When Ford Motor Co. named Bernie Woods to run a Ford dealership in Louisiana in 2001, Woods assumed he was the dealer.
Not so, Ford says. Woods was president and general manager of Southpoint Ford in Stonewall, La. - but not the dealer, Ford argues.
Litigation involving Ford and Woods turns on this dispute over titles. So does Ford's effort to force Woods to accept arbitration of his challenge to Ford's decision to remove him from the dealership last July.
Woods wants to sue Ford over his termination. He says federal and state "dealer day in court" laws allow him to do so. The Louisiana Motor Vehicle Commission agrees.
In a federal lawsuit, though, Ford argues that Woods cannot invoke those laws because he was never the dealer. And under the dealer development program that placed Woods in the store, Ford says, Woods signed an arbitration agreement that covers the dispute.
A federal judge agreed with Ford last December. Woods is appealing that ruling to the 5th U.S. Circuit Court of Appeals in New Orleans.
Ford will not say why it terminated Woods. Woods says Ford forced him into a failing dealership with scant prospects for revival. He says he lost $285,000 he had invested in the store.
Woods says his name was on the dealership's license. If he was not the dealer, Woods argues, Ford used him as a front to own and operate the store. Louisiana law prohibits automakers from owning dealerships permanently.
Woods, who is black, insists that Ford treated him and other minority entrepreneurs in the development program as dealers.
"We're not shareholders," he says. "We're sharecroppers."
Woods says Ford wants to keep him from pursuing a lawsuit that would reveal the company's poor management of the dealer development program. Ford would not discuss Woods' allegations. In a statement, Ford calls the dealerships involved in its development program "individual legal entities" controlled by a board of directors. Woods says the three board members at his dealership were Ford employees.
Ford says it typically owns 90 percent of the shares of such stores and the "dealer development operator" the rest. Ford's lawsuit says Ford paid Woods $120,000 a year to run the dealership.
The suit also argues that the development contract Woods signed was not a franchise agreement, which would have declared him a dealer. As a result, Ford says, the contract's arbitration clause "is valid and binding."
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