As a Lincoln-Mercury dealer in New Jersey in the 1990s, Robert Robertazzi successfully sued Ford Motor Co. over payment for warranty work. That landmark case helped make New Jersey one of the first states to put teeth in laws requiring dealer reimbursement at retail rates for warranty-related parts and labor.
Robertazzi, now 82 and retired, says he persisted through years of litigation even after other dealers told him he was "stupid" to pick a long, expensive legal fight with the factory. Robertazzi was dealer principal of the former Liberty Lincoln-Mercury in Clifton, which closed in 2012.
"I was my own deep pockets," he told Fixed Ops Journal.
Jim Appleton, president of the New Jersey Coalition of Automotive Retailers, calls Robertazzi and his wife, Elaine, "courageous" for filing the warranty reimbursement suit against Ford in 1992.
After Robertazzi's first lawsuit was dismissed in 1994, he filed a second suit the following year. Ford eventually agreed to pay Robertazzi retail rates for warranty parts and labor -- but at the same time charged him more for vehicles.
A federal court ruled in Robertazzi's favor in 1996, saying Ford had conducted a "shell game." But the victory was not total, as the court denied a motion to turn the suit into a class action on behalf of all New Jersey Ford and Lincoln-Mercury dealers.
New Jersey's law requiring automakers to pay retail rates for warranty work dated to 1977, but it was routinely ignored, Appleton says. After Robertazzi first sued Ford, it took about eight years to get the law amended so that other dealers in the state could more easily apply for retail reimbursement, he adds.
"There's fear of retribution" from automakers, said an Ohio dealership executive. Last fall, Ohio enacted a wide-ranging update to its franchise law that includes a stronger mandate for retail reimbursement for warranty work.
"There are so many ways [automakers] can retaliate if they want to," said the executive, who asked not to be identified. "We want to get what we're entitled to by law -- no more, no less. But we still have to be partners."
The new Ohio law says automakers may not retaliate against a dealership for seeking retail reimbursement. But it places the burden of proof on a dealer to show that retaliation is tied to a demand for retail pay, based on "a preponderance of the evidence."
Mike Volkman is CEO of Service Department Solutions, a vendor that handles paperwork for dealers who pursue warranty reimbursement at retail rates. He acknowledged that some automakers can be sticklers in demanding documentation for repayment bills.
But Volkman doesn't think overt retaliation is a problem. "I haven't seen any dealer be retaliated upon yet," he said.