Tesla 2 – Dealership Associations 0, As Injunction Fails In Massachusetts

5 years ago by Jay Cole 6

Tesla's Dealership In Massachusetts Opened In September, Remains Open Today

After previously winning a legal battle to open its store boutique in Natick, Massachusetts, Tesla got rewarded with two new lawsuits attempting to force the company to franchise dealers.

Those lawsuits where then followed by a request by the NADA (National Automotive Dealers Association) to have a little meeting with the company to put a little strong-arm pressure on Tesla to stop selling direct to consumers on the internet via these boutique outlets in highly visible areas.

Now, Tesla has won another round in the fight.

We Are Pretty Sure The Tesla CEO Is Making This Face Today

Despite Tesla’s store legally being opened in Natick, the Massachusetts State Automobile Dealers Association (MSADA?) is still ploughing forward with litigation against the company, and just recently went to the Massachusetts Superior Court for a restraining order and injunction against Tesla.

And what would this injunction involve?

To stop Tesla from providing “anything other than an unstaffed display of a locked automobile.”

This would effectively neutralize Tesla’s advantage by making it nothing more than a common mall display, one like you could see inside any mall in the US.

There was one little snafu with the litigation of course; to get an injunction plaintiffs must show they are likely to prevail in the case and will otherwise suffer irreparable harm.

Considering Tesla just put a beat-down on MSADA in September, the result of the injunction request seemed predictable.  And indeed, a Massachusetts judge “denied the request by dealers for a preliminary injunction against Tesla Motors Inc., ” which means Tesla is free to operate its store, as it does now as the lawsuit proceeds…provided the dealer association still wants to take another run at them.

And they do.

“Dropping the lawsuit is not an option at this point,” said Robert O’Koniewski, executive vice president of the Massachusetts association, “We feel very strongly that Tesla is operating a factory store outside parameters of our franchise law and our license law, and they are operating that store illegally.”  He also added the group is considering an appeal.
In an email to the Automotive News, Shanna Hendriks, a Tesla spokeswoman, said the court made the right decision.

“Tesla looks forward to continuing to focus on advancing the knowledge of EVs in a convenient, accessible environment,” she wrote. “We remain hopeful for a positive outcome of this case.”

Automotive News (sub) 

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6 responses to "Tesla 2 – Dealership Associations 0, As Injunction Fails In Massachusetts"

  1. Mike Colvin says:

    Reminds me of a Mob shakedown – they’ll try to bleed Tesla in court costs ’til they have to give in or go under. Shameful.

    1. vdiv says:

      Looks like they may encounter a few “stubborn” judges on the way. If successful this by itself would be such a significant contribution to the auto industry that it may rival the whole electric car mumbo jumbo nonsense that Tesla is supposedly all about 😉

  2. Wayne Wood says:

    I had the pleasure of visiting the newest Telsa location in Toronto this past weekend. The mall was a buzz with the opening of several new high profile stores including Microsoft. As we walked the new area, we came upon the Telsa store and immediately went in. In a word. Awesome. Finally someone who gets it. A company that won’t be bullied by a dumb Dealership Association that doesn’t get it. The auto industry is scrambling to be relevant. They should take a page from Apple and understand.. its all about the customer experience.

    We are now living in the “Age of the Buyer” and the sooner the traditional automobile marketers wake up, the sooner they will be able to embrace the fact that today’s consumers are in control and any attempt to try and stop that will result in contempt by consumers. I’m planning to put my reservation for a Telsa Model S and wont have to endure the painful experience of dealing with a contriving dealership. My last purchase was a Jag I bought off the showroom floor.. no need to test drive, or negotiate price. I knew what “I” wanted. It wasn’t about what “they” wanted. I would have preferred to buy it online, and have it delivered to my door , but had to endure the irrelevant sales person to sales manager process.

    The dealership industry must change to be relevant to today’s buyers… Telsa’s CEO Musk shares on his blog why they don’t sell using dealerships and it was refreshing.. Can you imagine, a car dealership salesman trying to explain what’s on the 17″ screen.. they can’t even make a decision without the “let me speak to my sales manager” line.

    1. Jay Cole says:

      Good stuff Wayne! I am going to be in Toronto on Saturday myself, and was thinking about making a stop to check out Tesla’s latest digs.

  3. evnow says:

    Hey, I thought this was a “free” country …

  4. Open-Mind says:

    Good for Tesla!

    It appears the liberal green movement is still more powerful than the liberal anti-capitalism movement. When an ideology collides with itself, the results are always interesting. 😉