DETROIT -- Toyota Motor Sales sued Group 1 Automotive to block the Houston dealership chain's plans to acquire Lexus and Toyota stores in Charleston, S.C.
Group 1 Automotive Inc. said Wednesday it plans to challenge the lawsuit filed late Tuesday by Toyota in U.S. District Court in Charleston.
In its suit, Toyota Motor Sales says it did not consent to Group 1's desire to acquire Gene Reed Toyota/Scion and Gene Reed Lexus dealerships in Charleston, based on the dealership framework agreement between the two companies.
Gene Reed announced plans in early June to sell the two stores -- pending completion of a final purchase agreement.
Details of the framework agreement -- standard documents between major dealer holding companies and automakers -- have not been disclosed.
Toyota's suit is seeking a court order to prevent the acquisition of the dealerships.
“Based on its 12-year relationship with Toyota and its longstanding commitment to the brand, Group 1 management believes that the claims set forth in the lawsuit are baseless and hopes for a speedy resolution of this dispute,” Group 1 said in a statement.
Toyota spokeswoman Celeste Migliore said in an e-mail that Toyota does not comment on pending litigation nor does it speculate on the outcome.
“For more than a decade, our company has been committed to Toyota,” Peter DeLongchamps, Group 1's vice president of manufacturer relations, said in a statement. “We have or will invest more than $140 million in land, building and facility improvements and are the third-largest Toyota retailer in the nation.”
Group 1 said its Toyota business has improved 21 percent in 2010, nearly double Toyota's sales performance nationwide.
“Despite our efforts to remedy this issue with Toyota directly, they have chosen to pursue legal action against one of their most vocal allies and top-performing dealership owners,” DeLongchamps said. “We are perplexed and disappointed by the action they have taken.”