09-003024 Galaxy Powersports, Llc, D/B/A Jcl International, Llc And J And F South Florida Investments, Inc., D/B/A Treasure Coast Scooters And Things vs. Wenmark, Inc. D/B/A All The Wheel Toys Status: Closed Recommended Order on Monday, November 2, 2009.

Summary: Petitioner failed to prove that the existing dealership is inadequately representing the same line make in the territory.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

GALAXY POWERSPORTS, LLC d/b/a )

JCL INTERNATIONAL, LLC, AND )

J & F SOUTH FLORIDA )

INVESTMENTS, INC. d/b/a )

TREASURE COAST SCOOTERS AND )

THINGS, )

)

Petitioners, )

) Case No. 09-3010

vs. )

)

WENMARK, INC. d/b/a ALL THE )

WHEEL TOYS, )

)

Respondent. ) )

)

GALAXY POWERSPORTS, LLC, d/b/a JCL INTERNATIONAL, LLC AND J )

AND F SOUTH FLORIDA )

INVESTMENTS, INC., d/b/a )

TREASURE COAST SCOOTERS AND )

THINGS, )

)

)

Petitioners, )

)

vs. ) Case No. 09-3024

)

WENMARK, INC., d/b/a ALL THE )

WHEEL TOYS, )

)

Respondent. )

_______________________________

RECOMMENDED ORDER

As previously scheduled, a final hearing was held on

October 6, 2009, at video teleconference sites in Fort Pierce

and Tallahassee, Florida, before Administrative Law Judge

Eleanor M. Hunter of the Division of Administrative Hearings

(DOAH).

APPEARANCES

For Petitioners: Galaxy Powersports LLC d/b/a

JCL International, LLC; and

For Petitioner: Guy Young, pro se

J & F South Florida Investments, Inc.

d/b/a Treasure Coast Scooters and Things:

7320 South US 1

Port St. Lucie, Florida 34952

For Respondent: Mark Mourning, pro se

WenMark Inc., d/b/a All The

Wheel Toys

1540 Northwest Federal Highway

Stuart, Florida 34994

STATEMENT OF THE ISSUE

The issue is whether the Petitioners' proposal for a dealer

to sell two new lines of motorcycles should be approved.

PRELIMINARY STATEMENT

Galaxy Powersports, LLC d/b/a JCL International LLC

(Galaxy) published two separate “Notices of Publication for a

New Point Franchise Motor Vehicle Dealer in a County of More

than 300,000 Population” in the Florida Administrative Weekly on

October 10, 2008. The notices stated an intent to permit J & F

South Florida Investments, Inc. d/b/a Treasure Coast Scooters

and Things (Treasure Coast) to sell two separate lines of

motorcycles. On October 16, 2008, Respondent, WenMark Inc.,

d/b/a All The Wheel Toys, timely filed challenges to having the

dealership sell both line-makes.

The Florida Department of Highway Safety and Motor Vehicles

(the Department) forwarded that challenges to DOAH on June 3,

2009, and assigned DOAH Case Nos. 09-3010 and 09-3024. At the

request of the parties, the cases were consolidated for hearing.

Initially set for August 27, 2009, at the request of Guy Young,

the hearing was rescheduled for October 6, 2009.

At the hearing, Petitioner presented the testimony of

Mr. Young. Respondent presented the testimony of Mark Mourning

and subsequently filed a 13-page Composite Exhibit, which was

received into evidence.

A Transcript of the proceeding was not filed, as allowed on

or before October 20, 2009. Neither party filed a proposed

order, as they were permitted to do up to and including

October 28, 2009.

FINDINGS OF FACT

1. On October 10, 2008, in the Florida Administrative

Weekly, Volume 34, Number 41, two separate Notices of

Publication for a New Point Franchise Motor Vehicle Dealer in a

County of More than 300,000 Population were published.

2. The first notice provided, in relevant part, as

follows:

Pursuant to Section 320.642, Florida

Statutes, notice is given that [Galaxy]

intends to allow the establishment of

[Treasure Coast] as a dealership for the

sale of motorcycles manufactured by Taizhou

Zhongneng Motorcycle Co. Ltd. (ZHNG) at 7320

South U.S. 1, Port St. Lucie (St. Lucie

County) Florida 34952 on or after

September 26, 2008.

3. The second notice provided, in relevant part, as

follows:

Pursuant to Section 320.642, Florida

Statutes, notice is given that [Galaxy]

intends to allow the establishment of

[Treasure Coast] as a dealership for the

sale of motorcycles manufactured by Zhejiang

Taizhou Wangye Power Co. Ltd (ZHEJ) at 7320

South U.S. 1, Port St. Lucie (St. Lucie

County) Florida 34952 on or after September

26, 2008.

4. On October 16, 2008, Respondent filed the following

letters of protest with the Department of Highway Safety and

Motor Vehicles:

In regards to the intent of [Galaxy] to

establish a Taizhou Zhongneng Motorcycle Co.

Ltd. (ZHNG) with [Treasure Coast] for the

sale of motorcycles at 7320 South U.S. 1,

Port St. Lucie, Fl [sic] 34952. This letter

represents a written complaint to their

application for this dealership, because we

already represent said dealership.

and

In regards to the intent of [Galaxy] to

establish a Zhejiang Taizhou Wangye Power

Co. Ltd (ZHEJ) with [Treasure Coast] for the

sale of motorcycles at 7320 South U.S. 1,

Port St. Lucie, Fl [sic] 34952. This letter

represents a written complaint to their

application for this dealership, because we

already represent said dealership.

5. Both letters made the following additional

representations:

1. The proposed dealership would be within

20 miles of our dealership, as measured by

straight line distance. They are 8.61 miles

away per mapquest.

2. The proposed dealership is to be located

within the contractual area outlined in our

dealer agreement, as we have a 20 mile

exclusivity.

3. We have made more than 25% of our retail

sales to persons whose registered household

addresses are within 20 straight line miles

of the proposed dealership during the past

12 month period.

6. By letter dated October 22, 2008, the Department

apparently tried to refer this matter to DOAH. For reasons that

were not explained, however, this matter was not received at

DOAH until it was referred again by letter dated June 3, 2009.

7. The protest filed by Respondent was timely.

8. The parties agreed that the population of St. Lucie

County is over 300,000, and that Respondent's dealership is 8.61

miles from the proposed site.

9. Respondent has dealer agreements to sell various lines

of motorcycles, including motorcycles manufactured by Zhejiang

Taizhou Wangye Power Co., Ltd. (ZHEJ); and motorcycles

manufactured by Taizhou Zhongneng Motorcycle Co. Ltd. (ZHNG).

10. At the hearing, Mr. Young agreed that the evidence

showed that, as a dealer for Zhejiang Taizhou Wangye Power Co.

Ltd. (ZHEJ), Respondent has adequately promoted that line and

has made 25 percent or more of its retail sales to household

addresses within 12.5 miles of the proposed dealership.

11. At the hearing, Mr. Young said that the only

motorcycles at issue were those manufactured by Taizhou

Zhongneng Motorcycle Co. Ltd. (ZHNG). Specifically, he

questioned whether the line represented sufficient numbers of

sales within the territory.

12. Mr. Mourning explained that the ZHNG line was also

called ZNEN before 2009. He produced records that confirm that

Taizhou Zhongneng Motorcycle Co. Ltd., used ZNEN as the make of

its vehicles in 2008. Taken together, his sales records for

ZHNG and ZNEN motorcycles demonstrated that he also adequately

and successfully represents that line in the territory.

CONCLUSIONS OF LAW

13. The Division of Administrative Hearings has

jurisdiction over the parties to and the subject matter of these

proceedings. §§ 120.569, and 120.57(1), Fla. Stat (2008).

14. Section 320.605, Florida Statutes (2008), provides:

It is the intent of the Legislature to

protect the public health, safety, and

welfare of the citizens of the state by

regulating the licensing of motor vehicle

dealers and manufacturers, maintaining

competition, providing consumer protection

and fair trade and providing minorities with

opportunities for full participation as

motor vehicle dealers.

15. Section 320.642, Florida Statutes (2008), provides, in

pertinent part:

(1) Any licensee who proposes to

establish an additional motor vehicle

dealership or permit the relocation of an

existing dealer to a location within a

community or territory where the same line-

make vehicle is presently represented by a

franchised motor vehicle dealer or dealers

shall give written notice of its intention

to the department. Such notice shall state:

(a) The specific location at which the

additional or relocated motor vehicle

dealership will be established.

(b) The date on or after which the

licensee intends to be engaged in business

with the additional or relocated motor

vehicle dealer at the proposed location.

(c) The identity of all motor vehicle

dealers who are franchised to sell the same

line-make vehicle with licensed locations in

the county or any contiguous county to the

county where the additional or relocated

motor vehicle dealer is proposed to be

located.

(d) The names and addresses of the

dealer-operator and principal investors in

the proposed additional or relocated motor

vehicle dealership.

Immediately upon receipt of such notice

the department shall cause a notice to be

published in the Florida Administrative

Weekly. The published notice shall state

that a petition or complaint by any dealer

with standing to protest pursuant to

subsection (3) must be filed not more than

30 days from the date of publication of the

notice in the Florida Administrative Weekly.

The published notice shall describe and

identify the proposed dealership sought to

be licensed, and the department shall cause

a copy of the notice to be mailed to those

dealers identified in the licensee's notice

under paragraph (c).

(2)(a) An application for a motor vehicle

dealer license in any community or territory

shall be denied when:

1. A timely protest is filed by a

presently existing franchised motor vehicle

dealer with standing to protest as defined

in subsection (3); and

2. The licensee fails to show that the

existing franchised dealer or dealers who

register new motor vehicle retail sales or

retail leases of the same line-make in the

community or territory of the proposed

dealership are not providing adequate

representation of such line-make motor

vehicles in such community or territory.

The burden of proof in establishing

inadequate representation shall be on the

licensee.

* * *

(3) An existing franchised motor vehicle

dealer or dealers shall have standing to

protest a proposed additional or relocated

motor vehicle dealer where the existing

motor vehicle dealer or dealers have a

franchise agreement for the same line-make

vehicle to be sold or serviced by the

proposed additional or relocated motor

vehicle dealer and are physically located so

as to meet or satisfy any of the following

requirements or conditions:

* * *

(b) If the proposed additional or

relocated motor vehicle dealer is to be

located in a county with a population of

more than 300,000 according to the most

recent data of the United States Census

Bureau or the data of the Bureau of Economic

and Business Research of the University of

Florida:

1. Any existing motor vehicle dealer or

dealers of the same line-make have a

licensed franchise location within a radius

of 12.5 miles of the location of the

proposed additional or relocated motor

vehicle Dealer. . . . (Emphasis added.)

16. Respondent established as a matter of law that it has

standing to protest the proposed dealership's sale of the two

new line-makes.

17. Petitioners waived at the formal hearing the notice of

intent to sell and, therefore, its challenge to the adequacy of

Respondent's sales and representation for line-makes of

motorcycles manufactured by Zhejiang Taizhou Wangye Power Co.

Ltd. (ZHEJ).

18. Petitioners presented no credible evidence to support

a conclusion that the Respondent has not provided adequate

representation of Taizhou Zhongneng Motorcycle Co. Ltd. (ZHNG)

in the community or territory surrounding the proposed site. To

the contrary, the evidence established that Respondent has

provided adequate representation for the manufacture of the

line-make, ZHNG, that was also previously called the ZHEN line-

make.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that the Florida Department of Highway

Safety and Motor Vehicles enter a Final Order denying Treasure

Coast's applications to become the licensee to sell motorcycles

line-makes manufactured by Zhejiang Taizhou Wangye Power Co.

Ltd. (ZHEJ); and by Taizhou Zhongneng Motorcycle Co. Ltd. (ZHNG)

at the proposed site.

DONE AND ENTERED this 2nd day of November, 2009, in

Tallahassee, Leon County, Florida.

S

ELEANOR M. HUNTER

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

[phone]

Fax Filing [phone]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 2nd day of November, 2009.

COPIES FURNISHED :

Electra Theodorides-Bustle, Executive Director

Department of Highway Safety and

Motor Vehicles

4052 Bald Cypress Way, BIN A02

Tallahassee, Florida 32399-1701

Robin Lotane, General Counsel

Department of Highway Safety and

Motor Vehicles

Neil Kirkman Building

2009 Apalachee Parkway

Tallahassee, Florida 32399-0500

Guy Young

J & F South Florida Investments, Inc.

d/b/a Treasure Coast Scooters and Things

7320 South US 1

Port St. Lucie, Florida 34952

Mark Mourning

WenMark Inc., d/b/a All The Wheel Toys

1540 Northwest Federal Highway

Stuart, Florida 34994

Jennifer Clark, Esquire

Department of Highway Safety

and Motor Vehicles

Neil Kirkman Building, Room A-308

2900 Apalachee Parkway

Tallahassee, Florida 32399-0635

Leo Su

Galaxy Powersports, LLC, d/b/a

JCL International, LLC

2667 Northhaven Road

Dallas, Texas 75229

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.