1.1                          A bill for an act 
  1.2             relating to commerce; regulating motor vehicle sales 
  1.3             and distributions; specifying certain unfair 
  1.4             practices; amending Minnesota Statutes 1998, sections 
  1.5             80E.13; and 80E.17. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  Minnesota Statutes 1998, section 80E.13, is 
  1.8   amended to read: 
  1.9      80E.13 [UNFAIR PRACTICES BY MANUFACTURERS, DISTRIBUTORS, 
  1.10  FACTORY BRANCHES.] 
  1.11     It is unlawful and an unfair practice for a manufacturer, 
  1.12  distributor, or factory branch to engage in any of the following 
  1.13  practices:  
  1.14     (a) To delay, refuse, or fail to deliver new motor vehicles 
  1.15  or new motor vehicle parts or accessories in reasonable time and 
  1.16  in reasonable quantity relative to the new motor vehicle 
  1.17  dealer's facilities and sales potential in the dealer's relevant 
  1.18  market area, after having accepted an order from a new motor 
  1.19  vehicle dealer having a franchise for the retail sale of any new 
  1.20  motor vehicle sold or distributed by the manufacturer or 
  1.21  distributor, if the new motor vehicle or new motor vehicle parts 
  1.22  or accessories are publicly advertised as being available for 
  1.23  delivery or actually being delivered.  This clause is not 
  1.24  violated, however, if the failure is caused by acts or causes 
  1.25  beyond the control of the manufacturer; 
  2.1      (b) To refuse to disclose to any new motor vehicle dealer 
  2.2   handling the same line make, the manner and mode of distribution 
  2.3   of that line make within the relevant market area; 
  2.4      (c) To obtain money, goods, service, or any other benefit 
  2.5   from any other person with whom the dealer does business, on 
  2.6   account of, or in relation to, the transaction between the 
  2.7   dealer and the other person, other than for compensation for 
  2.8   services rendered, unless the benefit is promptly accounted for, 
  2.9   and transmitted to, the new motor vehicle dealer; 
  2.10     (d) To increase prices of new motor vehicles which the new 
  2.11  motor vehicle dealer had ordered for private retail consumers 
  2.12  prior to the dealer's receiving the written official price 
  2.13  increase notification.  A sales contract signed by a private 
  2.14  retail consumer shall constitute evidence of each order if the 
  2.15  vehicle is in fact delivered to that customer.  In the event of 
  2.16  manufacturer price reductions, the amount of any reduction 
  2.17  received by a dealer shall be passed on to the private retail 
  2.18  consumer by the dealer if the retail price was negotiated on the 
  2.19  basis of the previous higher price to the dealer; 
  2.20     (e) To offer any refunds or other types of inducements to 
  2.21  any new motor vehicle dealer for the purchase of new motor 
  2.22  vehicles of a certain line make without making the same offer to 
  2.23  all other new motor vehicle dealers in the same line make within 
  2.24  the relevant market area; 
  2.25     (f) To release to any outside party, except under subpoena 
  2.26  or in an administrative or judicial proceeding involving the 
  2.27  manufacturer or dealer, any business, financial, or personal 
  2.28  information which may be provided by the dealer to the 
  2.29  manufacturer, without the express written consent of the dealer 
  2.30  or unless pertinent to judicial or governmental administrative 
  2.31  proceedings or to arbitration proceedings of any kind; 
  2.32     (g) To deny any new motor vehicle dealer the right of free 
  2.33  association with any other new motor vehicle dealer for any 
  2.34  lawful purpose; 
  2.35     (h) To unfairly discriminate among its new motor vehicle 
  2.36  dealers with respect to warranty reimbursement or authority 
  3.1   granted its new vehicle dealers to make warranty adjustments 
  3.2   with retail customers; 
  3.3      (i) To compete with a new motor vehicle dealer in the same 
  3.4   line make operating under an agreement or franchise from the 
  3.5   same manufacturer in the relevant market area.  A manufacturer 
  3.6   shall not, however, be deemed to be competing when operating a 
  3.7   dealership, either temporarily or for a reasonable period, which 
  3.8   is for sale to any qualified independent person at a fair and 
  3.9   reasonable price, or when involved in a bona fide relationship 
  3.10  in which an independent person has made a significant investment 
  3.11  subject to loss in the dealership and can reasonably expect to 
  3.12  acquire full ownership of the dealership on reasonable terms and 
  3.13  conditions; 
  3.14     (j) To prevent a new motor vehicle dealer from receiving 
  3.15  fair and reasonable compensation for the value of the new motor 
  3.16  vehicle dealership.  There shall be no transfer, assignment of 
  3.17  the franchise, or major change in the executive management of 
  3.18  the dealership, except as is otherwise provided in sections 
  3.19  80E.01 to 80E.17, without consent of the manufacturer, which 
  3.20  shall not be unreasonably withheld.  Denial of the request must 
  3.21  be in writing and delivered to the new motor vehicle dealer 
  3.22  within 60 days after the manufacturer receives the information 
  3.23  necessary to evaluate the proposed transfer.  If a denial is not 
  3.24  sent within this period, the manufacturer shall be deemed to 
  3.25  have given its consent to the proposed transfer or change; 
  3.26     (k) To threaten to modify or replace or modify or replace a 
  3.27  franchise with a succeeding franchise that would adversely alter 
  3.28  the rights or obligations of a new motor vehicle dealer under an 
  3.29  existing franchise or that substantially impairs the sales or 
  3.30  service obligations or investments of the motor vehicle dealer; 
  3.31     (l) To unreasonably deny the right to acquire factory 
  3.32  program vehicles to any dealer holding a valid franchise from 
  3.33  the manufacturer to sell the same line make of vehicles, 
  3.34  provided that the manufacturer may impose reasonable 
  3.35  restrictions and limitations on the purchase or resale of 
  3.36  program vehicles to be applied equitably to all of its 
  4.1   franchised dealers.  For the purposes of this paragraph, 
  4.2   "factory program vehicle" has the meaning given the term in 
  4.3   section 80E.06, subdivision 2~~.~~; 
  4.4      (m) To discriminate in favor of a dealer in which a 
  4.5   manufacturer, distributor, or factory branch has a significant 
  4.6   ownership interest or is actively involved in the management and 
  4.7   operation by offering the dealer: 
  4.8      (1) new motor vehicles or new motor vehicle parts or 
  4.9   accessories at lower net prices, including discounts, rebates, 
  4.10  incentives, or other payments or allowances; 
  4.11     (2) new motor vehicles or new motor vehicle parts or 
  4.12  accessories in quantities and styles not reasonably related to 
  4.13  the dealer's facilities and sales potential in the relevant 
  4.14  market area; 
  4.15     (3) new motor vehicles or new motor vehicle parts or 
  4.16  accessories at more favorable delivery terms, including time of 
  4.17  delivery after placement of order; 
  4.18     (4) any promotional or advertising payment or allowance 
  4.19  that is not offered or made available to other dealers on 
  4.20  proportionally equal terms; 
  4.21     (5) the opportunity to enter into an arrangement to sell or 
  4.22  lease a dealership facility that is not offered or made 
  4.23  available to other dealers on terms proportionate to the values 
  4.24  of their facility; 
  4.25     (6) personal training not offered or made available to 
  4.26  other dealers on equal terms; 
  4.27     (7) inventory or other finance arrangements on more 
  4.28  favorable terms, except that no manufacturer, distributor, or 
  4.29  factory branch is obligated to provide financing to a dealer who 
  4.30  does not meet reasonable, uniformly applied credit standards; 
  4.31     (8) an opportunity to perform warranty service that is not 
  4.32  offered or made available to other dealers under uniformly 
  4.33  applied standards; 
  4.34     (9) an opportunity to obtain merchandise containing a 
  4.35  manufacturer's name, trade name, trademark, or other licensed 
  4.36  mark that is not offered or made available to other dealers on 
  5.1   proportionally equal terms; 
  5.2      (10) an opportunity to establish additional sales, service, 
  5.3   or parts facilities that is not offered or made available to 
  5.4   other dealers in the relevant market area; 
  5.5      (11) information concerning the products, prices, 
  5.6   promotional programs, or other terms of sale offered by the 
  5.7   manufacturer, distributor, or factory branch that is not 
  5.8   contemporaneously offered or made available to other dealers; 
  5.9      (12) any improvement to, or payment for improvement to, a 
  5.10  facility that is not offered or made available to other dealers 
  5.11  on proportionally equal terms; or 
  5.12     (13) any other product, assistance, payment, service, or 
  5.13  facility related to the new motor vehicle dealer franchise that 
  5.14  is not offered or made available to other dealers on 
  5.15  proportionally equal terms; 
  5.16     (n) It is not a defense to an alleged violation of 
  5.17  paragraph (m) that an item, payment, or opportunity was offered 
  5.18  to a dealer if the offer was conditioned upon the dealer meeting 
  5.19  one or more requirements which are not reasonable and necessary 
  5.20  to fulfill the dealer's obligations under the franchise.  The 
  5.21  manufacturer, distributor, or factory branch has the burden of 
  5.22  proving that any requirement upon which an offer was conditioned 
  5.23  was reasonable and necessary to fulfill the dealer's obligations 
  5.24  under the franchise when the offer was made.  No requirement is 
  5.25  reasonable and necessary to fulfill the dealer's obligations 
  5.26  under the franchise if the manufacturer cannot prove that it was 
  5.27  within the control of each dealer to meet the requirement 
  5.28  imposed on it as a condition of the offer; and 
  5.29     (o) Any dealer who alleges a good faith belief that it has 
  5.30  or is being discriminated against in violation of paragraph (m) 
  5.31  may demand in writing that the manufacturer, distributor, or 
  5.32  factory branch furnish it with pertinent information reasonably 
  5.33  necessary for the dealer to determine whether or not such 
  5.34  discrimination exists.  If the manufacturer, distributor, or 
  5.35  factory branch fails to furnish the dealer with the information 
  5.36  demanded within 30 days of the manufacturer's receipt of the 
  6.1   dealer's written demand, the manufacturer, distributor, or 
  6.2   factory branch shall have, in any subsequent legal proceeding, 
  6.3   the burden of proving that the alleged violation has not 
  6.4   occurred. 
  6.5      Sec. 2.  Minnesota Statutes 1998, section 80E.17, is 
  6.6   amended to read: 
  6.7      80E.17 [CIVIL REMEDIES.] 
  6.8      Notwithstanding the terms of any franchise agreement or 
  6.9   waiver to the contrary, any person whose business or property is 
  6.10  injured by a violation of sections 80E.01 to 80E.17, or any 
  6.11  person injured because of the refusal to accede to a proposal 
  6.12  for an arrangement which, if consummated, would be in violation 
  6.13  of sections 80E.01 to 80E.17, may bring a civil action to enjoin 
  6.14  further violations and to recover the actual damages sustained, 
  6.15  together with costs and disbursements, including reasonable 
  6.16  attorney's fees.  Any person injured by a violation of section 
  6.17  80E.13, paragraph (m), shall recover three times the actual 
  6.18  damages sustained, together with costs and disbursements, 
  6.19  including reasonable attorney's fees.