Kia dealership sues LMP Automotive following failed acquisition

A Connecticut Kia dealership this week sued LMP Automotive Holdings Inc., alleging breach of contract and looking for $100,000 in deposits held in the failed acquisition. But a law firm for the dealership explained a resolution could previously be in the operates.

K & W Enterprises and Ash Road Holdings sued LMP and Initial American Title Insurance plan Co. in federal court in Connecticut on Monday. The dealership and serious estate firm allege LMP breached the obtain agreement to purchase Kia of East Hartford and home when LMP failed to post all essential information and facts to Kia Motors The united states.

LMP desired to get hold of maker approval to near the offer. And mainly because of that alleged breach of contract, the dealership and authentic estate business consider they are entitled to the deposits.

The dealership, owned by Joseph Klimas Jr., entered into a invest in and product sales agreement with LMP in July for far more than $9 million. Revenue was deposited in escrow with the title organization. A closing was slated to transpire by Feb. 28, in accordance to the criticism, and the plaintiffs say they terminated the deal on March 1.

On Feb. 18, Kia of East Hartford received a letter from Kia Motors that it had been notified by LMP that the transaction had been terminated and that Kia would no for a longer time appraise LMP’s application, according to the grievance.

In February, publicly traded car retailer LMP declared it was discovering strategic choices for the business, like marketing its 8 franchised dealerships and four utilised-auto merchants, just after it was unable to protected financing to near seven pending transactions. The Fort Lauderdale, Fla., corporation said it meant to terminate all of all those transactions.

LMP, in a regulatory filing, claimed the acquisition of Kia of East Hartford and property was terminated on March 11 and that it failed to be expecting any “materials termination penalties” connected to the canceled offer.

In some of LMP’s other canceled acquisitions, the vendor stored deposits, some as large as $2 million.

Robert Feiner, a Hartford, Conn., lawyer for Kia of East Hartford, said in a late Thursday email to Automotive News that “the events have agreed to solve any disagreement among them subject to finalizing ideal documentation.”

The dealership and serious estate corporation had sought damages, moreover costs, in addition to be awarded the $100,000 in deposits.

As of mid-Friday afternoon, there have been no up-to-date courtroom filings for the circumstance.

LMP executives did not respond to requests for comment on the lawsuit or feasible resolution.

LMP was slated to share its fourth-quarter earnings on Thursday but in a news launch explained it would hold off the release of its final results. It did not give a new date.

Katherine T. Burrows

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