Proposed Franchise Termination: A manufacturer cannot terminate a new motor vehicle Dealer franchise without first providing the Dealer notice of its right to file a Protest with the New Motor Vehicle Board (“Board”). In any termination Protest proceeding the manufacturer bears the burden of establishing “good cause” to proceed with the proposed termination. It is critical to have counsel with extensive experience in litigation before the Board.
Proposed Establishment of New Dealers: A manufacturer cannot establish an additional same line make Dealer within ten miles of any existing same line make Dealer without first giving the required written notice advising affected Dealers of their right to file a Protest with the New Motor Vehicle Board.
Proposed Relocations: A manufacturer cannot relocate an existing same line make Dealer to within ten miles of an existing same line make Dealer without first providing notice to these Dealers of their right to file a Protest against the proposed relocation.
Warranty and Incentive Chargebacks: California law places certain restrictions on a manufacturer’s ability to conduct audits and its ability to chargeback Dealers for warranty and incentive payments received. A Dealer may file a Protest with the New Motor Vehicle Board against unreasonable audits and chargebacks.
Export Penalties: Dealers may also file Protests against the unreasonable assessment of penalties against Dealers in instances where a vehicle was sold to a customer who subsequently exported the vehicle to a foreign country. Under California law there is a rebuttal presumption that the Dealer did not intend for the vehicle to be exported so long as the vehicle was registered at the time of sale and sales tax was collected.