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US Dealer Accuses Nissan of Destroying His Business

One of the biggest Nissan dealers in the US filled a $250 million fraud and breach of contract lawsuit against Nissan Motor Co, Nissan North America, Inc and Nissan Motor Acceptance Corp.

According to the lawsuit, “despite its prior promises and agreements to provide Kahn with the funding necessary to support the Dealerships through 2009 so Kahn could survive the economic crisis. Kahn believed Nissan, relied on its promises and was induced and deceived.”

Nissan was sued by Michael Kahn, a business man from Orange County, and Superior Automotive Group LLC. Nissan is charged with destroying the dealer, which became one of the most successful in the country, as it generated more than $500 million in revenues and employed 800 people.

“Kahn was Nissan’s ‘go-to’ dealer in California. At the behest of Nissan, he acquired troubled or underperforming dealerships and turned them around. When a large automotive company sought to buy out Kahn in 2004 and again in late 2006, Nissan insisted that he not sell and told Kahn he was a key component of Nissan’s future plans in California.”

“As the economy fell into a recession in 2008, the auto industry was hit hard. Nissan saw its sales in the U.S. plummet,”
the lawsuit states. “Nissan laid off tens of thousands of workers and drastically cut back vehicle production. In February 2009, Nissan reported a loss of approximately $800 million in the prior three months and slashed its workforce by 20,000.

“That same month (February), despite Nissan agreeing to a debt forbearance period through March 31, 2009, and despite Kahn’s long history of profitability and success with Nissan, Nissan precipitously cut off financing to Kahn and forced all his dealerships out of business,”
the lawsuit states.
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