DETROIT -- Ford Motor Co. has filed a federal lawsuit against embattled car dealer Denny Hecker, alleging Heckers now-closed Ford-Lincoln-Mercury store in Stillwater, Minn., owes the car company more than $3.1 million.
The Ford lawsuit, filed Monday, Jan. 12, is the latest bomb to drop on the megadealers crumbling empire. The first dropped in October when Chrysler Financial Services cut off floorplanning for nine of the 16 dealerships Hecker owned at the time.
The Ford lawsuit, filed in the U.S. District Court of Minnesota, contends Stillwater Ford-Lincoln-Mercury owes Ford $95,054.48 for four new vehicles intended for retail sales and $2,219,786.20 for 80 vehicles intended for fleet customers. The suit also says the dealership owes $830,524 for parts.
The suit claims it first notified the dealership Nov. 13 that it was in breach of contract and demanded either the money or the return of the vehicles. There has been no reply.
Were a privately held company and dont comment on any litigation, Hecker told Automotive News during a brief telephone conversation yesterday.
Hecker closed six of his dealerships, including Stillwater Ford, on Nov. 21 and sold three others. Those stores, including several non-Chrysler brands, were financed by Chrysler Financial.
The captive pulled the plug on the stores financing Oct. 15, one day after it demanded $20 million in payments from Hecker.
Then on Nov. 7, Chrysler Financial cut off credit lines for Heckers leasing and car rental businesses.
On Nov. 13, Hecker sued Chrysler Financial in U.S. District Court, alleging the credit line was cut off without warning.
Chrysler Financial spokeswoman Amber Gowen said the company has not filed a response to the Hecker lawsuit and has no comment.
Hecker, 56, is well-known in Minnesota. He still owns seven dealerships: three Hyundai stores, two Toyota, one Chevrolet and one Cadillac-Pontiac-GMC. In December, Hecker filed for Chapter 11 bankruptcy protection for his Advantage Rent A Car company in San Antonio.
In the suit, Ford says it thinks Stillwater Ford will be unable to pay damages because the dealership has closed. The automaker is seeking a temporary restraining order to prevent Stillwater from disposing of any Ford vehicles that may remain at the site.
Ford also wants the sheriff to seize whatever Ford property may be at the dealership.