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Saturday, January 5, 2013

Dealers' lawsuit against Tesla in Mass. dismissed by judge

Dealers trying to block Tesla Motors Inc.'s retail stores in Massachusetts lost another round this week when a judge dismissed their lawsuit against the electric vehicle maker.

In a ruling issued Monday, Norfolk County Superior Court Judge Kenneth Fishman said the Massachusetts State Automobile Dealers Association and other plaintiffs lacked standing to sue. It was the same reasoning the judge used in a November ruling denying a preliminary injunction against Tesla's suburban Boston store.

"We disagree with his decision," Robert O'Koniewski, the association's executive vice president, said Thursday. He contends the association has standing under changes made to the state's franchise law in 2002. "If you read the statute, it's pretty clear: a factory cannot own a store, and a dealer can sue for injunctive relief if they feel the public is being harmed."

Tesla didn't immediately reply to a request for comment.

Tesla's first Massachusetts showroom opened in September in the Natick Mall. The dealer association and the other plaintiffs -- two dealerships and a dealer -- sued in October, saying that Tesla's stores violate state licensing, consumer protection and franchise laws.

In December, Tesla won municipal approval of a dealer license for a second location in Natick that it planned to open soon.

O'Koniewski said the dealer association is considering its options, including whether to seek an appeal of the Dec. 31 dismissal. There is a 30-day time limit to file for an appeal, he said. The dealer association also has had discussions with the state attorney general, which has enforcement power over state franchise law.
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