Bristol Car Dealership Anticipates Selling Toyota Franchise

BRISTOL, CT — Stephen Cadillac GMC is planning to sell its local Toyota franchise and use the proceeds to resolve litigation which claims it owes about $5 million, court documents show.

Stephen Cadillac GMC in late May submitted to its franchisor, Toyota Motor Sales, USA, Inc., a request for approval of the sale of its franchise, which is on Farmington Avenue. The sale is expected to close by June 30.

Stephen Cadillac GMC intends to use the proceeds from the sale to pay off its debts to Toyota Motor Credit Corporation.

Attorney Richard S. Order of Updike, Kelly & Spellacy in Hartford, who represents Stephen Cadillac GMC, outlined the plans in a recent filing in U.S. District Court.

The sale is expected to resolve ongoing federal litigation.

In April, Toyota Motor Credit Corporation, or TMCC, sued Stephen Cadillac GMC Inc.

TMCC provides inventory financing as a lender to Toyota dealers nationwide. In the litigation, it claims the Bristol dealership owes it more than $5 million. TMCC claims the dealership sold vehicles, but didn’t repay inventory loans, for example.

This month, the dealership’s legal counsel asked the court to issue a stay in the case through June 30, given the expected resolution of TMCC’s claims and the anticipated settlement of the litigation.

“Such a stay will enable the defendants to focus their resources on settlement rather than on litigation,” Order said, in court documents.

Judge Sarah F. Russell this week continued the stay in the case through June 30.

Attorneys representing Stephen Cadillac GMC and Toyota have not responded to requests for comment.