United States District Court, D. Colorado
DC AUTOMOTIVE, INC. d/b/a Arapahoe Kia, a Colorado corporation, and SLT GROUP VI, INC. d/b/a Peak Kia, a Colorado corporation, Plaintiffs,
KIA MOTORS AMERICA, INC., a California corporation, Defendant.
A. BRIMMER CHIEF UNITED STATES DISTRICT JUDGE
matter comes before the Court on Defendant's Motion for
Summary Judgment [Docket No. 21]. The Court has jurisdiction
pursuant to 28 U.S.C. § 1332.
case arises out of a dispute over the potential establishment
of a new car dealership in Denver, Colorado. Defendant Kia
Motors America is the North American distributor of Kia
vehicles. Docket No. 21 at 3, ¶ 1. In this role,
defendant appoints entities as dealers, who sell Kia vehicles
directly to customers. Plaintiff Peak Kia was appointed as a
Kia dealer in 2003; plaintiff Arapahoe Kia was appointed as a
Kia dealer in 2008. Id. at 4, ¶¶ 3-4. Both
plaintiffs signed a standard “Kia Dealer Sales and
Service Agreement” (the “dealer agreement”)
at the time of their appointment. Id., ¶ 5. The
dealer agreement “expressly reserves” for
defendant “the unrestricted right . . . to grant others
the right to sell Kia [p]roducts, ” notes that
plaintiffs are “not being granted an exclusive right to
sell Kia [p]roducts in any specified geographic area, ”
and states that defendant “may add new dealers to,
relocate dealers into or remove dealers from” the
geographic area “[a]s permitted by applicable
law.” Id., ¶¶ 7-9. On October 19,
2018, defendant sent letters to plaintiffs, notifying them
that defendant intended to appoint a new dealer (the
“proposed dealership”) at 1260 S. Colorado
Boulevard in Denver, Colorado. Id., ¶ 10.
Plaintiffs are located more than five miles away from the
proposed dealership. Id. at 5, ¶ 11.
January 15, 2019, plaintiffs initiated this lawsuit in the
District Court for the City and County of Denver, Colorado.
Docket No. 1-2. Plaintiffs allege that defendant's plan
to establish the proposed dealership violates Colo. Rev.
Stat. § 44-20-125, a statute which creates a private
right of action for “[a]n existing motor vehicle dealer
adversely affected by” a distributor's plan to
reopen, relocate, or establish a “same line-make motor
vehicle dealer” to file suit to “prevent or
enjoin” the establishment of the proposed motor vehicle
dealer. Colo. Rev. Stat. § 44-20-125(5)(a). Plaintiffs
bring three claims for relief: (1) injunctive relief for a
violation of Colo. Rev. Stat. § 44-20-125, restraining
defendant from establishing the proposed dealership; (2)
damages for a violation of Colo. Rev. Stat. § 44-20-125;
and (3) damages for breach of the implied covenant of good
faith and fair dealing. Docket No. 1-2 at 7-10, ¶¶
52-78. On February 6, 2019, defendant timely removed the case
to this Court. Docket No. 1.
judgment is warranted under Federal Rule of Civil Procedure
56 when the “movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56(a);
see Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
248-50 (1986). A disputed fact is “material” if
under the relevant substantive law it is essential to proper
disposition of the claim. Wright v. Abbott Labs.,
Inc., 259 F.3d 1226, 1231-32 (10th Cir. 2001). Only
disputes over material facts can create a genuine issue for
trial and preclude summary judgment. Faustin v. City
& Cty. of Denver, 423 F.3d 1192, 1198 (10th Cir.
2005). An issue is “genuine” if the evidence is
such that it might lead a reasonable jury to return a verdict
for the nonmoving party. Allen v. Muskogee, 119 F.3d
837, 839 (10th Cir. 1997).
“the moving party does not bear the ultimate burden of
persuasion at trial, it may satisfy its burden at the summary
judgment stage by identifying a lack of evidence for the
nonmovant on an essential element of the nonmovant's
claim.” Bausman v. Interstate Brands Corp.,
252 F.3d 1111, 1115 (10th Cir. 2001) (internal quotation
marks omitted) (quoting Adler v. Wal-Mart Stores,
Inc., 144 F.3d 664, 671 (10th Cir. 1998)). “Once
the moving party meets this burden, the burden shifts to the
nonmoving party to demonstrate a genuine issue for trial on a
material matter.” Concrete Works of Colo., Inc. v.
City & Cty. of Denver, 36 F.3d 1513, 1518 (10th Cir.
1994). The nonmoving party may not rest solely on the
allegations in the pleadings, but instead must designate
“specific facts showing that there is a genuine issue
for trial.” Celotex Corp. v. Catrett, 477 U.S.
317, 324 (1986) (internal quotation marks omitted). “To
avoid summary judgment, the nonmovant must establish, at a
minimum, an inference of the presence of each element
essential to the case.” Bausman, 252 F.3d at
1115. When reviewing a motion for summary judgment, a court
must view the evidence in the light most favorable to the
non-moving party. Id.
moves for summary judgment on all three of plaintiffs'
claims. Docket No. 21.
Injunctive Relief Under Colo. Rev. Stat. §
argues that plaintiffs lack “standing” to assert
their claim for injunctive relief under Colo. Rev. Stat.
§ 44-20-125. Docket No. 21 at 7-15.
The Statutory Scheme
Colorado Dealer Act (“CDA”), Colo. Rev. Stat.
§ 44-20-101 et seq., regulates the “sale
and distribution of motor vehicles” in Colorado,
including the relationship between manufacturers,
distributors, and dealers of motor vehicles and the general
public. Colo. Rev. Stat. § 44-20-101(a). As relevant
here, the CDA requires any manufacturer seeking to
“establish an additional motor vehicle dealer, reopen a
previously existing motor vehicle dealer, or authorize an
existing motor vehicle dealer to relocate” to provide
at least sixty days notice to all of its existing dealers
“within whose relevant market area the new, reopened,
or relocated dealer would be located.” Colo. Rev. Stat.
§ 44-20-125(1). Within ninety days of receipt of notice
from the manufacturer, an existing dealer who is
“adversely affected” by the new dealer may file a
legal action or administrative complaint to “prevent or
enjoin” the new dealer. Id., §
44-20-125(5)(a). An existing dealer is adversely affected if
it is “located within the relevant market area”
of the new dealer. Id., § 44-20-125(5)(a)(I).
August 9, 2017, the CDA defined “relevant market
area” as the greater of “[t]he geographic area of
responsibility defined in the franchise agreement of an
existing dealer” and “[t]he geographic area
within a radius of five miles of any existing dealer of the
same line-make of vehicle that is located in a county with a
population of more than [150, 000] or within a radius of ten
miles . . . in a county with a population of [150, 000] or
less.” Id. § 12-6-120.3(3)(b)
(2016). Effective August 9, 2017, the statute was
amended to define the “relevant market area” as
the greater of “[t]he geographic area of responsibility
defined in the franchise agreement of an existing
dealer” and “[t]he geographic area within a
radius of ten miles of any existing dealer of the same
line-make of vehicle as the proposed additional motor vehicle
dealer.” Id., § 44-20-125(4)(b) (the
“2017 amendment”). Defendant represents, and
plaintiffs do not otherwise contend, that plaintiffs are
located in counties which have a population in excess of 150,
000. See Docket No. 21 at 6. In the complaint,
plaintiffs represent that they are located more than five
miles but less than ten miles from the proposed dealership
site. See Docket No. 1-2 at 6, ¶ 34. Thus, the
effect of the 2017 amendment was to expand the
“relevant market area” of both plaintiffs to
include the proposed dealership site.
Effect of ...