Dealer Group Accuses Maserati of Inflating Sales Numbers
September 03, 2015
NEW YORK — A dealer group has filed a $200 million lawsuit against Maserati North America (MNA), claiming the OEM launched discriminatory dealer incentive programs in order to present “an image of greater value of financial strength” prior to the initial public offering of its parent company, Fiat Chrysler Automobiles.
Filed on Aug. 28 by Recovery Racing — which operates a chain of Maserati dealerships in New York, New Jersey and Florida — the lawsuit alleges that MNA launched in 2014 an illegal vehicle-punching scheme that rewarded complicit dealerships with incentives and reduced expenses.
Recovery Racing owner Stuart Hayim, who is being represented by Leonard Bellavia and Steven Blatt of law firm Bellavia Blatt & Crossett, alleged that dealers were instructed by MNA’s Regional Sales Vice President Rick Fuller to “punch” — or record the sale of — new 2015 Ghibli vehicles before the cars were even delivered to their dealerships.
“Those dealers that were complicit with this fraudulent scheme received hundreds of thousands of dollars in incentive monies,” the complaint read, in part.
The scheme resulted in MNA reporting a 300% increase in retail sales in October 2014, according to the lawsuit, despite hundreds of those vehicles not having been sold to retail customers.
Dealers who participated in the scheme were rewarded through “discriminatory” dealer incentive programs, according to the suit. If they met the OEM’s monthly sales objectives, those dealers would receive retroactive incentive payments for each vehicle sold, essentially allowing them to purchase and sell new Maserati vehicles at substantially lower prices than their competitors.
And while the sales goals set for Recovery Racing were at five to seven times the number of Maserati vehicles it had historically sold, “other, newer, Maserati dealerships (with no substantive sales history) received more favorable pricing through the bonus program,” according to the complaint, because their sales objectives were based on their lower market share and short sales history and therefore more reasonable. Those dealers were effectively able to undercut other Maserati dealers — including Recovery Racing — with no impact to their bottom line, the lawsuit charged.
MNA also allegedly told dealers that it would cease to reimburse them for the “holdback” fees they were charged in addition to the wholesale price of a vehicle if that vehicle was sold outside the dealership’s territory.
“In addition … MNA advised certain of the then operating plaintiffs, without justification or cause, that certain of their dealership territories would be reduced, thereby further reducing the territories in which they could sell new Maserati vehicles and be paid holdback monies,” the lawsuit stated.
MNA had not returned requests for comment at the time of publication.