79549546.2-1569Virginia Decodedhttps://vacode.org2016Motor VehiclesDealers And Driver Training SchoolsMotor Vehicle DealersFranchisesOther coercion of dealers; transfer, grant, succession to and cancellation of dealer franchises; delivery of vehicles, parts, and accessories1988, c. 865, § 46.1-550.5:27; 1989, cc. 363, 686, 727; 1990, c. 83; 1992, c. 116; 1994, c. 385; 1995, cc. 767, 816; 1998, c. 682; 2007, cc. 827, 837; 2009, cc. 173, 176; 2010, cc. 284, 318; 2011, cc. 774, 856; 2015, cc. 155, 236; 2016, cc. 432, 534.Volkswagen of America, Inc. v. Smit022402587 S.E.2d 5262003-10-31https://www.courtlistener.com/opinion/1059161/volkswagen-of-america-inc-v-smit/ . . . distributor violated Code § 46.2-1569(7). We primarily consider whether Code § 46.2-1569(7) . . . <abbr title="Supreme Court of Virginia">SCV</abbr>Pence Holdings, Inc. v. Auto Center, Inc.Record No. 0007-94-2454 S.E.2d 7321995-02-21https://www.courtlistener.com/opinion/1350259/pence-holdings-inc-v-auto-center-inc/ . . . DMV) which denied Pence a hearing under Code § 46.2-1569(4). This appeal emanates from a May 28, . . . <abbr title="Court of Appeals">COA</abbr>Volkswagen of America, Inc. v. Quillian1947012569 S.E.2d 7442002-09-17https://www.courtlistener.com/opinion/1064489/volkswagen-of-america-inc-v-quillian/ . . . claims that (1) Code § 46.2-1569(7) is unconstitutionally vague, (2) Code § 46.2-1569(7) violates . . . <abbr title="Court of Appeals">COA</abbr>Volkswagen of America, Inc. v. Smit082305689 S.E.2d 6792010-02-25https://www.courtlistener.com/opinion/1058217/volkswagen-of-america-inc-v-smit/ . . . Inc. ("Volkswagen") violated Code § 46.2-1569(7) when it failed to supply certain . . . <abbr title="Supreme Court of Virginia">SCV</abbr>Priority Auto Group, Inc. v. Ford Motor Company13-16962014-07-30https://www.courtlistener.com/opinion/2716261/priority-auto-group-inc-v-ford-motor-company/ . . . myopically focuses on Virginia Code §§ 46.2- . . . Court of Appeals for the Fourth CircuitVolkswagen of America, Inc. v. Smit2961072667 S.E.2d 8172008-10-28https://www.courtlistener.com/opinion/1062636/volkswagen-of-america-inc-v-smit/ . . . of America, Inc. (Volkswagen) violated Code § 46.2-1569(7) when it failed to ship any newly . . . <abbr title="Court of Appeals">COA</abbr>Yamaha Motor Corp., USA v. Quillian021232571 S.E.2d 1222002-11-01https://www.courtlistener.com/opinion/1059271/yamaha-motor-corp-usa-v-quillian/ . . . the motor vehicle dealer provisions (Va. Code § 46.2-1569), but presumably the 10, 15 and 20 mile . . . <abbr title="Supreme Court of Virginia">SCV</abbr> . . . Peugeot Motors of America, Inc. v. Eastern Auto . . . 88-2598892 F.2d 3551990-02-27https://www.courtlistener.com/opinion/534211/peugeot-motors-of-america-inc-v-eastern-auto-distributors-inc-peugeot/Court of Appeals for the Fourth Circuit . . . Richard R. Woody Pinesbrook Motors, Incorporated v. General . . . 93-13319 F.3d 11071993-11-23https://www.courtlistener.com/opinion/657333/richard-r-woody-pinesbrook-motors-incorporated-v-general-motors/ . . . privileges its conduct. In particular, GM cites Sec. 46.2-1569(3), which provides that "[n]o . . . Court of Appeals for the Fourth CircuitNavistar, Inc. v. New Baltimore Garage, Inc.23431142012-08-14https://www.courtlistener.com/opinion/1061623/navistar-inc-v-new-baltimore-garage-inc/ . . . agreements must conform to the Code. See Code § 46.2-1569(9). Code . . . <abbr title="Court of Appeals">COA</abbr>http://law.lis.virginia.gov/vacode/46.2-1569//46.2-1569/46.2/IV/15/7/46.2-156946.2-1573Notwithstanding the terms of any franchise agreement, it shall be unlawful for any manufacturer, factory branch, distributor, distributor branch, or affiliate, or any field representative, officer, agent, or their representatives to do any of the following. It shall further be unlawful for any manufacturer, factory branch, distributor, distributor branch, or any field representative, officer, agent, or their representatives to engage in conduct prohibited under this section through an affiliate.section1 To coerce or attempt to coerce any dealer to accept delivery of any motor vehicle or vehicles, parts or accessories therefor, or any other commodities, which have not been ordered by the dealer.section112 To coerce or attempt to coerce any dealer to join, contribute to, or affiliate with any advertising association.section2a2a2 To coerce or require any dealer to establish in connection with the sale of a motor vehicle prices at which the dealer shall sell products or services not manufactured or distributed by the manufacturer, factory branch, distributor, or distributor branch, whether by agreement, program, incentive provision, or otherwise.section2b2b2 To coerce or require any dealer, whether by agreement, program, incentive provision, or otherwise, to construct improvements to its facilities or to install new signs or other franchisor image elements that replace or substantially alter those improvements, signs, or franchisor image elements completed within the preceding 10 years that were required or approved by the manufacturer, factory branch, distributor, or distributor branch or one of its affiliates. If a manufacturer, factory branch, distributor, or distributor branch offers incentives, or other payments under a program offered after the effective date of this subdivision and available to more than one dealer in the Commonwealth that are premised wholly or in part on dealer facility improvements or installation of franchisor signs or other franchisor image elements, a dealer that constructed improvements or installed signs or other franchisor image elements required by or approved by the manufacturer, factory branch, distributor, or distributor branch and completed within the 10 years preceding the program shall be deemed to be in compliance with the program requirements pertaining to construction of facilities or installation of signs or other franchisor image elements that would replace or substantially alter those previously constructed or installed within that 10-year period. This subdivision shall not apply to a program that provides lump sum payments to assist dealers in making facility improvements or to pay for signs or franchisor image elements when such payments are not dependent on the dealer selling or purchasing specific numbers of new vehicles and shall not apply to a program that is in effect with more than one dealer in the Commonwealth on the effective date of this subdivision, nor to any renewal or modification of such a program.section2c2c2 Failure of the franchised motor vehicle dealer to conduct its customary sales and service operations during its posted business hours for seven consecutive business days, except where the failure results from acts of God or circumstances beyond the direct control of the franchised motor vehicle dealer.section5b5b3 Revocation of any license which the franchised motor vehicle dealer is required to have to operate a dealership.section5c5c3 Conviction of the dealer or any principal of the dealer of a felony.The change or discontinuance of a marketing or distribution system of a particular line-make product by a manufacturer or distributor, while the name identification of the product is continued in substantial form by the same or a different manufacturer or distributor, may be considered to be a franchise termination, cancellation, or nonrenewal. The provisions of this paragraph shall apply to changes and discontinuances made after January 1, 1989, but they shall not be considered by any court in any case in which such a change or discontinuance occurring prior to that date has been challenged as constituting a termination, cancellation or nonrenewal.section5d5d3 To fail to provide continued parts and service support to a dealer which holds a franchise in a discontinued line-make for at least five years from the date of such discontinuance. This requirement shall not apply to a line-make which was discontinued prior to January 1, 1989.section5a5a2 Upon the involuntary or voluntary termination, nonrenewal, or cancellation of the franchise of any dealer, by either the manufacturer, distributor, or factory branch or by the dealer, notwithstanding the terms of any franchise whether entered into before or after the enactment of this section, to fail to pay the dealer for at least the following:
section5b5b2 The dealer cost as shown in the price catalog of the franchisor current at the time of repurchase of each new, unused, undamaged, and unsold part or accessory if such part or accessory is in the current parts catalog and is still in the original, resalable merchandising package and in unbroken lots, except that in the case of sheet metal, a comparable substitute for the original package may be used;section5b(25b(23 The fair market value of each undamaged sign owned by the dealer that bears a trademark, trade name or commercial symbol used or claimed by the franchisor if such sign was purchased from or at the request of the franchisor;section5b(35b(33 The fair market value of all special tools and automotive service equipment owned by the dealer that were recommended and designated as special tools or equipment by the franchisor, if the tools and equipment are in usable and good condition, normal wear and tear excepted; andsection5b(45b(43 To fail to provide to a dealer, when the manufacturer, factory branch, distributor, or distributor branch claims that a vendor chosen by the dealer cannot supply goods and services of substantially similar quality, a disclosure concerning the vendor selected, identified, or designated by the franchisor stating (i) whether the manufacturer, factory branch, distributor, distributor branch, or one of its affiliates, or any officer, director, or employee of the same, has an ownership interest, actual or beneficial, in the vendor and, if so, the percentage of the ownership interest and (ii) whether the manufacturer, factory branch, distributor, distributor branch, or one of its affiliates has an agreement or arrangement by which the vendor pays to the manufacturer, factory branch, distributor, distributor branch, or one of its affiliates, or any officer, director, or employee of the same, any compensation and, if so, the basis and amount of the compensation to be paid as a result of any purchases by the dealer, whether it is to be paid by direct payment by the vendor or by credit from the vendor for the benefit of the recipient.section7e7e2 To fail to provide to a dealer, if the goods and services to be supplied to the dealer by a vendor selected, identified, or designated by the manufacturer, factory branch, distributor, or distributor branch are signs or other franchisor image elements to be leased to the dealer, the right to purchase the signs or other franchisor image elements of like kind and quality from a vendor selected by the dealer. If the vendor selected by the manufacturer, factory branch, distributor, or distributor branch is the only available vendor, the dealer must be given the opportunity to purchase the signs or other franchisor image elements at a price substantially similar to the capitalized lease costs thereof. This subdivision shall not be construed to allow a dealer to impair or eliminate the intellectual property rights of the manufacturer, factory branch, distributor, or distributor branch, nor to permit a dealer to erect or maintain signs that do not conform to the intellectual property usage guidelines of the manufacturer, factory branch, distributor, or distributor branch.section7f7f2 To include in any franchise with a motor vehicle dealer terms that are contrary to, prohibited by, or otherwise inconsistent with the requirements of this chapter.section882 For any franchise agreement, to require a motor vehicle dealer to pay the attorney fees of the manufacturer or distributor related to hearings and appeals brought under this article.section8a8a2