Shelby American Inc. has been hit with a lawsuit alleging the company deliberately violated a retail sales agreement with Stephen Becker Automotive Group, a Suwanee, Ga., dealership group.
The suit, filed in Los Angeles Superior Court on Friday, alleges that Shelby American began to sell cars directly to the public in December 2014.
Direct public sales violate a dealer agreement Becker’s Planet Shelby Cobra in Sugar Hill, Ga., had with the automaker that required any sales leads be referred to authorized dealerships such as Planet Shelby, according to the lawsuit.
The suit also claims Shelby American “failed to allocate its 2015 Anniversary vehicles to the independent dealerships ... as required by California law,” and violated California and Nevada statutes against unfair competition.
Shelby American, of Las Vegas, Nev., is a subsidiary of the publicly traded Carroll Shelby International, of Gardena, Calif., which makes performance vehicles and parts.
In the suit, Stephen Becker Automotive is seeking unspecified damages for loss of investment, interest, business goodwill and profits. The suit also seeks unspecified punitive damages, alleging that Shelby American intentionally violated its dealer agreement in order to injure Stephen Becker Automotive’s business.
Joe Conway, co-CEO of Carroll Shelby International, said the company does not comment on active litigation.
Attorney Michael Brewer, who filed the lawsuit on Becker’s behalf, was in court and could not be reached for additional comment.
This isn’t the first time Stephen Becker Automotive has sued Shelby American. The company filed a suit in 2012, alleging that Shelby had failed to deliver a number of vehicles ordered, had raised prices on cars and took retaliatory measures against Stephen Becker Automotive when the price increase was challenged.
That suit was settled out of court for an undisclosed sum.