Logistics And Frieght Forwarding

Volvo Truck Franchisee Asks Court to Uphold $6.5M Jury Award

Volvo New 2016 VNL 670 Model (Photo: Thecohorts, CCBY-SA 4.0, wikimedia.org) After a jury in Indiana district court awarded a truck dealership £6.5 million last year finding Volvo Trucks North America breached its franchise agreement through price discrimination, the franchisee is now asking the federal appeals court to uphold the award while the U.S. Court of Appeals for the Seventh Circuit in Chicago is hearing the appeal of the lawsuit.

Earlier this month, U.S. District Court, Southern District in Indiana, granted Volvo’s motion to stay enforcement and execution of the £6.5 million judgment, and other costs, pending resolution of Mohr’s appeal. While Mohr did not object to the stay, the franchisee dealership asked for a bond to be posted by Volvo to assure payment while the appeal was being decided.

Judge William T. Lawrence stated, “In this case, the Court has a high degree of confidence in the Defendant’s [Volvo’s] ability to pay the judgment, and there does not appear to be any impediment to timely collection if the appeal is resolved in the Plaintiff’s [Mohr] favor.” Judge Lawrence said in his October 4, 2016 ruling, “Rather, the Court determines that this case falls into the category of cases in which the defendants’ ability to pay the judgment is so plain that the cost of a bond would be a waste of money.”

The legal battle erupted in 2012 when Volvo Trucks filed two federal lawsuits against Andy Mohr Truck Center, a veteran auto dealer in Indiana that the company signed on in 2010, to grow its market share. In the complaints, Volvo asserted the franchisee breached its contract when it did not live up to its commitment to build a new dealership facility and purchase £1 million in Volvo truck parts. It also alleges Mohr did not sell the 500 trucks per year or buy 5 new parts-delivery vans, which the franchisee promised to do.

Because of that, Mohr did not achieve his anticipated market gains. Volvo claimed the dealership fraudulently induced it to enter into the five-year franchise agreement, by making promises that he was unable to fulfill. Volvo was seeking unspecified damages for lost market share and lost profits of more than £100,000, and asked that its contract with Andy Mohr Truck Center be rescinded, according to the lawsuit.

The Andy Mohr dealership fought back, filing a countersuit against Volvo. The Indiana franchisee alleged Volvo did not live up to its promise to award him the Mack Trucks franchise, which Volvo owned and controlled. Mohr also claimed the truck franchisor failed to provide the same price discounts on its trucks that it offered to similar franchisees elsewhere.

The countersuit stated that Volvo “intentionally lowballed price concessions causing his dealership to lose out on approximately 1,300 truck sales because it did not receive the same discounts as rival Volvo dealerships.” The district court ruled in Mohr’s favor in August 2015, after the jury found Volvo Trucks violated the Indiana Deceptive Franchise Practices Act for price discrimination. Mohr’s attorney, Robert MacGill of Barnes & Thornburg LLP, said at the time they filed the countersuit that Volvo Trucks was to blame for the broken relationship, not his client.

He then stated, “Andy Mohr Truck Center has notified Volvo of its claim for damages arising from Volvo’s conduct inducing the sale of the franchise.” Baker Hostetler is representing Volvo Trucks North America.

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