A federal decide in California has issued a preliminary injunction in favor of Kia America Inc. and in opposition to the would-be vendor and purported purchaser of a dealership in Palmdale.
U.S. District Judge James Selna discovered a chance of client confusion if franchisee Rally Auto Group and would-be purchasers Alam Khan and his Dalia Auto Group proceed to make use of Kia’s trademark and different mental property.
“The preliminary injunction means that the Dalia defendants are prohibited from continuing to operate the dealership,” mentioned James Mulcahy, a franchise regulation professional in Irvine, Calif., who is just not concerned within the litigation.
Defense lawyer Victor Danhi mentioned, “Despite the successful sale of its GMC, Cadillac, Buick, Hyundai and Genesis franchises to Dalia Auto Group, with the consent of those manufacturers — including Hyundai Motor Co., Kia’s parent company — Kia withheld its consent to the sale of Rally Kia to Dalia Auto Group, a successful dealership group owned and operated by Alam Khan.”
Danhi, of San Francisco, mentioned: “Nothing in the court’s ruling requires Rally Auto Group to close or otherwise suspend its Rally Kia dealership operations. Rally Auto Group continues to operate the dealership under its Kia dealer sales and service agreement.”
As Automotive News reported Feb. 7, Kia America twice rejected Rally Auto Group’s request to promote the belongings of its retailer to Khan and Dalia, saying their software failed to say Khan’s “previous unsatisfactory ownership” of one other Kia retailer.