A court has ruled that dealer Bernie Moreno can open a new Infiniti store in Coral Gables, Fla., ending a long bid by South Motors Infiniti of Palmetto Bay, Fla., to block it.
In a lawsuit filed against Nissan North America, South Motors argued that Nissan's deal with Moreno -- giving him millions in cash for an Infiniti dealership -- violated state franchise laws.
On Nov. 17, Florida's 1st District Court of Appeals, in a one-word opinion, upheld a lower court's ruling that approved Nissan's awarding the open point to Moreno.
"That was pretty good news," Moreno told Automotive News. "I love one-word decisions. It just read, "Affirmed.'"
Moreno, who has been building Infiniti of Coral Gables during the litigation process, said it will open Dec. 26.
The decision isn't expected to affect another case involving two Cleveland-area dealers who filed a federal lawsuit against Nissan North America, alleging its alliances with so-called "preferred dealers" such as Moreno amount to illegal incentive programs that violate U.S. and Ohio laws.
Nissan has been remaking its dealer network, sparking discontent among some of its dealers.
Responding to a query, Nissan North America said, "Infiniti is pleased with the Florida District Court of Appeals ruling approving the establishment of a new Infiniti dealership in the Coral Gables, Fla., market. There has been a substantial need in this market for some time and Infiniti looks forward to provide a superior experience to our customers with a new state of the art dealership in downtown Coral Gables."
South Motors Infiniti of Palmetto Bay, about 15 miles south of Miami, had argued that Nissan must offer other Florida dealers the same cash deal that the automaker is giving Moreno. Anything less violates Florida franchise law, the appeal said.
Under that deal, Nissan will give Moreno as much as $4.4 million. Moreno will get $200,000 when the dealership opens and an additional $120,000 per quarter for up to seven years if he meets steadily rising sales goals, according to the 2014 agreement. The deal also includes $1 million for store improvements.
The appeal sought to overturn a lower-court ruling by the state of Florida's Division of Administrative Hearings that approved Nissan's awarding an open Infiniti point to Moreno.
The lawyer for South Motors, John Forehand, declined to comment to Automotive News beyond saying, "We're evaluating our next steps."
Moreno, 49, owns Bernie Moreno Cos., of Cleveland, Ohio. His 11 dealerships sell 20 brands. His annual new- and used-vehicle retail sales are 18,000 vehicles, he said.
Moreno said the Nov. 17 ruling "should put an end to it. They could appeal to the Supreme Court of Florida, but that won't change our plans anyway."
His plans include hiring 70 people to staff the 75,000-square-foot store he has built on the ground floor of the opulent Bacardi USA headquarters in Coral Gables. Coral Gables is a suburb about five miles south of Miami.
Most of the $4.4 million package that was agreed upon for the new store has "gotten eaten away" just to get him to the point of opening the dealership, he said.
"In Florida, you cannot file to be a dealer of an open point unless you control the real estate," Moreno said. As a result, Moreno said, he has leased the store's property since early 2013, paying about $115,000 a month to hold it until 2015. That's when he started construction despite the unresolved legal battle.
"So when you look at it saying, "Infiniti gave you all that money,' there was a giant cost because it sat vacant all that time," Moreno said.
"If it wasn't for the lawsuit we would have opened two or three years ago."
The additional Infiniti presence in the Miami area will benefit other Infiniti dealers nearby such as South Motors and Warren Henry Infiniti in Miami, Moreno said. "I am hoping that South Motors does well," Moreno said. "We hope to have a good relationship with them and that everyone can enjoy success."
