MORGAN HILL
– A change of tactics is in store for the owner of a Gilroy Ford
dealership after the California Supreme Court denied his petition
to stop construction of another Ford dealership in Morgan Hill.
MORGAN HILL – A change of tactics is in store for the owner of a Gilroy Ford dealership after the California Supreme Court denied his petition to stop construction of another Ford dealership in Morgan Hill.
The new dealership will be built on Condit Road, just northeast of the U.S. 101/East Dunne Avenue interchange and less than 12 miles from Bob Lynch Ford at Monterey Street and Luchessa Avenue.
Scott Lynch, the Gilroy dealership’s owner, considers this too close to share the available business.
The original lawsuit stated that only one dealership would be left standing if the Ford Store is allowed to open.
“If the new dealership goes into operation, either it or Bob Lynch Ford will fail economically,” the suit claimed.
Lynch’s attorney Bruce Tichinin offered to drop the appeal if the owner of the Morgan Hill dealership and the city would agree not to sue Lynch for malicious prosecution, said Sean Absher, attorney for Tim Paulus, who owns the new dealership.
“We rejected the offer and intend to pursue these claims vigorously once the appeal is over,” Absher said in an e-mail Tuesday.
Tichinin confirmed making the offer but had his own opinion of malicious prosecution.
“They have absolutely no chance of winning a malicious prosecution case,” Tichinin said. “It would be malicious prosecution for them to sue, since we were asking for a decision supported by Supreme Court cases.”
Tichinin filed the original lawsuit in July 2003, claiming that building the Paulus Ford dealership constitutes unfair competition. He also claimed Morgan Hill officials overstepped their legal bounds when the city approved exceptions to zoning and city codes allowing the project.
Tichinin said Lynch has not decided whether to pursue the case further, but if he does, it will be directed at the financial deal the city made with Paulus and not at zoning variances.
“There is a significant threat to competition from the sweetheart deal, with the rebate of up to $1 million (over 10 years in sales taxes),” Tichinin said.
Tichinin said Lynch never sought money from the lawsuit but wants to halt the sales tax rebate and be able to compete on a level playing field.
“We have only sought to prevent unlawful construction and unlawful rebate,” he said. “We are seeking fair and lawful competition. What we hope to get is an invalidation of the city’s $1 million contract with Paulus.”
Lynch has no further plans to try to halt construction, Tichinin said.
“But don’t rule it out entirely.”
Lynch must file any appeal by June 28.
In the meantime, Absher said work continues on the Ford Store and should be completed before the end of the year.
Morgan Hill City Attorney Helene Leichter had no comment on the development.
Carol Holzgrafe covers City Hall for The Times. She can be reached by e-mail at ch********@mo*************.com or phoning (408) 779-4106 Ext. 201.
