L.A. jury orders Micheal Khan to pay $40M for Nissan settlement

Article by Christian A., on December 30, 2011

A Los Angeles jury has ruled last week that Michael Kahn must pay $40 million to Nissan Motor Acceptance Corp. to settle a claim alleging that he was selling out of trust, the industry's term for a dealer's nonrepayment of borrowed funds. Kahn ran the fastest-growing dealership group in the U.S. in 2007. 

Khan's Superior Automotive Group had two Toyota dealerships, five Nissan stores and a Chrysler franchise in Los Angeles and San Francisco.

The group rose to 73rd position on Automotive News' list of the top 125 dealership groups in 2007, a boost from 106th in 2006. However, it collapsed in February 2009 after Nissan's finance unit alleged that he was selling out of trust. The company canceled financing and seized Khan's inventories. It also sued him for $40 million.

Khan countersued, alleging that Nissan Motor Acceptance canceled his financing only after the parent company suffered losses during the economic crisis and went on an international push to stanch red ink.

He also alleged that, until then, Nissan had encouraged him to expand. It also flew him to Tokyo to receive an award. However, the lawyers of Nissan countered that winning an award did not mitigate his selling out of trust. The jury agreed. [source: BusinessWire]

Topics: nissan

If you liked the article, share on:

Pin It

Comments

Recommended

The German automaker Volkswagen is now racing against time to come up with electric vehicles that will be able to pass Europe and China's stringent emission standard. The car company...
by - March 22, 2017
In the last few years, the advent of compact sedans and crossovers has become quite overwhelming. Even two of the major manufacturers that “started it all” have to admit that...
by - March 22, 2017
By 2020, Audi will be throwing out not just one but three fully-electric vehicles. One of which will be pitted against the BMW i8. This new information was revealed by...
by - March 22, 2017
Tesla confirms that they will be discontinuing the fairly new Model S 60 and 60D sedans as soon as next month. Why, you ask? The company wants to make enough...
by - March 22, 2017
Have you ever wondered how much luxury car companies profit from every vehicle they sell? And which companies profit more? Well, in 2016, Porsche sold over 238,000 vehicles. That is...
by - March 22, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries