The Minneapolis Star
electric-powered lemon built in Minnesota soured John Clayton's
life one year ago. It's still parked in his garage, immobile.
a Maryland insurance broker paid $6,245 for an electric car sold
by Gary Courneya, the former Beverly Hills sports car salesman whose
business dealings in past years have given rise to lawsuits and
disgruntlement across the nation.
car that Courneya's Twin Cities company shipped to Clayton last
year had so many missing parts it wouldn't run, Clayton said.
past week, Minnesota moved against Courneya and his company-currently
called the Electric Vehicle Corp.-after mounting evidence that Courneya
and his company allegedly deceived and defrauded customers throughout
am disturbed, perplexed, frustrated and confused how such a situation
occurred," Clayton recently wrote the Minnesota attorney general's
is luckier than many of Courneya's customers, though. At least he
got a car.
all over the United States plunked down as much as $20,000 after
being promised they would receive an electric car, under the model
name Bradley, within four to six weeks. Months later, many are still
waiting for delivery.
a series of complaints, affidavits and motions for restraining orders,
the attorney general's office asked for a halt to the alleged deception,
fraud and consumer abuse. The office also asked for $25,000 in penalties
for each violation of Minnesota consumer laws.
temporary restraining order was granted by Hennepin District Court
last week and a motion for a preliminary injunction against the
company and Courneya will be taken up in coming weeks.
some customers have become so angry at Courneya and Electric Vehicle
that they recently traveled to Minnesota at their own expense and
picketed outside the company's headquarters at 6860 Shingle Creek
Parkway, Brooklyn Park.
aim for glory has had an erratic course. An effort in 1979 to develop
a supercar that would go 130 miles on a gallon of gasoline collapsed
into oblivion. Insolvency forced his company into Bankruptcy Court
in 1979. Lawsuits across the country have plagued him.
38, has headed various companies selling kit cars and completed
cars in recent years. All the Bradley cars consisted of fiberglass
bodies that were installed on Volkswagen Beetle chassis, powered
by either a conventional gasoline engine or, later, an electric
motor. Courneya's company does not actually manufacture any of the
major components of the cars, but simply packages parts made by
problems resulted with all the product lines, according to court
1981, the attorney general's office received 30 complaints from
customers, according to consumer division investigator Alan Harris.
It's impossible to estimate the number of disgruntled customers
who did not formally complain because an out-of-state company was
involved, Harris said.
did not return a reporter's telephone calls.
recent complaints echo the same types of consumer fraud practices
that Courneya was ordered to stop in 1979 by Bankruptcy Judge Hartley
Nordeen. The Chapter 11 bankruptcy code proceeding eventually resulted
in many creditors settling for a fraction of their claims.
In the current case pending against Courneya, the attorney general's
office alleges that customers were mislead into thinking they could
earn profits by becoming "brokers" for Electric Vehicle. The "Executive
Broker Program" was advertised in such national magazines as New
Republic, Commentary and Success.
sales promotion suggested that if a customer decided to become a
broker, he or she could buy their first electric car for about $20,000,
instead of the full price of $27,000.
didn't find anybody who actually paid the full $27,000 for a car,"
said Special Assistant Attorney General Thomas Barrett, who is handing
the case. "Almost everybody bought the car at the discount."
Electric Vehicle sales representatives implied that the brokers
would have exclusive marketing area and would receive tips from
the company that would lead them to prospective clients.
the marketing areas weren't exclusive and few brokers received tips
or earned profits, according to an affidavits filed with the case.
of the sales talk included the pressuring of clients into quick
decisions by suggesting that other potential brokers already had
applied for their area, according to an affidavit by former salesman
said that customers were told the company was geared for production
of 10,000 automobiles during 1981 and that one-third of the vehicles
already had been sold.
the customer would get the impression that significant sales were
being made by other brokers," his affidavit said.
customers wanted to check references, they were told to contact
brokers Bill Kolker of Illinois and Tony DeFranco of Florida, according
to the affidavit. But Kolker and DeFranco were misrepresenting themselves
as brokers and charged a fee in assisting in making such sales,
according to the lawsuit.
consumer problems didn't stop there, however.
allegedly were made about delivery schedules that the company could
not hope to keep. Consequently, dozens of customers waited and waited
for deliveries of their electric cars.
lawsuit indicates that Courneya has sold 30 to 40 cars per month,
but has the capacity to build only 10 to 11 cars per month. The
company reportedly has a 100 car backlog, according to court records.
customers, meanwhile, have placed down payments, ranging from $5,000
to $20,000, with the understanding that the cars would be delivered
within four to six weeks.
when the vehicles are finally delivered, many are not in running
order because they lack key parts.
for example, David Holmes of Ottumwa, Iowa, who wrote the Minnesota
attorney general's office about his Bradley kit car that he bought
for $6,395 in September 1980. His car is missing its side windows
and, after repeated attempts to obtain the missing parts, he has
been informed that the company no longer sells kit cars.
key part of the restraining order of the attorney general's office
prohibits the removal or transfer of any assets of the company out
the state investigator assisting in the case, said that evidence
suggests a potential transfer of assets, which could foil the eventual
execution of the injunctions and the collection of court fines.
Vehicle employees told Harris that Courneya and Electric Vehicle
are contemplating a manufacturing site in California. An inventory
of Bradley cars has been se at an Orange County, Calif., facility.
upon the information…it is my opinion and belief that additional
assets of defendant corporations…will be moved out of the state
of Minnesota and into the state of California."
lawsuit asks that Electric Vehicle be prevented from destroying
or removing any of its financial, sales, tax, bank or other records
that will be important in the case against the company.
suit also asks that the company be required to inform prospective
customers of the actual number of brokers and cars sold by brokers,
the number of brokers living within 100 miles, the number of cars
on order, the production capacity and other key information in making