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Honda-Republic battle ends
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June 10, 1998: 11:29 a.m. ET
Huizenga's car dealership chain settles second of three lawsuits by auto makers
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NEW YORK (CNNfn) - American Honda Motor Co. Inc. and Republic Industries Inc. said Wednesday they have settled a year-long legal clash over the purchase of Honda and Acura dealerships.
The settlement, following a similar deal between Toyota Motor Corp. and Republic last year, averts several pending state lawsuits and will facilitate Republic's plans to buy a dozen dealerships across the nation.
The settlement comes a week after a Colorado judge dismissed a suit Honda had filed against Republic and John Elway, the Denver Broncos quarterback, who sought to sell his Honda dealership to Republic.
"The agreement sets the conditions under which Republic may purchase Honda and Acura dealerships, and allows the parties to put aside the distractions and burdens of litigation," said Richard Colliver, American Honda's executive vice president.
Republic Chairman and CEO Wayne Huizenga, a waste collector turned car dealer, has been a key consolidator of auto dealerships, gobbling up 297 across 17 states over the past year and a half. Four were Honda or Acura dealerships.
In May 1997, Honda filed the first of seven state lawsuits against Republic to block its purchase of the independently owned dealer franchises.
Honda argued that Republic's consolidation clashed with its policy of keeping dealerships out of the hands of publicly traded companies, and warned it could hurt customer service. In the Colorado case, it also claimed breach of contract as well.
In addition to Colorado, Honda filed suits in Alabama, Arizona, California, Georgia, Tennessee and Texas. All those suits now are moot.
Republic plans to close the purchase of 12 Honda and Acura dealerships "as quickly as we can," said spokesman Jim Donahue.
Republic, which said it has come to an "understanding" with the Big Three Detroit automakers, still faces legal action by Nissan Motor Co.
Shares of Republic Industries (RII) were up 3/8 at 25-3/8 following the announcement.
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Honda
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