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Republic slings latest volley
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August 12, 1997: 1:52 p.m. ET
Huizenga's company sues Toyota in Alabama, claims right to buy dealerships
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NEW YORK (CNNfn) - Republic Industries Inc. on Tuesday filed a lawsuit against Toyota in the state of Alabama, claiming unfair trade practices in its ongoing legal battle with the Japanese car maker.
The lawsuit stems from Republic's attempts to buy Lexus and Toyota dealerships from the Dobbs Automotive Group.
Meanwhile, Appleway Toyota in Spokane, Wash., filed a complaint with the state's Department of Motor Vehicles charging that Toyota is unfairly blocking its sale to Republic. In that action, Appleway contends Toyota is illegally interfering with the transaction.
Toyota believes "that somehow their arbitrary policies supersede state franchise laws in the United States, laws which protect consumers, dealers and qualified buyers like Republic," said Steven Berrard, president and co-chief executive of Republic.
Toyota blasted Republic on Tuesday for attempting a "hostile takeover" of its dealerships.
"Toyota's name is not for sale," said Jim Press, senior vice president of Toyota Motor Sales. "Dealers can sell property, but Republic can't just buy Toyota's good name."
The car maker is suing Republic in Florida, Arizona and Texas to block the company, led by flamboyant billionaire Wayne Huizenga, from acquiring more of its dealerships. Republic has countersued in each state.
In the Alabama suit, Republic is seeking an injunction to block Toyota from interfering, as well as compensatory and punitive damages.
Republic contends state law doesn't allow a manufacturer to block a sale unless it can prove the buyer has "poor moral character" or doesn't have the money -- two thresholds the company says it easily passes.
Toyota counters that it is trying to protect locally owned businesses.
"We and Toyota dealers have proven that we give customers good value and service," Press said. "Republic has made claims that it will revolutionize the car business. All we've seen them do is gobble up dealerships."
Republic Industries started aggressively acquiring new- and used-car dealerships about a year ago. It now has 153 new-car dealerships, including two of Toyota's, and has built 14 used-car "megastores."
Republic anticipates $10 billion in sales this year, of which about $6 billion would be from the new-car dealerships.
-- Martine Costello
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Toyota
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