Guarantee Fork Lift, Inc. v. Capacity of Texas, Inc.Annotate this Case
Capacity manufactures “Trailer Jockey” semi-tractors. GFL became an authorized Capacity dealer under a 1995 franchise agreement. In 2013, Capacity notified GFL of its intent to terminate GFL’s franchise, alleging GFL had misrepresented the employment status of a former GFL employee who went to work for Capacity’s chief competitor and allowed the employee to continue accessing Capacity’s online parts ordering system while working for the competitor. GFL filed a protest with the state New Motor Vehicle Board, alleging there was no good cause for the termination, as required by the Vehicle Code. An ALJ concluded Capacity had not established good cause because GFL had not violated the express terms of its franchise agreement. The Board agreed. The Sacramento County Superior Court directed the Board to set aside its decision. While that case was pending GFL filed this suit in the Alameda County Superior Court, which concluded that GFL did not have standing because section 11726 only authorizes actions by “licensees” of the DMV and GFL did not possess such a license. The court of appeal reversed. GFL is a member of the class protected by the subdivision of section 11713.3 on which its cause of action is based; its claim is not defeated by its status as non-licensee.