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)

(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)

(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
Last accessed
May. 15, 2020