Judge sides with Tesla, slams Missouri dealership association

Since Tesla began selling electric cars directly to customers across the United States, the electric vehicle maker has had to play franchise law in several state courts.

Tesla won a decisive victory on Tuesday when the Missouri Court of Appeals overturned a lower court ruling that would have left Tesla without a state dealer license.

In the court ruling, the judge criticized the tactics of the Missouri Auto Dealers Association, Tesla’s opponent.

DON’T MISS: Tesla can still sell cars in Missouri stores, pending appeal, after dealership lobby hails victory

According to St. Louis Post-Expedition, the move allows Tesla to continue to operate its University City and Kansas City stores in the state.

Chief Justice Mark Pfeiffer not only spoke in favor of Tesla, but made sure MADA knew why.

“Until the legislature expands its current restrictions on judicial review over ministry authorization decisions, this is the forum for the political process – where complainants have historically shown political might -” [in] which the content of the licensing arguments of this lawsuit against the ministry must be assessed, ”Judge Pfeiffer wrote in the decision.

2017 Tesla Model 3, 2017 Los Angeles Auto Show

However, MADA says it will “continue to explore available legal avenues” to revoke manufacturers’ franchise licenses.

Meanwhile, Tesla is, as you might expect, happy with the decision.

“Today’s decision is a victory for consumers in Missouri who want the choice to discover and purchase their Tesla in their home country,” Tesla said in a statement.

READ MORE: Are Missouri Electric Car Charging Stations Like Pay Phones? Why it matters

“We have served clients in Missouri for almost five years and have contributed to the state’s economy and employment for Missourians, which will now continue.”

The decision is the latest in a three-year feud between Tesla and the dealership association, which represents more than 300 new car and truck dealers in the state.

In May 2014, Missouri state lawmakers attempted to pass a law making the Tesla sales model illegal by adding a last-minute amendment to a bill pending in the dying days of a legislative session. .

Tesla Los Angeles Store [photo: Misha Bruk / MBH Architects]

Tesla Los Angeles Store [photo: Misha Bruk / MBH Architects]

One of the main proponents of the measure, Senator Mike Kehoe, previously owned a car dealership and had received “in-kind” campaign contributions of $ 3,300 from MADA the previous year.

In total, MADA spent around $ 49,000 on meals and entertainment for state lawmakers between 2011 and 2014, when the bill was drafted.

The bill passed the Senate without debate, but was not passed by the House. Tesla called the move at the time a “sneak attack”.

CHECK OUT: Tesla wins Michigan court battle to get emails from lobbyist and lawmaker

In the absence of legislation, MADA sued the Missouri Department of Revenue in January 2015 for issuing a dealer license to Tesla.

The group argued that Tesla’s license violated a state law that required manufacturers to sell vehicles through dealerships with valid franchise agreements.

While Tesla was not a party to the case, the automaker asked a judge in February 2015 for leave to intervene in the proceedings, arguing that the defendant did not represent Tesla’s interests.

Tesla Los Angeles Store [photo: Misha Bruk / MBH Architects]

Tesla Los Angeles Store [photo: Misha Bruk / MBH Architects]

The court rendered its decision in the case in August 2015, almost a year and a half later, finding in MADA’s favor that Tesla’s license to sell vehicles in the state should not be renewed.

Tesla appealed the ruling and was granted permission to continue operating in the state while the next phase of legal arguments went to court.

Tesla’s latest victory will likely free up resources as it fights legal battles in other states, particularly Michigan, where Tesla is engaged in a protracted battle with the state itself, and not just an association. of dealers.

[hat tip: Lanny Hartmann]


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