Chrysler Dealers Appeal Franchise Ruling

NEW YORK (AP) -- A pair of former Chrysler LLC dealerships has filed an appeal of a bankruptcy judge's order terminating their franchises and those of more than 700 others as part of Chrysler's restructuring plan.

Tarbox Motors Inc. of North Kingstown, R.I., and Tarbox Chrysler Jeep LLC of Attleboro, Mass. filed a notice in bankruptcy court on Friday, saying that they were appealing the decision to U.S. District Court.

Earlier this month, U.S. Judge Arthur Gonzalez ruled that Auburn Hills, Mich.-based Chrysler LLC could terminate the franchise agreements of 789 of its dealers as part of its restructuring plan.

Chrysler said in court that it needed to reduce its dealer network by about 25 percent to a leaner network of about 2,400 dealers in order to emerge from bankruptcy protection as a stronger company.

But the dealers argued that the move wouldn't save the company any substantial money and would result in the shuttering of hundreds of dealerships and the elimination of thousands of jobs.

During a two-day long hearing preceding Gonzalez's ruling, more than a dozen Chrysler dealers slated to lose their franchise agreements testified including James Tarbox, who ran the two appealing dealerships.

Tarbox broke down on the stand in tears during his testimony, noting that his dealerships won awards for both sales and service in recent years.

Gonzalez ruled in favor of Chrysler and the 789 dealers lost their franchises effective June 9. Some said they planned to stay in business selling used cars and operating service centers, while others said they would be forced to close up shop completely.

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