L Calabasas & O.C. shut down?

http://www.worldcarfans.com/9090114.003/vw-suing-california-lambo-dealership-for-theft-of-12-mil

A California Lamborghini dealership is being sued by Volkswagen Credit for $12 million. VW accuses Lamborghini Orange County of "outright theft" for selling their heavily discounted supercars without paying back their creditor.

Santa Ana-based Lamborghini O.C. used to be the largest Lambo dealer in the world, selling the expensive, luxurious supercars to Southern California buyers. Apparently, the dealership hit on hard times and needed to raise cash quickly.

The storefront, and its Calabasas, California, affiliate, sold off 54 Lambos in eight days. Only about 675 Lamborghinis were sold in the U.S. in 2008, meaning the O.C. dealer sold eight per-cent of the nation's Lamborghini stock in a week.

In a deal most car sellers have with their affiliate automaker, VW credit covered the purchase of the Raging Bulls in advance of any sales. Despite the fast sales, VW Credit never got their money back from the dealership. Volkswagen is the parent company of Lamborghini.

Lamborghini Orange County was closed without warning back in November. Anyone pulling up to their business at that time would see a vacant lot instead of the typical rows of exotics.

Dealership owner Vik Keuylian, and his sisters Asdghig, Nora, and Sossi, have all been named in the suit. Their attorney declined to comment. They are also being sued by East-West Bank for defaulting on a $3 million loan for the company. Vik Keulian is also being sued in Las Vegas for purchasing a used 2008 Lamborghini Murcielago, but not sending the $340,000 check.

 

Ouch! I heard such good things about their service department. Sad to see them go.

 

Check here... http://ferrarichat.com/forum/showthread.php?t=220357&page=14

 

Perhaps Ralph will do some consolidating of threads.

 

Considering that most of these cars have some form of Nav system built into them, they should be easy to find and probably disable.


Joe

 

You run in to bona fide or good faith buyer issues though. It's not like VW can easily pull a product back from a buyer once the retailer has released it into the stream of commerce. They may be stuck just suing Keuylian.

 

Thats what I thought as well..but that is not the case. The fact is from what i have been told...VW will not release the titles, so the buyers will not get a fee in clear title...this a great lesson in dealer losses and floor planning...when a dealer takes a $100k ACV loss, the floor lien cant be paid..

 

You only buy in good faith if you have paid the correct value for the product. Buying a brand new (or nearly brand new) Lamborghini at the prices that these cars went for, you are not a bona fide good faith purchaser.

 

California probably made the owner place bond for dealers liscense. In the case that you bought a car and got screwed by that dealer they would use the bond to make you whole. That may mean you only get your money back and you better be 1st in line.

 

wouldn't the cars being flipped on ebay have to be titled?

 

No, they can use dealer reassigment of title...There's a long post I made few months back that explains this quite well...The broker can just reasign the title over and over again... Of course on used cars...the new cars will would have a MSO card issued but unregistered, the broker or dealer would hand you the card and say here you go..the sad fact is after the 30-120 day temp tag period, and the buyer decides to register the car..thats where the fun begins...

 

Hi All,

I entered into a debate with someone today who feels that VW may try to reposses the cars Lamborghini of OC liquidated in the last few days of its existence. Because VW is sueing for theft can the cars be considered as being stolen property? I do not think so because they were sold by an accredited dealer but I am not sure what the legal protocol is here.

Any input?

 

Yes... I wasn't privy to the prices though.

Alternately, if they are BK, the trustee can avoid the transactions and give the cars to the creditor (VW).

 

how and who determines the correct value for the product?

 

In reality the ACV set by the wholesale price and moved by the curtailment time on the floor plan...And this situtation is a perfect example why...

You got a great buy on the car, the price was $10k-$100k back of MSRP...You feel great! Until VW come knocking on the door since the dealer could not pay the difference in cash to the floor plan off the purchase price. This is really good market lesson here and I see a whole lot more of this happening in the future.

 

Chris understood but why is the buyer responsible for the dealer's f-ck up? its between VW and their dealer. at the end of the day VW or whomever the MFG is authorized them to be their dealer of choice.

 

Saw this explanation on another site, it sounds more reasonable than some of the other theory and conjecture...
"The MSO is a legal ownership document between the seller (Lambo OC) in this case and the buyer. VW has no stake in that transaction. VW will have to sue Lambo OC. If VW was truely worried about their financial interest, they would have themselves branded as lienholder on the MSO, which rarely ever happens because then the customer would be forced to record such lien even if they paid cash for car.

If a Lambo dealership repo'd my car for this, I'd be slapping them with a suit. VW did not adequately ensure their financial interest was secured, and will therefore have to bite the bullit or sue Lambo OC. It would be no different than Lambo OC's landlord trying to stake claim to title of 50 Lambo's because the owner's did not pay them rent. VW has no contract with the buyers and the property was not stolen from them. It was owned by Lambo OC without security. VW's fault."

 

exactly

 

You can't buy something and obtain clear title if there is a lien against it. IMO it is unlikely that VW would be repossessing these cars, as reported that they are on Alan's site, if they didn't have the coloration of a case.

The bottom line is that anyone who bought one of these cars may be needing a lawyer in the near future and that is rarely for free.

 

That is the first time I have ever heard of no liens being on the MSO card if the dealer uses floor plans. The fact is that VW flooring would have had a UCC Blanket if nothing else. Every car (well at least 90% of dealers use floor plans) will have a lien on the title or the MSO card. And thats why and the only why dealers use temp tags when you buy a new or used car. It gives the dealer time to pay off liens and deliver a free and clear title. The fact is the new owner would be given a lien release with the title paper work and the app for title. They would not have to record such liens.

 

I believe you are correct.

 

but jim is not that an issue between VW and their choice of dealership?

 

Eli, because the dealer is broke, the buyer has VW's sercurtity that was sold under the knowalge that OC was closing and they ware trying to clean house and make bank. VW has to get there sercurtiy somewhere or the next bailout would be VW credit...

 

it looks like we are bailing out everyone in their mother these days anyways, just feel bad for the buyers that paid up for these cars if that's the case

 

Nope and that's the point. Anyone buying anything should always make sure that the person selling it has full, clear title and the right to sell it at the price offered especially when dealing with a broker or a dealer. These days especially so. In addition anyone buying anything should also make very sure that in the event the person selling something doesn't turn out to have full, clear title and the right to sell it that they have the unencumbered financial capacity to make one whole. If for example if there is a published UCC lien a buyer is SOL.