Originally published in the Minneapolis Star 7-27-81


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Star Illustration by Todd Grande

Bradley battle

Angry customers seek to build case against local car dealer 

By RALPH VARTABEDIAN
The Minneapolis Star

An electric-powered lemon built in Minnesota soured John Clayton's life one year ago. It's still parked in his garage, immobile.

Clayton, 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.

The car that Courneya's Twin Cities company shipped to Clayton last year had so many missing parts it wouldn't run, Clayton said.

This 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 the country.

"I am disturbed, perplexed, frustrated and confused how such a situation occurred," Clayton recently wrote the Minnesota attorney general's office.

Clayton is luckier than many of Courneya's customers, though. At least he got a car.

Customers 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.

In 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.

A 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.

Meanwhile, 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.

 

 

 

Courneya's 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.

Courneya, 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 other companies.

Consumer problems resulted with all the product lines, according to court papers.

During 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.

Courneya did not return a reporter's telephone calls.

The 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.

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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.

The 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.

 

"We 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."

The 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.

But the marketing areas weren't exclusive and few brokers received tips or earned profits, according to an affidavits filed with the case.

Part 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 Jerry Matthews.

Matthews 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.

"Thus, the customer would get the impression that significant sales were being made by other brokers," his affidavit said.

If 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.

The consumer problems didn't stop there, however.

Promises 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.

The 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.

 

The 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.

And when the vehicles are finally delivered, many are not in running order because they lack key parts.

Take, 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.

Another key part of the restraining order of the attorney general's office prohibits the removal or transfer of any assets of the company out of state.

Harris, 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.

Electric 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.

"Based 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."

The 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.

The 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 sales.

 

Copyright 2000 Star Tribune. Republished with permission of Star Tribune, Minneapolis-St. Paul. No further republication or redistribution is permitted without the written consent of Star Tribune.

 

 




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