The state Motor Vehicle Commission ruled Wednesday that World Class Auto Superstore in Nicholasville should no longer be able to sell new and used vehicles, the result of a long-running push by the state attorney general's office that claimed fraudulent practices by the auto dealership.
Among the claims against the dealership is that staffers allegedly had consumers sign forms on which important terms were left blank and that down payments were retained improperly after consumers were unable to obtain financing for vehicles at the terms represented.
Under the order, World Class Auto Superstore "must cease all activity as a new or used motor vehicle dealer" after a 30-day period. The dealership sells new Subarus as World Class Subaru and used vehicles. The ruling can be appealed at the Franklin Circuit Court by filing a petition within the 30 days, according to the ruling.
"Protecting Kentucky consumers is a top priority of the Office of the Attorney General, so naturally we are pleased with the action taken by the Kentucky Motor Vehicle Commission," said spokeswoman Shelley Johnson.
Chris Spedding, an attorney for the dealership, said the order "was erroneously issued, and we do intend to appeal it."
He declined to elaborate.
"I'm going to address those issues in our objection," he said.
He added, "the dealership maintains that it treats its customers in a fair and ethical manner and intends to do so in the future."
According to the ruling, the Motor Vehicle Commission has previously issued administrative citations to the dealership alleging violations of various state laws. Hearings were held late last year that were not attended by a dealership representative, according to the ruling.
Spedding declined to discuss why a representative of the dealership did not attend.
Among the issues discussed at the hearings were allegations that the dealership sold vehicles to customers but did not release liens that had been on them after the sale.
The order also addressed the company's alleged violations of injunctions issued by Jessamine Circuit Court.
The court had ordered the dealership to pay more than $6,300 in restitution to two customers and also found it in contempt of an order requiring that it not use false, misleading and deceptive practices in dealing with consumers.
The case dates back a few years. The first injunction came in 2006, after the attorney general's office said World Class Auto had falsely represented to consumers that the purchase of a vehicle was completely financed on specific terms and allowed buyers to take possession of the cars.
Later, however, the dealership contacted consumers and informed them that financing could not be obtained, the case files said.
In some cases, consumers were not informed of the financing problems for weeks or even months after delivery, the motion said.
Consumers then were forced to agree to much less favorable terms.
To force consumers to agree to the new terms, the case motions said, World Class Auto would refuse to return down payments; refused to return trade-in vehicles; and charged an "unconscionable" rental fee of $75 a day and 35 cents a mile for the vehicles.
"We have received complaints about the business practices of World Class Auto dating back to 2001, which resulted in this office filing suit against the business," said Johnson of the attorney general's office. "Despite several court orders, World Class Auto has continued to engage in a pattern of false, misleading and deceptive business practices, in violation of the Consumer Protection Act."