Vehicle Code 11726 provides that a licensee that suffers pecuniary loss from another licensee’s willful failure to comply with various auto franchise statutes or DMV regulations may recover damages and attorney fees. This decision holds that a plaintiff need not be a “licensee” in order to recover under the statute. Instead, so long as the plaintiff is one of the entities which the underlying franchise statutes are intended to protect, it may sue under section 11726 even though it holds no DMV license. Here, the plaintiff alleged and raised a triable issue of fact at summary judgment on a claim that in violation of Vehicle Code 3060(a)(2), the defendant franchisor de facto terminated plaintiff’s franchise while its protest was still pending before the New Motor Vehicle Board. As section 3060 is intended to protect franchisees from arbitrary terminations, a franchisee may sue for violation of that section as incorporated in section 11726 even though, as here, the franchisee holds no DMV license.
California Court of Appeal, First District, Division 5 (Needham, J.); May 2, 2017 (published May 24, 2017); 2017 WL 2267270