Ohio Auto Dealers Push to Shutter Tesla's (TSLA) Operations
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Tesla Motors (Nasdaq: TSLA) is facing more resistance in the Midwest as it looks to expand its dealer network.
According to the Columbus Dispatch, a group of automobile dealers in Ohio have sued to revoke Tesla's license to sell cars in Franklin County. The group, which includes several central-Ohio dealers, cite breach of state law.
Defendants include Tesla, the Ohio Department of Public Safety, and the Ohio Bureau of Motor Vehicles (BMV).
Tesla is approved to sell its vehicles directly to customers, but the plaintiffs think that the license was improperly granted given that the company didn't provide a copy of its contract with the manufacturer of the vehicles to be sold. The group noted that the dealer and manufacturer are the same copy, but still note that the law -- which calls for a contract between
Tesla feels it has made a valid argument in the past in saying that it hasn't violated the franchise law because it doesn't have any franchises.
The case was filed last week and the dealers filed a motion Tuesday seeking an injunction to immediately rescind Tesla's license and prevent the BMV from issuing additional licenses to Tesla.
Shares of Tesla are down 3.8 percent.
According to the Columbus Dispatch, a group of automobile dealers in Ohio have sued to revoke Tesla's license to sell cars in Franklin County. The group, which includes several central-Ohio dealers, cite breach of state law.
Defendants include Tesla, the Ohio Department of Public Safety, and the Ohio Bureau of Motor Vehicles (BMV).
Tesla is approved to sell its vehicles directly to customers, but the plaintiffs think that the license was improperly granted given that the company didn't provide a copy of its contract with the manufacturer of the vehicles to be sold. The group noted that the dealer and manufacturer are the same copy, but still note that the law -- which calls for a contract between
two separate contracting parties-- was violated.
Tesla feels it has made a valid argument in the past in saying that it hasn't violated the franchise law because it doesn't have any franchises.
The case was filed last week and the dealers filed a motion Tuesday seeking an injunction to immediately rescind Tesla's license and prevent the BMV from issuing additional licenses to Tesla.
Shares of Tesla are down 3.8 percent.
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