L Calabasas & O.C. shut down?

Roy, with ~54 of these cars out there...what is a buyer to do? i assume these cars come up clear on carfax, etc. last thing someone wants is to buy one of these care 2-3 years down the road....at a price then which probably would be close to true market, and take it in for servicing and have it repoed. VW/Lambo has to realize that would cause a huge PR headache as well....

 

This is similar to what has happened in the past here (Canada)

 

Isn't it already a huge PR headache?

 

wow!

http://ocbiz.freedomblogging.com/2009/01/22/judge-tosses-suit-against-lamborghini-oc/8502/

An Orange County Superior Court judge today dismissed a lawsuit against Lamborghini Orange County, once the world’s largest dealer of the Italian-made exotic autos, because Volkswagen Credit Inc. did not present a strong enough case to get punitive damages.

“We’re very happy with the ruling and we’ll wait to see what VCI does,” said Jeffrey Gubernick, the attorney representing the dealer’s owners.

Judge Franz E. Miller said from the bench that VW Credit could refile its suit against the auto dealer, if it adds more specific allegations to its complaint. Michael Schulman, the attorney for VW Credit, declined to comment on his plans.

VW Credit said in its suit that Lamborghini Orange County and its sister dealership in Calabasas sold 54 Lamborghinis worth about $12 million at deep discounts during an eight-day period last fall, accounting for 8 percent of all Lamborghinis sold in the United States in 2008.

Lamborghini Orange County closed in November after VW Credit pulled the line of financing the dealer needed to keep cars on its showroom floor. The dealer remains shut.

 

This whole deal is BS!!! some of these guys on this thread defending Lambo/VW must work for Lamborghini!! It only obvious they're trying to push there own cars in this aweful market... and re: warranty, Comm'on that's a joke. Of course there gonna have to honor those warranties. Maybe for now there are red flags. But once VW loses the case, These cars become good again 100%.

 

Why would you think that?

What damages has a person suffered who has had warranty work refused by Lamborghini?

The damages, IMO, would pretty much be whatever they had to pay to get whatever was wrong, fixed. I don't see how someone could come up with damages that would come close to covering the cost of the car. In civil suits, lawyers fees are not recoverable, except in special cases (civil rights, etc, and a few others).

I think that if someone gets their warranty coverage denied by Lambo, and if they can compel Lambo to honor the warranty in court, then their total damages are likely pretty much the cost of the repair. Now, of course they could start tacking on all sorts of junk like emotional distress and the time value they spent getting the work done, but in my experience that's more likely to piss of a judge than anything.

Lambo is obviously pretty PO'ed that this happened and is not going to just get stepped on by LOC and are doing all possible to fight back.

I agree with Roy... these cars at hot potatoes, and I wouldn't touch one with a 10 foot pole.

Just my .02

 

I guess I am one of those people "defending Lamborghini". Don't you think they were wronged?

Make no mistake, the people who bought the cars are being wronged too, but the root of it all is not the buyers nor VW/Lamborghini. The root of it all is LOC, it seems.

Just because VW is a corporation that does significant business, does not make it "ok" for them to be swindled out of 12 million dollars.

As for your assertion that "of course they are gonna have to honor those warranties", is that a legal opinion? Based on what? They are a private company. Who is going to make them "have to" do it? If they feel the cars were not legitimately sold, then they are not going to perform warranty work. Someone who feels wronged can obviously pursue a case against VW. Probably cost $20k+++ and you won't get your attorney fees back.

If you are confident that there are no issues, why not pick one of these cars up at a substantial discount? There is at least one of them on eBay.

 

Interesting, but, not that telling because it was dismissed without prejudice. It wasn't dismissed on the merits of the case, but rather because the judge felt the allegations were not specific enough to warrant punitive damages (which, IIRC requires willful or premeditated fraud or whatever it's termed legally). I'll wager VW filed the case very quickly and added everything under the sun for claims. Looks like the judge told them to get their assertions in order and bring it back when they did.

I would bet it will be re-filed soon.

 

We were approached by several brokers offering deep discounts on these cars when this first began and Roy was pretty adamant about not buying any of them, something just didn't sit right with them. In hindsight, I'm as happy as Roy is that we didn't get involved. It's an ugly situation for everyone, enthusiasts, dealers, buyers and sellers. It literally crushed the Lamborghini market...I'm sure a lot of people are sitting around saying "Thanks Vic...thanks a lot"...bottom line, and I'm not supporting either side on this, Vic had a choice to make and he opted to do the wrong thing, which in turn screwed many, many people and will ultimately cost more in the long run than what VW lost in this....so they get a judgement, prove their damages, get attorney fees, etc...so what? The next obstacle is COLLECTING on that debt...good luck collecting on it when the money is gone, all assets repossessed/seized, and you're out of the country...that's the harsh reality in all of this.

This damage stands to linger for decades after it's resolved...if it ever gets resolved. The lenders are wise to what took place, they're not over extending on these cars because they too have a list of the vin's of cars on the "do not lend" list...it's going to be a long and tedeous task for all parties to finally clear this mess up. I feel for both sides...some people bought those cars simply thinking they were getting a screaming deal...others simply took advantage of the situation. Best of luck to everyone in this saga...this has hollywood written all over it!

 

I admire Roy for his conduct in this matter this was definitely not a "Golden opportunity".

 

Although my comment was intended in sarcasm, I really do believe that someone willing to push this issue far enough could recover punitive damages. Who's to say that a judge wouldn't be more pissed at VW for yanking otherwise valid warranties out of perceived spite than some guy claiming emotional distress and lost time? It's a crap shoot, but I wouldn't be so sure that VW would come out a winner...

My $.02

 

I couldn't agree more Roy! I'd still like to know what motivated Vik to suddenly crash his own dealership and reputation rather than sell the business and strike a deal with his creditors if he was in trouble. I didn't see any hints of a problem and my car was on a truck just two hours away when they shut down. There was no hint from other family members who were encouraging me to get down to OC. I still think there is a bigger story that hasn't come out.

 

Back up a bit and read some of the earlier posts.

It doesn't look as if this was all that sudden. Vik was apparently up to his neck and it was time to "get out of Dodge".

Considering the recent economic conditions it seems unlikely that there were any buyers lined up that could have made him "whole".

 

Punitive damages are generally not allowed in contract lawsuits, and a suit to get VW to cover warranty work would fall under a contract dispute. It has to be a very blatant and serious issue to fall qualify for punitive damages, and even in such cases there are generally "reasonable ratios" imposed of 1:1 or 3:1. In the case of a warranty dispute, it would be hard for an owner to rack up enough in actual damages that even if punitive damages were awared (and it's very very rare... like winning the lottery rare), it wouldn't be any sort of a "woohoo I'm retiring!" payday.

I see where you're coming from and I would guess that VW may very well lose a suit brought by an owner who was denied warranty coverage. But I'd bet by bottom dollar that they wouldn't be hit for punitive damages and the plaintiff would probably only get court costs and the actual damages. The attorneys fees would be unrecoverable, and they would proabably be higher than the actual damages.

Of course, we're just guys yapping on the intarwebs, so we'll see how it plays out in court

 

Doesn't that make us the experts?

 

Isn't it strange that noone has heard from Vik?

He hasn't made any public statements defending himself or issues press releases proclaiming his innocence.

(My Opinion) I think there is way more to this story than is publically known.

We really need to hear Vik's side of the story!!!!

I would have assumed if someone here knows Vik and his family, they would have posted just a few statements defending him.

(I am still wondering, since VW is sueing Vik over LamboOC, why hasn't VW closed his VW dealership????)

Thanks,
UZY

 

Not really. I don't see any motivation for him to make a statement?

I'm not an attorney, but if VW is suing Vik (the person) VW may not simply be able to close down his dealership just because Vik owns it. I'm sure that each dealership is structured as its own entity, and all separate from Vik the person.

 

You're right. They are separate legal entities and there would be no justification to close the other VW dealership *unless* there was some sort of universal default clause. But I would bet that each dealership had its own LLC or corporation.

What I find sad yet fascinating is that this guy was apparently was such good standing with the company that they were naming colors after him (Rosso Vik), and now he completely nuked their relationship.

 

Completely agree. There has to be much more going on below the surface.

 

When you have many legal matters pending, your attorney will advise you not to comment on anything, including the press, friends, chat rooms, etc. I know the Keuylian's and they are business people that got caught up in a bad economy. They welcomed all customers and they are rare when it comes to car dealers.

54 cars in 8 days? is simply not true. This was a rumor and not true!. Theses cars where sold over a 2-3 month period.

I went on the Giro in 06, 07 and 08 and LOC made it great.

People ask why no dealership has opened in Orange County. The reason: Vik is wanting to sell the dealership rights and I agree with him!

Since 1994, he has worked hard for them. Why would he give the dealership rights away for nothing?

I back him and his sisters. Lamborghini is not the same. By the way, Vik and his sisters still own and operate Commonwealth VW and Audi.

 

The Lamborghini dealers that were around when Vik controlled the distributorship in North America will probably disagree with you on that one.

 

VW Credit will do what it can, legally or otherwise, such as illegally repoing these cars......and is probably banking that the former owners of the cars will not fight back in court. Which I imagine they would.