Fixed Ops Journal - December 2019 - F31

FIXED OPS JOURNAL

LEGAL LANE
Court: Loose lug nuts didn't
violate state repair law

The Michigan Court of Appeals threw out an
award of $68,700 in attorney fees against a
dealership whose service department failed to
properly tighten the lug nuts on a wheel during
a tire rotation. The lawsuit was filed by a passenger who was hurt when the left front wheel
came off the vehicle two blocks from Betten
Chevrolet in Muskegon in October 2013. The
lug nuts were found at the scene.
The dealership acknowledged that its service technician had been negligent but disputed the passenger's claim that it had also
violated the state's Motor Vehicle and Repair
Act. That law makes repair facilities liable for
plaintiffs' attorney fees and court costs in addition to damages.
In a unanimous ruling, the three-judge appeals panel let stand the $40,000 jury verdict
for negligence but cleared Betten Chevrolet of
the passenger's lawyer fees.
The Michigan law prohibits shops from
charging for repairs "that are in fact not performed." The court said the purposes of the
law "include regulating the practice of servicing and repairing motor vehicles and proscribing unfair and deceptive practices."
In this case, the court said, Betten did perform the tire rotation. The judges found no evidence that the technician failed to "remove
the tires and replace them on different axles
or sides of the vehicle," even though he negligently forgot to use the torque wrench to tighten the lug nuts.
The plaintiff 's lawyer, Donald Fulkerson, of
Westland, Mich., told Fixed Ops Journal that
he will ask the court to reconsider the decision. He said the panel failed to consider
whether the dealership violated the state law
by "making an untrue or misleading statement."
A lawyer for the dealership, Caryn Ford of
Detroit, declined to comment on the case.

Dealership found not biased
against fired service adviser
A suburban Philadelphia dealership won a
federal age and disabilities bias suit filed by a
longtime service adviser who was terminated
at age 61.
U.S. District Judge Jan DuBois dismissed the
case, finding insufficient evidence that Videon Chrysler-Dodge-Jeep in Newtown Square,
Pa., discriminated against Richard Hamilton.
The adviser was hired by the store's previous
ownership in 1998. He had a heart attack on

the job in 2011 and returned to work several
months later.
Hamilton worked under the current ownership until September 2012, when he and another 61-year-old service writer were discharged, the court decision said. The dealership kept its third service adviser, who was 43
years old, and hired an adviser in his 30s to replace the two who were terminated.
The dealership contended that it fired Hamilton because of his difficulty using its computer system and because the service manager, a new sales manager and other employees
perceived him as "slow and/or not sufficiently
responding to customers' needs," the decision
said. The judge said Hamilton failed to offer
enough evidence about whether the store
used Hamilton's computer problems and inadequate responsiveness to customers as a
pretext for discrimination.
"Although he was not terminated until after
he developed a heart condition, he has not presented any other evidence showing a logical
connection between this timing and the possibility of age discrimination," the ruling said.
Hamilton hasn't appealed the decision, said
dealership lawyer Kathryn Chandless, of
Newtown Square.

Retailer dealt unfairly with
techs' union, judge rules
After a dealership group acquired two Chicago-area stores with unionized service technicians, it committed unfair labor practices in
its dealings with the International Association
of Machinists and Aerospace Workers, an administrative law judge ruled.
Zeigler Auto Group's violations included
unilaterally changing employee health insurance and retirement benefits, eliminating
weekly minimum pay, making side deals with
favored workers, discharging two technicians
for union activities and installing surveillance
cameras, National Labor Relations Board
Judge Charles Muhl said. The company is appealing the ruling.
Muhl also found that dealer principal Aaron
Zeigler improperly refused to sign labor contracts that technicians had ratified until two
weeks before a hearing in the case.
In 2018, Zeigler bought Grossinger Auto
Group and McCarthy Ford, operating the
dealerships as Zeigler Ford of North Riverside,
Zeigler Buick-GMC of Lincolnwood and Zeigler Cadillac of Lincolnwood, all in Illinois.
With 28 new-vehicle dealerships, Zeigler Auto
Group, based in Kalamazoo, Mich., ranks No.

58 on Automotive News' list of the top 150
dealership groups based in the U.S.
The judge ordered Zeigler Auto Group to
retroactively fund benefits it had cut, restore
previous health care benefits, bargain in good
faith and reinstate the technicians it discharged with seniority and back pay.
Lawyer James Hendricks, of Oak Brook, Ill.,
said that Zeigler is taking the case to the full
NLRB. He added: "If we don't get a positive
decision from the NLRB, the next step is the
U.S. Court of Appeals."

Body shop whistleblower
can keep arbitration award
A body shop manager at a Texas dealership,
who was fired in retaliation for reporting possible criminal conduct, is entitled to a
$334,922 arbitration award, the Texas Court of
Appeals unanimously ruled.
The court rejected a bid by Central Houston
Nissan to overturn the award in favor of Chris
Singleton, who was hired by the dealership in
February 2016 under a one-year contract to
open and manage its collision repair center.
The court said Singleton found evidence
that people at the Nissan store and a related
company "were engaged in what he believed
to be insurance fraud. The fraud involved the
submission of fraudulent claims to insurance
companies for reimbursement of repairs not
actually performed."
Singleton showed a spreadsheet that summarized allegedly fraudulent insurance invoicing to his immediate supervisor and told
the store's owner and controller about it, the
court said. Central Houston Nissan fired him
the day after he told management he "was unwilling to participate in these activities," according to the ruling.
Singleton took the case to arbitration under
his employment contract. The arbitrator ruled
against Central Houston Nissan, concluding
that it terminated Singleton because he refused
"to participate in illegal and fraudulent activity."
The appeals court said it found no basis to
overturn the arbitration award, rejecting the
dealership's argument that it conflicted with
public policy in Texas as an "employment at
will" state. The court also rejected the assertion that Singleton's reporting of misconduct
wasn't legally protected because the dealership's management did not explicitly ask him
to do anything illegal.
- Eric Freedman
foj@autonews.com

DECEMBER 2019

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Fixed Ops Journal - December 2019

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