Dealer Sues Over Lexus Point Lost in 1989

WICHITA, Kan. — Former Toyota dealer Mike Steven and dealer group CFO Harold Johnson have filed a lawsuit against Toyota Motor Sales USA, seeking more than $120 million in damages under the federal Automobile Dealers Day in Court Act, The Wichita Eagle reports.

The pair allege Toyota and Lexus executives unlawfully conspired to deny the Steven Automotive Group one of 121 charter Lexus franchises in 1989, resulting in $108 million in estimated lost earnings, plus interest and legal fees.

Steven owned a Wichita, Kan., Toyota dealership from 1970 to 2016. In the lawsuit, he claims it was among the factory’s top-performing franchises and that he was promised Wichita’s Lexus point more than once, acquired property to house it, and was “devastated” to learn it was awarded to the competing Wittman-Gorges Auto Group, which was not a Toyota franchisee.

When he contacted J. David Illingsworth, then vice president and general manager of the Lexus brand, Steven says Illingsworth “tacitly threatened” Steven’s Toyota franchise, effectively persuading Steven to defer litigation. Later, he claims, he learned a Cessna executive who launched Toyota’s jet aircraft division influenced the point assignment in exchange for a stake in the new business.

Wittman and Gorges Lexus would later be sold to Scholfield Auto Group, which was also listed as a competitor for the franchise in court documents. The point is now owned by Walser Automotive Group, which is not party to the lawsuit.

In a statement emailed to the Eagle, a Toyota spokeswoman wrote, “We believe these claims related to events that allegedly occurred nearly 30 years ago are completely meritless and have no basis in the law.”

Earlier this month, an Orange County, Calif., jury awarded $15.8 million to another dealer, Roger Hogan, who claimed Toyota withheld inventory in retaliation for Hogan’s advocacy for more effective safety recalls.

To read the Wichita Eagle article, click here.

Originally posted on Auto Dealer Today