ORS 650.150
Enjoining establishment of certain franchises or relocation of existing dealership in same market area

  • complaint
  • determination of good cause
  • when offer of new franchise or relocated dealership required
  • notice to existing or former dealerships
  • attorney fees

(1)

A dealer or former dealer may enjoin a manufacturer, distributor or importer, or the manufacturer’s, distributor’s or importer’s successor in interest, from franchising an additional motor vehicle dealership of the same line-make within the dealer’s or former dealer’s relevant market area for good cause, provided that the dealer files a complaint with a court of competent jurisdiction within 60 days of receiving the notice specified in subsection (6) of this section. For purposes of this section, “relevant market area” has the meaning given that term in ORS 650.120 (Definitions for ORS 650.120 to 650.170), but other factors such as actual sales and service area must be considered.

(2)

A dealer or former dealer may enjoin a manufacturer, distributor or importer, or the manufacturer’s, distributor’s or importer’s successor in interest, from relocating an existing motor vehicle dealership of the same line-make within the dealer’s or former dealer’s relevant market area for good cause, provided that the dealer or former dealer files a complaint with a court of competent jurisdiction within 60 days of receiving the notice specified in subsection (6) of this section. This subsection does not apply to an existing dealership or to the dealership of a replacement dealer that is relocating to a site within a one-mile radius of its existing site if the relevant market area of the existing or replacement dealership is not more than 10 miles, within a two-mile radius of its existing site if the relevant market area of the existing or replacement dealership is not more than 15 miles and within a three-mile radius of the existing site if the relevant market area of the existing or replacement dealership is more than 15 miles.

(3)

Intentionally left blank —Ed.

(a)

A dealer or former dealer may enjoin a manufacturer, distributor or importer, or the manufacturer’s, distributor’s or importer’s successor in interest, from franchising a replacement dealer to operate a dealership of the same line-make within the dealer’s or former dealer’s relevant market area for good cause, provided that the franchising of the replacement dealer has not occurred within one year of the expiration or termination of the former franchise and the dealer files a complaint with a court of competent jurisdiction within 60 days of receiving the notice specified in subsection (6) of this section. For the purposes of this section, “relevant market area” has the meaning given that term in ORS 650.120 (Definitions for ORS 650.120 to 650.170), but other factors such as actual sales and service area must be considered.

(b)

Notwithstanding paragraph (a) of this subsection, when good cause exists as provided in subsection (5) of this section, a dealer or former dealer may enjoin a manufacturer, distributor or importer, or the manufacturer’s, distributor’s or importer’s successor in interest, under this subsection within five years of the expiration or termination of the former franchise without regard to when the franchising of the replacement dealer took place or will take place.

(4)

In determining whether good cause exists pursuant to subsection (1), (2) or (3) of this section, the court may consider all factors that the court considers relevant, but in any case shall consider the following factors:

(a)

Whether threats or other coercive action, oral or written, were made to or taken against the dealer by the manufacturer, distributor or importer.

(b)

Whether the dealer is asked to terminate one franchise in order to keep another franchise.

(c)

Whether the manufacturer, distributor or importer, or the manufacturer’s, distributor’s or importer’s successor in interest, breached the terms or provisions of a franchise.

(d)

Whether the manufacturer, distributor or importer, or the manufacturer’s, distributor’s or importer’s successor in interest, engaged in conduct prohibited under ORS 650.130 (Prohibited conduct by manufacturer, distributor or importer).

(e)

Whether the manufacturer, distributor or importer, or the manufacturer’s, distributor’s or importer’s successor in interest, canceled, terminated or refused to continue a franchise without good cause under ORS 650.140 (Good cause required to terminate dealer franchise).

(f)

Whether there will be an unjustifiable adverse effect upon existing dealers because of the grant of the new franchise or the relocation of an existing franchise. For purposes of this paragraph, the court may consider all factors that the court determines relevant, but in any case shall consider the following factors:

(A)

The extent, nature and permanency of the investment of the existing motor vehicle dealers and the proposed motor vehicle dealer.

(B)

The effect on the retail motor vehicle business in the relevant market area.

(C)

The growth or decline in population and in new motor vehicle registrations in the relevant market area.

(g)

The effect on consumers in the relevant market area. For purposes of this paragraph, the court may consider all factors that the court determines relevant, but in any case shall consider the following factors in the relevant market area:

(A)

The adequacy and convenience of existing motor vehicle sales facilities and service facilities.

(B)

The supply of motor vehicle parts and qualified service personnel.

(C)

The existence of competition among existing dealers.

(5)

Intentionally left blank —Ed.

(a)

Notwithstanding subsection (4) of this section, good cause as used in this section shall be deemed to exist without consideration of any other factors when a dealer or former dealer’s franchise was canceled, terminated or not continued for any reason other than good cause pursuant to the terms of the franchise agreement or as a result of the manufacturer, distributor or importer, or the manufacturer’s, distributor’s or importer’s successor in interest, having breached the terms of the franchise agreement.

(b)

A manufacturer, distributor or importer, or a manufacturer’s, distributor’s or importer’s successor in interest, enjoined for good cause under this subsection shall offer the franchise sought to be granted or relocated to the dealer or former dealer whose franchise was canceled, terminated or not continued. The dealer or former dealer shall have 60 days within which to accept or reject the offer required under this paragraph. Only after a dealer or former dealer has declined, rejected or failed to respond to the offer required under this paragraph, may the manufacturer, distributor or importer, or the manufacturer’s, distributor’s or importer’s successor in interest, offer to grant the franchise to another dealer or replacement dealer or relocate an existing motor vehicle dealership.

(6)

A manufacturer, distributor or importer must give a dealer or former dealer at least 60 days’ written notice prior to franchising a new dealership of the same line-make or authorizing the relocation of another dealership of the same line-make within the relevant market area of the dealer’s or former dealer’s dealership. Notice under this subsection must be given to all dealers and former dealers of the same line-make within the relevant market area of the site of the proposed new or relocated dealership.

(7)

If a dealer or former dealer enjoins or files an action to enforce rights arising under this section against a manufacturer, distributor or importer, or a manufacturer’s, distributor’s or importer’s successor in interest, the manufacturer, distributor or importer, or the manufacturer’s, distributor’s or importer’s successor in interest, shall pay the dealer’s or former dealer’s court costs and attorney fees if the dealer or former dealer prevails regardless of whether a new dealership was actually established. [1980 c.3 §4; 1985 c.67 §1; 1993 c.216 §2; 1999 c.660 §3; 2009 c.627 §5]

Source: Section 650.150 — Enjoining establishment of certain franchises or relocation of existing dealership in same market area; complaint; determination of good cause; when offer of new franchise or relocated dealership required; notice to existing or former dealerships; attorney fees, https://www.­oregonlegislature.­gov/bills_laws/ors/ors650.­html.

Notes of Decisions

This section is not intended to apply in action to enjoin establishment of new auto dealership to protect existing dealers from ordinary economic impact of additional dealer. Armstrong Buick, Inc. v. General Motors Corp., 597 F Supp 932 (1984)

LAW REVIEW CITATIUONS: 50 WLR 195 (2014)

650.005
Definitions for ORS 650.005 to 650.100 650.010
Franchise sellers required to maintain books and records 650.015
When franchise sale or offer for sale is made in this state 650.020
Liability of franchise seller 650.050
Rules 650.055
General duties and powers of director 650.057
Orders issued under ORS 650.055 650.060
Investigative powers of director 650.065
Injunctive relief 650.070
Director as agent for service of process 650.075
Manner of executing service of process 650.080
When personal service of process required 650.085
Other civil or criminal remedies unaffected 650.095
Civil penalties 650.100
Disposition of civil penalties 650.120
Definitions for ORS 650.120 to 650.170 650.123
Use of protected dealer data 650.130
Prohibited conduct by manufacturer, distributor or importer 650.132
Prohibition of coerced sales of extended service contracts, extended maintenance plans or guaranteed asset protection waivers 650.133
Constructing, altering or remodeling dealer facility 650.140
Good cause required to terminate dealer franchise 650.145
Compensation due dealer upon termination of franchise 650.150
Enjoining establishment of certain franchises or relocation of existing dealership in same market area 650.153
Liability of franchisor for repair of motor vehicle that becomes inoperative prior to sale to consumer 650.155
Liability of manufacturer for damages to vehicles before delivery to carrier 650.158
Predelivery preparation and warranty service 650.161
Compensation for repairs to vehicles subject to recall 650.162
Transfer, assignment or sale of interest in dealership or franchise 650.165
Prohibited franchise conditions 650.167
Violation of ORS 650.140 or 650.150 as irreparable injury 650.170
Dealer’s remedy 650.200
Definitions for ORS 650.200 to 650.250 650.205
Prohibited conduct by franchisor 650.210
Rights and prohibitions governing relationship between franchisor and franchisee 650.215
Prohibited conduct in offer, sale or purchase of franchise 650.220
Consent of franchisor to sale, assignment or transfer of franchise 650.225
Death of franchisee 650.230
Transfer of franchise to corporation in which franchisee has controlling interest 650.235
Franchisor prohibited from requiring operation of service station in excess of 16 hours per day 650.240
When transfer of motor fuel a sale in commerce 650.245
Principle of good faith 650.250
Injunctive relief or damages 650.300
Definitions for ORS 650.300 to 650.480 650.310
Good cause 650.320
Dealership agreement 650.330
Comparable terms and conditions 650.340
Termination, cancellation or failure to renew 650.350
Dealer’s rights upon termination, cancellation or failure to renew 650.360
Coercion prohibited 650.370
Transfer by dealer 650.380
Dealer’s successor 650.390
Dealer compensation for warranty service 650.400
Recalls 650.410
Dealer’s warranty obligations 650.420
Required disclosures 650.430
Damaged or defective vehicles 650.440
Grantor’s ownership, operation or control of dealership 650.450
Indemnification 650.460
Indemnification 650.470
Remedies 650.480
Remedies
Green check means up to date. Up to date

Current through early 2024

§ 650.150’s source at oregon​.gov