Francis Scott Key Lincoln Mercury, a dealership in Frederick, has filed a $2.9 million federal lawsuit against the Ford Motor Co. over how the auto maker handled the end of the Mercury nameplate.
Francis Scott Key Lincoln Mercury, or FSK Automotive, filed the lawsuit in the U.S. District Court in Baltimore on Wednesday. Among the dealership’s claims are that Ford required it to build a multimillion-dollar showroom, and offered a “grossly inadequate” settlement to cover the loss of business when it was not able to sell Mercury vehicles.
FSK Automotive owner Pete Adcock was not available for comment on Thursday.
Ford spokesman Christian Bokich said company policy was not to comment on pending litigation. Bokich did say that the company has completed settlements with 97 percent of Mercury dealers by the end of 2010.
FSK Automotive had been a Mercury dealer from 1984 until Dec. 31 when Mercury’s parent company, Ford, discontinued the brand to put more focus on the Ford and Lincoln lines.
According to court documents, the dealership claims it started 2010 with Ford management touting its support of the Mercury brand, including the news of a Mercury Tracer model for 2011. Then, in June, Ford broke the news it was going to discontinue the Mercury line at the end of the year. FSK Automotive claims it was offered only $181,026 in compensation for the loss of the Mercury line.
“Although Ford in the [offer] stated that it believes that dealers will find the offer ‘fair and reasonable,’ [FSK Automotive] has seen nothing from Ford that justifies its offer, which is grossly inadequate to compensate [FSK Automotive] for the harm that will result from the loss of the Mercury line,” the lawsuit states.
FSK Automotive is also claiming it spent $5.5 million to build a new sales and service facility after Ford officials said in 2002 that it was required to carry the Jaguar, Land Rover and Volvo brands.
Prior to filing the lawsuit, the dealership appealed the offer to Ford’s dealer policy board, which rejected its claim.
FSK Automotive is being represented by DLA Piper in the litigation.