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Danvers Motor Co. Inc. v. Ford Motor Co.

December 19, 2005

DANVERS MOTOR CO., INC., A MASSACHUSETTS CORPORATION; BOB CHAMBERS FORD, D/B/A AUGUSTA FORD, A MAINE CORPORATION; CONCORD FORD-LINCOLN-MERCURY, A NEW YORK CORPORATION; FETTE FORD INC., A NEW JERSEY CORPORATION; SENATOR FORD, INC., A DELAWARE CORPORATION; ROSEVILLE MIDWAY FORD COMPANY, A MINNESOTA CORPORATION; FULLERS' WHITE MOUNTAIN MOTORS, AN ARIZONA CORPORATION; CONDON FORD, INC., AN IOWA CORPORATION; G. & S. MANAGEMENT CORPORATION, D/B/A TILTON FORD, A NEW HAMPSHIRE CORPORATION, ON BEHALF OF THEMSELVES AND ALL OTHERS SIMILARLY SITUATED, APPELLANTS
v.
FORD MOTOR COMPANY



ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW JERSEY (Dist. Ct. No. 02-CV-02197) District Court Judge: Hon. John W. Bissell, Chief Judge.

The opinion of the court was delivered by: Alito, Circuit Judge

PRECEDENTIAL

Argued: July 15, 2005

Before: ALITO, VAN ANTWERPEN, and ALDISERT, Circuit Judges

OPINION OF THE COURT

Eight automobile dealers appeal the District Court's dismissal of their claims against the Ford Motor Company for lack of standing. Because their complaint alleges concrete and particularized injuries that are fairly traceable to Ford's behavior and redressable in court, we reverse and remand.

I.

In November 2000, a putative nationwide class of Ford dealers brought suit, claiming that Ford's recently introduced Blue Oval Program ("BOP") violated state and federal law. A District Court dismissed the case without prejudice for lack of standing. Danvers Motor Co. v. Ford Motor Co., 186 F. Supp. 2d 530 (D.N.J. 2002) ("Danvers I").

Instead of appealing Danvers I, the Plaintiffs revised their complaint and filed it anew on May 6, 2002. Ford responded with a motion to dismiss, which prompted Plaintiffs' latest effort, an "amended and supplemented" complaint filed on January 7, 2003. In an unpublished opinion we will call Danvers II, the District Court held that eight of the nine named Plaintiffs "do not yet have an injury that will support constitutional standing." Joint Appendix ("App.") at 24. The ninth Plaintiff is not a party to this appeal.

A.

"When reviewing an order of dismissal for lack of standing, we accept as true all material allegations of the complaint and construe them in favor of the plaintiff." Conte Bros. Automotive, Inc. v. Quaker State-Slick 50, Inc., 165 F.3d 221, 224 (3d Cir. 1998). We therefore relate the facts as alleged in the Plaintiffs' complaint.

Plaintiffs sell Ford automobiles in accordance with "the terms of a standard Ford Franchise Agreement." Complaint ¶¶ 33--36. They claim that Ford's BOP "is part of a coordinated objective to control and micromanage all Ford dealerships." Id. ¶ 42. Ford describes its BOP, introduced in April 2000, as a nationwide customer service and satisfaction incentive program designed to improve dealer performance. It is technically voluntary, but every Ford dealer is forced to bear the costs of the program, while only those who are "BOP certified" may reap its benefits. All eight dealers on appeal have been certified.*fn1

In order to finance its BOP, Ford charges an additional 1% for its automobiles, leaving the Manufacturer's Suggested Retail Price unchanged. When dealers sell the vehicles, Ford essentially reimburses them by giving them a "bonus" of 1.25% if the dealers met the initial certification requirements by April 17, 2001. The bonus drops to 1% if the dealer applied on or after April 1, 2001, and achieved certification prior to April 1, 2002. Ford originally planned to drop the bonus to .75% in April 2004, and to .5% in 2005, but it has since abandoned this plan. See App. at 77.

Certification entitles dealers to a number of benefits beyond these reimbursements. According to the complaint, dealers also receive 10% transportation assistance allowance bonuses; 50% discounts on all retail invoice messages; 401K plans for dealers' employees; access to the Blue Oval ...


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