BIRMINGHAM, Ala. (CN) – A Suzuki dealer who once held the top sales spot in the country claims that American Suzuki Motor Corp.’s practice of making its dealers record phantom car sales and accept “unwanted and unpopular” cars ruined his three franchises.
In his federal complaint, Gary Linam says corporate headquarters ruined his Huntsville Suzuki, Shoals Suzuki and Varsity Suzuki dealerships. He says corporate “crippled” his business though a plan to generate bogus sales so its management could get incentive bonuses for hitting benchmarks.
As an example, Linam claims his district manager called him at home late one evening and him to go back to work and enter fictitious sales before an incentive program expired. He says he was subjected to this practice for three years and had to absorb the “sold” vehicles into his car rental business.
Adding insult to injury, Linam says Suzuki tried to terminate their dealer agreement by accusing him of “falsely and intentionally” reporting dozens of vehicles as sold. Linam says corporate executives were aware of the scheme, including its Vice President of Automotive Operations, Koichi Suzuki.
Due to the amount of unsold inventory on his lots, the floor plan lender out a financial hold on his dealerships, so he could not buy any new inventory, Linam says. The final straw came when corporate forced him to take “unwanted and unpopular” cars, Linam says.
Linam says he had to close all three of his dealerships, and though he still provided service and warranty work, corporate headquarters made it impossible for him to continue doing even that, when it awarded dealer services to a competitor in his market area.
Linam seeks punitive damages for RICO violations, violation of the Alabama Motor vehicle Franchise Act, and negligence.
In March this year, Linam’s dealerships were named in a class action breach of contract lawsuit filed by customers who were unable to receive warranty services in the Huntsville area.
Linam is represented by Thomas E. Baddley Jr.