Vegas dealer’s fight with Lamborghini drags on

Grace Leong

Monday, July 23, 2001 | 9:46 a.m.

A legal settlement between Exclusive Inc. of Las Vegas, a former sole U.S. distributor of Lamborghini luxury cars in the United States and Mexico, and German automotive giant Volkswagen AG has hit a snag.

Exclusive, which agreed to relinquish its sole distributorship rights effective Dec. 31, sued Volkswagen-owned Automobili Lamborghini S.P.A. of Bologna, Italy, on June 29 to recover $1.302 million it claims to be owed because of Lamborghini's alleged breach of the settlement agreement.

The settlement, reached Dec. 1, is part of a global move by Automobili Lamborghini to phase out Lamborghini importers and distributors worldwide. Lamborghini said it began distributing its vehicles, parts and accessories directly from Italy to dealers in the United States effective Dec. 31.

The settlement also provided for the resolution of Exclusive's claims for reimbursements incurred by Exclusive to its dealers under Lamborghini's standard manufacturer's warranty, the sale of certain Lamborghini parts and accessories and cash payments by Lamborghini to Exclusive, owned by Vik Keuylian.

The Las Vegas distributor sued Automobili Lamborghini and its parent company, Volkswagen, in January 2000, alleging they tried to force Exclusive to relinquish its distributorship by shorting supplies of the luxury cars to Exclusive, refusing to pay receivables, harassing Exclusive's dealers and implementing payment procedures aimed at injuring Exclusive's relationship with its bank.

But Lamborghini's alleged failure to make all the required payments within the time frames stipulated in the December settlement and difficulties in implementing all the terms of the settlement led both parties to enter another agreement on March 19.

Exclusive, under the March agreement, was entitled to file a supplemental complaint before June 30 to enforce its claims should Lamborghini breach the settlement.

Exclusive, in its June 29 complaint, accused Lamborghini of sabotaging its attempts to resell up to 23 Lamborghini Diablo 6.0s luxury cars at an established retail price of $250,000 per vehicle to Exclusive's seven retail dealers when Lamborghini issued a letter on Dec. 21 to them offering the vehicles at $235,000 each.

Exclusive, which said this move was unauthorized because it occurred before Lamborghini was entitled to take over the distribution rights, said it lost profits from re-selling the automobiles at the established retail price after its dealers refused to honor their prior purchase orders.

Exclusive also said Lamborghini failed to pay Exclusive $225,733 in warranty reimbursements made to its dealers for parts replacement and labor and seeks to recover $77,130 in claims it said arose from unauthorized charges incurred between Dec. 1 and March 19.

Lamborghini hasn't yet responded to the allegations.