Miller Barondess Files Lawsuit Against Toyota on Behalf of Dealer as Covered by Law360

Miller Barondess Files Lawsuit Against Toyota on Behalf of Dealer as Covered by Law360

By Kat Greene, Law360, Thursday, July 27, 2017, Los Angeles – An Orange County Toyota dealer has filed a suit alleging the automaker shut down his recall notification software program and forced him out of owning a dealership, his attorneys said Thursday, all so the company could avoid paying for the influx of customers seeking repairs.

Roger Hogan, who owned dealerships in Claremont and San Juan Capistrano, California, said Toyota Motor Sales USA Inc. disabled a software Hogan had created called Autovation because the program was driving more customers into dealerships for recall-related repairs, increasing the company’s costs, according to his complaint in California state court.

Hogan said he’d created Autovation after Toyota’s major safety recalls over dangerous defects, such as unintended acceleration, as a way for Toyota dealers to send letters to customers who had not yet gotten their cars fixed. But the more customers were aware of safety recalls, the more Toyota was going to have to pay to fix the problems, he said.

“Toyota did not want Hogan’s program,” he said in his complaint. “So while Hogan was trying to protect Toyota customers and ensure their safety, Toyota was creating a plan to kill Autovation and get rid of Hogan as a dealer.”

The lawsuit, filed on Tuesday, alleged that Toyota sent out only one notice to customers when their vehicle was subject to a recall, and that many customers never even saw it. Toyota’s “antiquated” system also made it hard for dealers themselves to identify open recalls when customers brought in their vehicles for service, he said.

His Autovation software was aimed at solving that problem, and it was wildly successful, he said.

But it meant Toyota was required to pay for the extra safety recall work that was coming in. The company killed the Autovation program to avoid having to pay millions for repairs, and then went a step further to get rid of Hogan as a dealer, according to the suit.

Toyota told Hogan to create a succession plan for his dealerships, but rejected his sons for ownership and management positions. It then ordered him to buy more land at one dealership, but refused to send him the cars that extra land entitled him to. It cut him off from the vehicles he needed by allocating them to competing dealers or ignoring his requests, and would extend one of his dealership’s franchise agreements for only short periods of time to keep pressuring him, according to the suit.

Finally, Toyota told him to sell, he said.

Toyota was simultaneously putting corporate profits over customer safety and pushing Hogan and his dealerships to lose millions in revenues and value in retaliation for his software program, according to the suit.

“These are horrific facts,” Skip Miller of Miller Barondess LLP, who represents Hogan, said in a statement. “We look forward to our day in court and putting Toyota before a jury.”

A spokeswoman for Toyota declined to comment.

Hogan is represented by Louis R. Miller, Amnon Z. Siegel and Casey B. Pearlman of Miller Barondess LLP.

Counsel information for Toyota couldn’t be immediately determined.

The case is Roger Hogan et al. v. Toyota Motor Sales USA Inc., in the Superior Court of the State of California, County of Orange. Case number information couldn’t be immediately determined.