby Attleboro, Mass., about seven miles from County Motors. Lance received approval to operate from its satellite location close to County Motors while building a new store about 11/2 miles from County Motors but still in Massachusetts.
GM spokesman Jay Cooney said, 'We received a relocation request from a dealer, and we didn't say no.'
Cooney said it is a standard contract dispute involving 'straightforward contractual principles etched in stone for decades. What was unusual is that it crossed state lines.'
County Motors initially protested to the Rhode Island Motor Vehicle Dealer's License and Hearing Board, which rejected the protest because it lacks jurisdiction over out-of-state dealerships.
County Motors then sued GM in U.S. District Court in Providence.
Judge Torres found no grounds for County Motors' dealer law claim, ruling that the competition-related provision of the Rhode Island law applies only if a manufacturer competes with a dealer. In this case, it said, Lance 'is operated by an independent party,' not by GM.
He also said the dealership agreement gives GM 'sole discretion' to approve the relocation of existing dealerships within County Motors' Area of Primary Responsibility, and County Motors' consent or approval isn't required.
The case now goes to the 1st U.S. Circuit Court of Appeals.
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