AV auto dealer sues Palmdale, city attorney responds

PALMDALE – Antelope Valley Chevrolet owner, Lou Gonzales, is suing the City of Palmdale, claiming the City threw roadblocks in his way, which prevented him from opening a new Chevrolet Dealership in the Palmdale Auto Mall and forced him to locate his dealership in Lancaster instead. The case was filed in Los Angeles County Superior Court, case number BC473893.

A news release issued by Gonzales’ attorneys — Callahan, Thompson, Sherman & Caudill LLP – states:

Lou Gonzales owned Saturn of Antelope Valley located in the Palmdale Auto Mall. When General Motors eliminated the Saturn brand Mr. Gonzales was stuck with a Saturn dealership showroom and nothing to sell. However, because of his excellent performance for GM as a Saturn dealership, GM awarded him a new Chevrolet dealership in the Antelope Valley. Lou Gonzales, the owner of Antelope Valley Chevrolet wanted to purchase an empty lot in the Palmdale Auto Mall to build a state of the art Chevrolet showroom and to use his Saturn dealership to sell Chevrolets while the new showroom was being built. Instead of welcoming a new auto dealership to the Palmdale Auto Mall with the creation of lots of jobs and tax revenue for the residents of Palmdale, the Palmdale redevelopment agency threw every roadblock they could to prevent Lou Gonzales from building a new dealership in the Palmdale Auto Mall. They ultimately forced Lou Gonzales to locate his dealership in Lancaster, leaving his Saturn Dealership empty. After he decided to locate in Lancaster, the City of Palmdale sued the City of Lancaster.

Lou Gonzales filed a complaint against Palmdale alleging intentional interference and discrimination. The City of Palmdale will have 30 days in which to file a response to the lawsuit with the Court.

“I was shocked at the treatment I received by Palmdale when all I wanted to do was to build a beautiful showroom on a lot in the Palmdale Auto Mall that had been vacant for 20 years and to create millions of dollars of tax revenue for the City of Palmdale and create quite a few jobs for the residents of Palmdale,” Gonzales said in the statement. “Palmdale engaged in a game of politics instead of looking out for its residents.”

Palmdale City Attorney, Wm. Matthew Ditzhazy, disputes Gonzales’ account of what took place. Tuesday evening, Ditzhazy said Palmdale did not throw “roadblocks” in front of a “Palmdale Chevrolet dealership”; rather, Palmdale offered a lucrative taxpayer funded deal to Mr. Gonzales to encourage him to stay in the Palmdale Auto Mall.

Instead of accepting the deal from Palmdale, Gonzales demanded more and more concessions from Palmdale, including extra free land, and then pitted Palmdale against Lancaster in a bidding war for his dealership, Ditzhazy said.

The city attorney says Palmdale only lost out because it was unable to match the “illegal deal” Lancaster gave to Gonzales.

Lancaster reportedly agreed to a deal that would give Gonzales $600,000 in redevelopment funds to open his dealership in Lancaster. But Palmdale went to court to prevent Gonzales from receiving the funding.

“California law clearly states that Lancaster cannot provide financial incentives to steal an auto dealer from Palmdale to move to Lancaster,” said Ditzhazy. “Consequently, he [Gonzales] will not prevail against the jurisdiction (Palmdale) that prevented him from getting the $600,000 that he was not entitled to receive from the other (Lancaster). Also, Mr. Gonzales filed his claim late and his lawsuit is thereby prohibited by operation of law.”

Gonzales’ lawsuit seeks unspecified damages.

  7 comments for “AV auto dealer sues Palmdale, city attorney responds

  1. Doc Rivers
    November 25, 2011 at 11:26 pm

    This is the work of then newly elected Lancaster City Coucilmember Marvin Crist getting one over on Palmdale.

  2. Palmdale_Steve
    November 23, 2011 at 4:46 pm

    Had a car worked on at the new Lancaster Chevy store. Service was much better than dealing with Rally.

    • John Mlynar
      November 23, 2011 at 5:04 pm

      I’ve purchased new cars at both Rally and the former Saturn service. Had great service at both and continue to received great service, and a ride, from Rally.

  3. Eric Moore
    November 23, 2011 at 11:49 am

    Lancaster giving illigal money to business? hmmm,

  4. William
    November 23, 2011 at 10:51 am

    Well, well, well. Gonzales pitted both cities against each other and lost out on both incentives. Now he wants to recover through a lawsuit what he didn’t get from an illegal incentive from Lancaster. Too bad.

    I thought what happened was that Gonzales wanted the empty lot next to the AV Volkswagen dealship to use as a car lot rather than building a showroom and that Palmdale didn’t want that prime, freeway visible, location to be used only as a car lot. I’m just going from my recollection, so that may not have been the case.

    I heard that Gonzales was short on resources having to do with maintaining an inventory or whatever and so it looks like he might be trying to recover some other way. Maybe, Parris can lend him some of his own money.

    I wonder if perhaps business isn’t as good at the dealership as he and Parris expected. If it was, would Gonzales bother to sue?

    • Doc Rivers
      November 25, 2011 at 11:31 pm

      Talk about negotiating yourself out of a deal x2. “BRILLIANT”

      • William
        November 27, 2011 at 8:34 am

        As a Palmdale resident, if I owned a Chevy, I would take it to Rally for service than drive all the way to Lancaster plus, I wouldn’t want to do business with Gonzales anyway

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