Some Olds dealers lose again

GM deceit continues
Some Olds dealers lose again http://www.detnews.com/article/20090808/AUTO01/908080315/1148/rss25
First, Oldsmobile dealers lost the brand. Now, some are losing big bucks.
When General Motors Corp. announced it was killing Oldsmobile nine years ago, the automaker offered dealers as much as $4 million to avoid lawsuits over whether the move violated state franchise laws. That is a thorny issue being revived during debates in Congress over attempts by Chrysler LLC and General Motors Co. to shed 3,000 dealers.
In all, GM paid dealers more than $1 billion when it eliminated the 103-year-old brand because of dwindling sales. Some of the 2,800 Oldsmobile dealers took lump-sum payouts, which were based mainly on sales volume. Others agreed to annual cash payments for as long as 10 years.
Several dealers just learned they won't be receiving the rest of their money because the automaker is leaving those payments in bankruptcy court with the "old GM," according to a recent bankruptcy court filing. They'll likely get pennies on the dollar for their claims, which vary, but ranged from $50,000 to $4 million.
"I feel like I got a little shortchanged," said Richard Hammer, a dealer from Wyoming who is owed about $20,000.
The move compounds the pain for dealers who lost second- or third-generation franchises when GM eliminated Oldsmobile and who gave up a possible huge payday in court by accepting annuities.
Some of those same dealers own other GM franchises and are struggling to survive the slumping auto sales market -- a prospect made more difficult now that annuity payments are being treated as unsecured claims.
While only a handful of dealers are still owed money, it's the principle, said Florida lawyer Richard Sox, whose firm represented about 200 Oldsmobile dealers who accepted payouts. Twenty percent of those dealers accepted annuities.
"It is absolutely atrocious ... that they would be considered an unsecured claim, which means those dealers are going to be lucky to get pennies on the dollar," Sox said. "It is just outrageous that they would not attempt to meet their obligations under those settlements."
A new GM, which has received $50 billion in federal aid, emerged from bankruptcy court July 10 after shedding billions in debts, liabilities and unwanted assets.
GM declined to say how many of the former Oldsmobile dealers accepted annuity payments.
"We will comply with whatever the bankruptcy court provides to us in terms of handling those matters," GM spokeswoman Susan Garontakos said.
That doesn't help Richard Pendarvis, whose third-generation Oldsmobile dealership closed in 2001. He said GM agreed to pay about $80,000 spread over nine or 10 years and figures he's owed three more payments.
"I made a bad decision," said Pendarvis, who also owns a Chevrolet franchise in Edgefield, S.C.
"They told me they wouldn't pay me," he said.
Pendarvis is among five former Oldsmobile dealers listed in recent court filings. The dealers stretch from New York state to Sheridan, Wyo., where Hammer's family had sold Oldsmobiles since World War II. The franchise closed in 2002 after Hammer agreed to a deal that paid about $7,000 a year for 10 years.
He figures he'll lose about $20,000 by GM leaving the agreement behind in bankruptcy court.
"At this time in this business, it's very significant," Hammer said.
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Civis Romanus Sum

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So what? That's they way bankruptcy laws work. Many a business get stiffed every year when other bail out on them. They took the annuity to get more money than the lump sum offer. Maybe us taxpayers should get together and take up a collection for them. We'll call it "Dollars for Dealers" and have Congress administer it.
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True. But GM made a business of it, in fact bankrupt years ago it operated fraudulently and to a level never before seen by a corrupt management. SEC didn't even investigate GM's cooked books! Worse yet, most of the management is still there and you can bet their fat pensions and fat salaries and fat severances will be honored.
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On Sat, 08 Aug 2009 07:04:01 -0400, Jim Higgins

Basically some dealers agreed to loan GM money, and now they are screwed. How is this news? Never, ever loan money if you are not a bank or loan company. When you loan money, you must always assume that you won't get paid the full amount back, and take that risk into consideration.
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It wasn't just dealers. Shareholders had won lawsuits in some cases years ago for GM's false fininancial filings and cooked books. The lawyers stalled it to bankruptcy. Bond holders, creditors and suppliers too, the real big shaft. Many suppliers laid people off and some went bankrupt for the GM screwing. How GM behaved in this was criminal.
Just add these dealers to GM road kill, it is a long list. In fact anyone who had faith in GM and had a financial interest in them got screwed. Years ago GM sold off profitable parts, Carlyle made millions for the rich as they packaged GM for failure on the public purse.
Then comes BO, Bailout Obama, and no one is asking for the details of over $100B sent to corrupt auto. No one even public questions the slide of taxpayers being saddled with the debt to shift the $100B to who knows where. $100B probably went to pay off the debts of the influencial super rich is my guess.
Obama, Harper/Iggy/Laytoon, congress, senate and parliament sold out the US and Canadian people for corruption.
People need to find an effective way to control our governments debt-corruption spend before it is too late. You know the bill is going to you the taxpayer. At no time in the history of the world has a governemnts like US and Canada racked up so much debt and currency dilution as they are now doing.
We need to openly start protesting this. Challenge the governments integrity by asking the hard questions and demanding the real answers.
And if neccessary, peacefully refuse to pay our taxes. Say 30% of the people refused to pay taxes, they will not go to jail as there isn't that much court or jail space. Government can't afford it. But we do know CBC and other liberal leaning media will try to roadblock the people organizing for this, but our fiscal liberty is at stake. We can stand by like stunded sheep or we can revolt.
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