Virginia Automobile Dealers Association filed a lawsuit against Tesla Motor Co that seeks to keep the American automotive from operating a second company store in the state. Meanwhile, the all-electric automaker said in a statement that it will "vigorously defend" itself against the lawsuit.
On Wednesday, VADA sued Tesla Motors claiming that the company and Virginia's Department of Motor Vehicles commissioner Richard D. Holcomb dishonored a law that the automaker could not own or open a second store in the state until 2017. Fortune reported that the state law prohibits any manufacturer to own or operate a dealership, but commissioner Holcomb is allowed to provide a license if a hearing concludes that there is no merchant independent of the manufacturer which can operate a franchise. In December 2013, Tesla Motors Co. was granted such license from the state through a settlement agreement.
President of VADA, Don Hall, said the car manufacturer with the state's DMV help attempted to go behind VADA's back and launch a gallery in the state. According to The Country Caller, the lawsuit asserts that Holcomb assigned a hearing official for the department's hearing. The hearing is set on March 31, at the company's request.
One of the members of VADA, who discovered a real-estate deal for a property in Richmond for the new Tesla store, informed Hall about it; hence, the lawsuit. Tesla said in a statement via email that the VADA lawsuit is 'entirely without merit'. The company argues that the 2013 agreement does not prohibit it from opening future dealerships, says Reuters.
The agreement made in 2013 was reached as a compromise between VADA, the commissioner of the VDM and Tesla Motors. Tesla said that it will continue to fight for consumer freedom in Virginia and for their customers as well.
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