Northwest Hills Chrysler Jeep, LLC v. Dept. of Motor Vehicles ( 2020 )

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APPENDIX
NORTHWEST HILLS CHRYSLER JEEP, LLC, ET AL.
v. DEPARTMENT OF MOTOR VEHICLES ET AL.*
Superior Court, Judicial District of New Britain
File No. CV-XX-XXXXXXX-S
Memorandum filed April 15, 2019
Proceedings
Memorandum of decision on plaintiffs’ appeal from
decision by named defendant. Appeal dismissed.
James J. Healy, Jason T. Allen, pro hac vice, and
Richard N. Sox, pro hac vice, for the plaintiffs.
Eileen Meskill, assistant attorney general, and George
Jepsen, former attorney general, for the named defen-
dant et al.
Charles D. Ray, Shawn S. Smith, George W. Mykulak,
pro hac vice, and Caitlin W. Monahan, pro hac vice,
for the defendant FCA US, LLC.
Jay B. Weintraub, John L. Bonee and Eric H.
Rothauser, for the defendant Mitchell Dodge, Inc.
Opinion
HUDDLESTON, J. In this administrative appeal, four
automobile dealers assert that the defendants Depart-
ment of Motor Vehicles and its commissioner, Michael
R. Bzdyra (collectively, department), improperly denied
their protest to the decision of the defendant FCA US,
LLC (FCA), to establish a new Jeep dealership in Can-
ton. They assert that the department (1) failed to comply
with its statutory mandate to consider the existing cir-
cumstances of two of the dealers, (2) made findings
that are not supported by substantial evidence with
respect to three statutory factors, and (3) made irrecon-
cilable findings with respect to two of the factors. FCA
and the department, in separate briefs, disagree. After
considering all the arguments of the parties, and
reviewing the entire administrative record, the court
concludes that the department’s decision is neither
incomplete nor inconsistent and is supported by sub-
stantial evidence. Accordingly, for the reasons stated
below, the appeal is dismissed.
LEGAL FRAMEWORK
In Connecticut, the relationships between manufac-
turers and dealers of motor vehicles are governed by
General Statutes §§ 42-133r through 42-133ee. These
provisions recognize the ‘‘need for intra-brand competi-
tion.’’ McLaughlin Ford, Inc. v. Ford Motor Co., 192
Conn. 558, 569 n.14, 473 A.2d 1185 (1984). Section 42-
133r (14) defines ‘‘ ‘[r]elevant market area’ ’’ as ‘‘the
area within a radius of fourteen miles around an existing
dealer or the area of responsibility defined in a fran-
chise, whichever is greater.’’ The law ‘‘does not guaran-
tee an exclusive right to operate a dealership within a
fourteen mile radius, but rather requires the [C]ommis-
sioner of [M]otor [V]ehicles to demonstrate good cause,
as defined in the statute, for denying the addition or
relocation of a dealer in the objecting dealer’s relevant
market area.’’ (Internal quotation marks omitted.)
McLaughlin Ford, Inc. v. Ford Motor Co., supra, 569
n.14.
If a manufacturer wants to add a new dealer or to
relocate an existing dealer within the relevant market
area of an existing dealer, General Statutes § 42-133dd
(a)1 requires the manufacturer to notify the Commis-
sioner of Motor Vehicles and each existing dealer of its
intention. If an existing dealer files a protest with the
commissioner, the manufacturer cannot proceed until
the commissioner has held a hearing and has deter-
mined whether there is good cause for denying the
manufacturer’s plan. The manufacturer bears the bur-
den of proving that good cause exists for permitting
the proposed establishment or relocation. Section 42-
133dd (c) sets out eleven nonexclusive ‘‘circumstances’’
or factors to be considered in determining whether good
cause exists.2
DEPARTMENT’S FINDING OF FACTS
AND CONCLUSIONS OF LAWS3
Mitchell Dodge, Inc., doing business as Mitchell
Chrysler Dodge (Mitchell), operates a Chrysler, Dodge,
Ram (CDR) dealership presently located at 416 Hop-
meadow Street in Simsbury. There are thirty CDR deal-
erships in Connecticut; all but four of them also sell the
Jeep line. Mitchell is one of the four dealers currently
without the Jeep line.
The four plaintiffs operate Chrysler, Dodge, Jeep,
Ram (CDJR) dealerships in Connecticut. Northwest
Hills Chrysler Jeep, LLC (Northwest), operates a CDJR
dealership in Torrington. Gengras Chrysler Dodge Jeep,
LLC (Gengras), operates a CDJR dealership in East
Hartford. Crowley Chrysler Plymouth, Inc., doing busi-
ness as Crowley Chrysler Jeep Dodge Ram (Crowley),
operates a CDJR dealership in Bristol. Papa’s Dodge,
Inc. (Papa’s), operates a CDJR dealership in New Brit-
ain. Each of their dealerships is within fourteen miles
of Mitchell’s present location.
In 2007, FCA’s predecessor, DaimlerChrysler Motors
Company, LLC, looked to add the Jeep line to Mitchell’s
franchise at its present location. It gave the statutorily
required notice to the dealers in the relevant market
area. Northwest, Gengras, Crowley, and Papa’s filed a
protest pursuant to § 42-133dd (a), and the proposal to
establish the Jeep line at Mitchell’s present location
was withdrawn on March 5, 2007.
On May 5, 2016, FCA gave notice to the department
and to affected existing Jeep dealers that Mitchell
intended to construct a facility at 71 Albany Turnpike
in Canton, where it would relocate its existing CDR
dealership, and requested to add the Jeep line. On May
23, 2016, Northwest, Gengras, Crowley, and Papa’s pro-
tested the establishment of the Jeep line. They did not
protest the relocation of Mitchell’s CDR dealership.4
In FCA’s dealer agreements, a ‘‘sales locality’’ is a
geographic area of responsibility defined by specific
census tracts. These are nonexclusive areas. Mitchell
and the protesting dealers are located within three sales
localities. Mitchell’s present location, Gengras, and
Papa’s are located within the FCA’s Hartford sales local-
ity. Mitchell’s proposed location is also within the Hart-
ford sales locality. Crowley is within the FCA’s Bristol
sales locality, and Northwest is within the FCA’s Torrin-
gton sales locality.
FCA further divides sales localities into ‘‘trade
zones,’’ also defined by census tracts. The Hartford sales
locality is divided into five trade zones: Enfield, East
Hartford, New Britain, Rockville, and Simsbury. Of the
five trade zones, two—Enfield and Simsbury—do not
presently have Jeep dealerships, and are known in the
trade as ‘‘open points.’’
Section 42-133dd (c) requires the commissioner or
his designee to ‘‘take into consideration the existing
circumstances,’’ which ‘‘includ[e], but [are] not limited
to,’’ eleven circumstances. The final decision addressed
each of the eleven specified circumstances.
Section 42-133dd (c) (1) requires consideration of
the ‘‘permanency and size of investment made and the
reasonable obligations incurred by the existing new
motor vehicle dealers in the relevant market area
. . . .’’ As to this consideration, the department found
that the existing motor vehicle dealers ‘‘have made sig-
nificant and permanent investments, and have incurred
financial obligations in their dealership facilities,
located in the respective relevant market area.’’ The
department acknowledged FCA’s argument that the
dealers’ investments had been made over a period of
years, that the protesting dealers ‘‘are strong dealers
who have successfully completed and succeeded
against other dealers,’’ including Mitchell in its present
location, and that the dealers’ agreements with FCA
are expressly ‘‘ ‘non-exclusive’ . . . .’’
Section 42-133dd (c) (2) requires consideration of the
‘‘growth or decline in population and new car registra-
tions in the relevant market area . . . .’’ As to this
consideration, the department found that between 2000
and 2015, the population in the Hartford sales locality
grew by over 40,000, or 4.9 percent. In the Simsbury
trade zone, where the proposed Jeep location would
be established, the population grew by 9.1 percent,
which the department found to be the highest percent-
age of growth of all trade zones in the Hartford sales
locality and higher than the growth in the Torrington
and Bristol sales localities. The department found that
both population and household growth is projected to
be less than 1 percent between 2015 and 2020, rising
slightly but remaining stable. Vehicle registrations in
Connecticut rose by a significant percentage from 2010
through 2015, with Jeep registrations increasing by
172.5 percent. The department noted, however, that
sales ‘‘peaked and plateaued in 2016,’’ a nationwide
trend that may continue. The department observed that
the protesting dealers saw this slowing growth as sup-
port for their position that another Jeep dealership is
not needed.
Section 42-133dd (c) (3) requires consideration of the
‘‘effect on the consuming public in the relevant market
area . . . .’’ The department found that the consuming
public would benefit from the addition of the Jeep line
at the proposed location. Route 44 (Albany Turnpike)
in Canton has evolved into an ‘‘auto row’’—an area
where numerous vehicle brands have established deal-
ership locations and compete within the vicinity of each
other. Presently located near the proposed location are
competitors of Jeep, including Chevrolet, Acura, Subaru,
Volkswagen, Nissan, Toyota, Land Rover, and Honda
dealers. The department found that ‘‘[a]uto rows are
now common, and provide a convenience to consumers
in having the ability to shop and compare competing
brands at dealerships in close proximity.’’ The depart-
ment also found that drive time is significant to consum-
ers. Although the parties disagreed as to the amount
of time consumers would save if a new Jeep line were
added at the proposed location, the department found
that distances and drive times from the proposed loca-
tion to the protesting dealers’ locations are not insignifi-
cant, and that location on such an auto row would
increase interbrand and intrabrand competition, to the
consumer’s benefit.
Section 42-133dd (c) (4) requires consideration of
‘‘whether it is injurious or beneficial to the public wel-
fare for a new dealer to be established . . . .’’ The
department found that the addition of construction and
dealership based jobs, payroll and property taxes, and
sales and use tax revenue would be beneficial to the
public welfare in the Simsbury trade zone and particu-
larly in Canton, the site of the proposed location. The
department acknowledged the protesting dealers’ argu-
ment that the benefit in construction jobs was only
speculative, as there were only projections by Mitchell
and one of the FCA experts as to what expenditures
Mitchell would make if it were granted the Jeep dealer-
ship. The department observed that Mitchell could not
be expected to have a detailed proposal in place, since
it did not know if or when it would be allowed to add
the Jeep line, and its ability to obtain the necessary
approvals and financing for the project required the
approval of the Jeep line at the proposed location. The
department concluded that approval of the Jeep vehicle
line ‘‘is not injurious to the public welfare.’’
Section 42-133dd (c) (5) requires consideration of
‘‘whether the dealers of the same line make in that
relevant market area are providing adequate competi-
tion and convenient customer care for the motor vehi-
cles of the line make in the market area including the
adequacy of motor vehicle sales and service facilities,
equipment, supply of motor vehicle parts, and qualified
service personnel . . . .’’ As to this consideration, the
department found that the protesting dealers have ade-
quate service facilities, equipment, supply of motor
vehicle parts, and qualified service personnel. The pro-
testing dealers already compete successfully with
Mitchell in a number of segments and franchises, includ-
ing new CDR vehicles, the sale of used, certified pre-
owned vehicles, including CDR and Jeep, warranty and
out of warranty service on CDR and Jeep vehicles, and
sales of parts for CDR and Jeep vehicles. As the depart-
ment observed, however, the Simsbury trade zone has
never had a Jeep dealership, and sales of new Jeeps in
that trade zone have to be handled by in-selling. The
only option for consumers in that area is to search for
and purchase a new Jeep from a dealership outside the
area, which, with Internet advertising, could be a dealer
other than the protesting dealers. Television and
Internet advertising by the protesting dealers reaches
far beyond their relevant market areas, into adjoining
states.
In considering § 42-133dd (c) (5), the department dis-
cussed registration effectiveness, a measure used by
the automotive industry to assess brand performance.
Registration effectiveness compares brand registra-
tions within a territory to the expected number of regis-
trations. It is distinct from dealer performance, which
is calculated on ‘‘[m]inimum [s]ales [r]esponsibility,’’ or
MSR. As the department observed, ‘‘[d]ealer perfor-
mance measures whether a dealer has captured the
opportunity for sales assigned to it.’’ FCA’s dealers in
the Hartford sales locality meet their MSRs, but the
Hartford sales locality is only 84 percent registration
effective. This indicates lost sales for the brand and
supports the need for another Jeep dealer.
Section 42-133dd (c) (6) considers ‘‘whether the
establishment of a new dealer would increase or
decrease competition . . . .’’ FCA argued that a new
Jeep dealer would result in better prices, better choices,
and better service as a result of the visibility of the
proposed location, additional expected advertising by
Mitchell, and increased interbrand competition. FCA
also argued that existing dealers were not selling
enough Jeeps to meet their expected market share. On
the other hand, the protesting dealers argued that Jeep
parts and service are already available in the Simsbury
trade zone at Mitchell’s existing location, and the addi-
tion of the Jeep line for sales would result in only
‘‘[minimally improved] convenience.’’ The department
found that, on balance, the addition of the Jeep line at
the proposed location would increase competition.
Section 42-133dd (c) (7) requires consideration of
‘‘the effect on the relocating dealer of a denial of its
relocation into the relevant market area . . . .’’ The
department observed that, although this case involves
the establishment of a new Jeep dealer rather than the
relocation of an existing Jeep dealer, consideration of
the eleven circumstances set out in § 42-133dd (c) are
not exclusive. Considering the effect of a denial of the
Jeep line on Mitchell, the department found that Mitch-
ell had been losing money for years in its present loca-
tion, and the possibility that it would have to relinquish
its CDR dealership was relevant in terms of Mitchell’s
overall financial health. Loss of Mitchell’s CDR dealer-
ship would adversely affect the customers who cur-
rently use Mitchell’s services at its present location.
Section 42-133dd (c) (8) requires consideration of
‘‘whether the establishment or relocation of the pro-
posed dealership appears to be warranted and justified
based on economic and marketing conditions pertinent
to dealers competing in the community or territory,
including anticipated future changes . . . .’’ The
department made extensive findings with respect to
this issue. It found that the annual number of new vehi-
cle sales for all manufacturers increased significantly
from 2009–2010, when it was approximately twelve mil-
lion units, to 2016, when sales were in excess of seven-
teen million units. In Connecticut, the Jeep line, mea-
sured by registrations, increased from 3945 in 2010 to
10,751 in 2015.
The department further found that when Chrysler
emerged from bankruptcy in 2009 and FCA acquired
certain of its assets, one of FCA’s goals was to establish
Chrysler, Dodge, Jeep, and Ram as a unified franchise
under one roof. This consolidation plan was presented
to the Bankruptcy Court both as a plan of survival for
the brand and a plan that would benefit dealers and
consumers. Approximately 60 to 70 percent of FCA’s
sales in the United States come from Jeep. In light of
the greatly increased consumer preference for sport
utility vehicles (SUVs), FCA is increasing production
of Jeeps and introducing new models, with the expecta-
tion of selling 24 percent more Jeeps by 2020 than are
currently sold. Existing dealers have benefited from
this trend and will continue to benefit from planned
new products and increased production volume.
The department found that the protesting dealers do
sell Jeeps into the Simsbury trade zone, but most of their
sales are made near their dealerships. It is a priority of
FCA to establish dealerships, including the Jeep line,
in auto rows such as the one in Canton to encourage
cross-shopping and to be competitive with non-FCA
brands.
The department found that Northwest’s auto group
includes a Chevrolet, Buick, GMC, Cadillac dealership
in Torrington that competes with Davidson Chevy,
which is less than a mile from Mitchell’s proposed loca-
tion in Canton. In addition, the family that owns North-
west also owns O’Neill Chevrolet Buick in Avon,
approximately three and a half miles from Davidson
Chevy, and also owns a Honda dealership in Torrington
that competes with Hoffman Honda in West Simsbury.
The department found that Crowley’s dealership
group includes Nissan Crowley in Bristol, which com-
petes with Hoffman Nissan in Canton. Hoffman Nissan
is located near Mitchell’s proposed location. Crowley
also owns a Volkswagen dealership in Plainville that
competes with Mitchell Volkswagen in Canton, less
than a mile from Mitchell’s proposed location for adding
the Jeep line.
The department found that Mitchell owns both 71
and 91 Albany Turnpike in Canton. Mitchell currently
operates a Subaru dealership at 71 Albany Turnpike. If
granted a Jeep dealership, Mitchell plans to build a
new facility for Subaru at 91 Albany Turnpike and to
renovate the proposed location at 71 Albany Turnpike
for the CDJR dealership. The proposed location is
already zoned for an auto dealership. The expert for
the protesting dealers admitted that it is very difficult
to find dealership locations in the Northeast that are
not severely constrained by space or zoning.
The department acknowledged that a June, 2014 Hart-
ford Market Study by FCA listed Simsbury as one of
FCA’s lowest market priorities in the greater Hartford
market. After Mitchell advised FCA of its plan for the
proposed location, however, FCA changed its priorities.
The department found that such a change was to be
expected.
The department concluded that the increased popu-
larity of SUVs; intense marketing on television, the
Internet, and in print media; and heightened interbrand
competition justify allowing the Jeep line at the pro-
posed location. The department found that it is neces-
sary to balance the interests of consumers, the local
community, the establishing dealer, the vehicle manu-
facturer, and the existing dealers.
Section 42-133dd (c) (9) requires consideration of
‘‘the reasonably expected market penetration of the
line-maker motor vehicle for the community or territory
involved, after consideration of all factors which may
affect said penetration, including, but not limited to,
demographic factors such as age, income, education,
size class preference, product popularity, retail lease
transactions, or other factors affecting sales to consum-
ers of the community or territory . . . .’’ As to this
consideration, the department explained that ‘‘[m]arket
penetration is the share a particular brand gets of a
competitive set. Market penetration is the same as mar-
ket share: how much business is transacted relative to
the business available. Registration effectiveness is how
well a brand does relative to what is expected from the
brand.’’ The department found that in the Hartford sales
locality, Jeep’s existing market share is less than its
expected market share, using 2015 numbers. In that
year, Jeep’s expected market share in the Hartford sales
locality was 9.85 percent, but its actual market share
was 8.24 percent. If Jeep had achieved its expected
market share in 2015, it would have sold 2086 vehicles
in the Hartford sales locality, but in fact it sold only
1744 vehicles.
Section 42-133dd (c) (10) requires consideration of
‘‘the economic impact of an additional franchise or relo-
cated motor vehicle dealership upon the existing motor
vehicle dealers of the same line make in the relevant
market area to be served by the additional franchisee
or relocated motor vehicle dealership . . . .’’ The
department found that the addition of a Jeep dealership
at the proposed location would result in some financial
loss to the existing dealers. Although FCA’s expert con-
tended that there is sufficient lost opportunity from
interbrand competition to have the new dealership
established and not take any sales from the existing
dealers, the protesting dealers testified that the pro-
posed location would cause a financial loss to them
and might result in a reduction of employees, with a
corresponding loss in customer service. The depart-
ment found that the protesting dealers all have well
established Jeep dealerships with well regarded sales
and service departments. It found that ‘‘[o]ne cannot say
that the consumer will abandon the [protesting dealers’]
dealerships and patronize a new dealership such as the
[p]roposed [l]ocation based solely on convenience for
the purchasing of a new Jeep.’’ The department
observed that both FCA and the protesting dealers
acknowledge the significance of Jeep sales to a CDJR
dealership. It found that although motor vehicle sales
have leveled off, Jeep sales are expected to remain
strong, providing continued opportunity for both the
protesting dealers and Mitchell.
Section 42-133dd (c) (11) requires consideration of
‘‘the retail sales and service business transacted by the
existing dealers of the same line make in the market
area to be served by the proposed new or relocated
dealer as compared to the business available to them
during the three-year period immediately preceding
notice.’’ As to this consideration, the department found
that Jeep registration effectiveness in the Hartford sales
locality indicated lost Jeep sales in the years preceding
the notice. In 2015, the Hartford sales locality had the
third lowest registration effectiveness in the state, at
83.6 percent, and the Bristol RMA was at 85.7 percent.
The department found that the protesting dealers have
been in-selling into the Simsbury trade zone, where
there is no new Jeep dealership. It further found that the
establishment of a new Jeep dealership in the Simsbury
trade zone would not prevent the protesting dealers
from continuing to in-sell into the Simsbury trade zone.
The department concluded that, ‘‘[b]ased upon the
evidence presented, and taking into consideration crite-
ria set forth in . . . § 42-133dd, good cause exists for
permitting the establishment of a new Jeep dealer at
71 Albany Turnpike in Canton . . . .’’ It accordingly
dismissed the protests of the protesting dealers and
ordered that FCA may establish a new Jeep dealer at
71 Albany Turnpike in Canton. This appeal followed.
SCOPE OF REVIEW
The plaintiffs appeal pursuant to General Statutes
§ 4-183.5 ‘‘[J]udicial review of the commissioner’s action
is governed by the Uniform Administrative Procedure
Act . . . General Statutes §§ 4-166 through 4-189 . . .
and the scope of that review is very restricted . . . .’’
[R]eview of an administrative agency decision requires
a court to determine whether there is substantial evi-
dence in the administrative record to support the
agency’s findings of basic fact and whether the conclu-
sions drawn from those facts are reasonable.’’ (Citation
omitted; internal quotation marks omitted.) Murphy v.
Commissioner of Motor Vehicles, 254 Conn. 333, 343,
757 A.2d 561 (2000). ‘‘Substantial evidence exists if the
administrative record affords a substantial basis of fact
from which the fact in issue can be reasonably inferred.’’
(Internal quotation marks omitted.) Schallenkamp v.
DelPonte, 229 Conn. 31, 40, 639 A.2d 1018 (1994). ‘‘The
substantial evidence rule imposes an important limita-
tion on the power of the courts to overturn a decision
of an administrative agency . . . and to provide a more
restrictive standard of review than standards embody-
ing review of weight of the evidence or clearly errone-
ous action.’’ (Internal quotation marks omitted.) Cadler-
ock Properties Joint Venture, L.P. v. Commissioner of
Environmental Protection, 253 Conn. 661, 676, 757 A.2d
1 (2000), cert. denied, 531 U.S. 1148, 121 S. Ct. 1089,
148 L. Ed. 2d 963 (2001). ‘‘In determining whether an
administrative finding is supported by substantial evi-
dence, the reviewing court must defer to the agency’s
assessment of the credibility of witnesses. . . . The
reviewing court must take into account contradictory
evidence in the record . . . but the possibility of draw-
ing two inconsistent conclusions from the evidence
does not prevent an administrative agency’s finding
from being supported by substantial evidence . . . .’’
(Internal quotation marks omitted.) Frank v. Dept. of
Children & Families, 312 Conn. 393, 411–12, 94 A.3d
588 (2014).
Our Supreme Court has repeatedly stated that
‘‘administrative tribunals are not strictly bound by the
rules of evidence and . . . may consider exhibits [that]
would normally be incompetent in a judicial proceed-
ing, [as] long as the evidence is reliable and probative.’’
Lawrence v. Kozlowski, 171 Conn. 705, 710, 372 A.2d
110 (1976), cert. denied, 431 U.S. 969, 97 S. Ct. 2930,
53 L. Ed. 2d 1066 (1977). ‘‘It is axiomatic, moreover, that
it is within the province of the administrative hearing
officer to determine whether evidence is reliable . . .
and, on appeal, the plaintiff bears the burden of proving
that the commissioner, on the facts before him, acted
contrary to law and in abuse of his discretion . . . .
Neither this court nor the [Appellate Court] may retry
the case or substitute its own judgment for that of
the [hearing officer with respect to] the weight of the
evidence or questions of fact. . . . Our ultimate duty
is to determine, in view of all of the evidence, whether
the agency, in issuing its order, acted unreasonably,
arbitrarily, illegally or in abuse of its discretion.’’ (Cita-
tions omitted; internal quotation marks omitted.) Do v.
Commissioner of Motor Vehicles, 330 Conn. 651, 667–
68, 200 A.3d 681 (2019).
Section 4-183 (j) requires affirmance of an agency’s
decision unless the court finds that substantial rights
of the person appealing have been prejudiced by the
claimed error. ‘‘The complaining party has the burden
of demonstrating that its substantial rights were preju-
diced by the error.’’ (Internal quotation marks omitted.)
Miller v. Dept. of Agriculture, 168 Conn. App. 255, 266,
145 A.3d 393, cert. denied, 323 Conn. 936, 151 A.3d 386
(2016). ‘‘It is fundamental that a plaintiff has the burden
of proving that the [agency], on the facts before [it],
acted contrary to law and in abuse of [its] discretion
. . . .’’ (Internal quotation marks omitted.) Murphy v.
Commissioner of Motor Vehicles, supra, 254 Conn.
343–44.
DISCUSSION
The plaintiffs advance three arguments in support
of their appeal. First, they assert that the department
committed legal error by failing to make specific find-
ings as to each of the eleven statutory considerations for
each protesting dealer. Second, they assert that certain
factual findings are not supported by substantial evi-
dence and that two of the findings are inconsistent with
each other. Third, they argue that the department’s legal
conclusion does not follow legally and logically from
certain undisputed facts. More generally, they argue
that the protesting dealers were successful Jeep dealers
and consistently exceeded FCA’s goals; that FCA’s deci-
sion to add a Jeep dealer in Canton was based on the
personal preference of a single manager who had for-
merly worked for Toyota and wanted Jeep to be located
near Toyota; and that the evidence showed a con-
tracting automobile market, a stagnant population,
‘‘extreme’’ Jeep competition, and an insufficient supply
of Jeeps for current dealers.
In response, FCA argues that the plaintiffs’ arguments
are waived, contradict the arguments they made before
the department, misconstrue the dealer statute, and
are legally immaterial. FCA also argues that substantial
evidence supports the department’s decision. The
department argues that the hearing officer properly con-
sidered all the statutory factors as to all of the plaintiffs,
that the findings are not inconsistent and are supported
by substantial evidence, and that the department is
afforded considerable discretion in weighing the statu-
tory factors.
The court has reviewed the entire administrative
record, including the transcripts, the exhibits, the post-
hearing briefs, and the final decision. Based on its
review, it concludes that the plaintiffs have not met
their burden of showing any prejudicial error.
A
The plaintiffs’ first argument is that the hearing offi-
cer failed to make specific findings as to each dealer
on each statutory point, thereby depriving certain of
the plaintiffs of their right to a decision based on their
own circumstances. Similar arguments have been
rejected at least twice in the past. See A-1 Auto Service,
Inc. v. Dept. of Motor Vehicles, Superior Court, judicial
district of Hartford-New Britain, Docket No. CV-96-
0558549 (July 18, 1996) (Maloney, J.) (basis of hearing
officer’s decision was clear despite failure to state sub-
ordinate conclusions as to some factors); Mario D’Ad-
dario Buick, Inc. v. Dept. of Motor Vehicles, Superior
Court, judicial district of New Britain, Docket No. CV-
XX-XXXXXXX-S (October 12, 2001) (Schuman, J.) (hearing
officer not required to make specific findings on each
factor but merely to consider them all). Courts have
considered whether the basis for the ultimate conclu-
sion is clear and reflects consideration of the statutory
factors. In A-1 Auto Service, Inc., the court observed
that the hearing officer’s ultimate conclusion was sim-
ply that ‘‘ ‘existing circumstances’. . . do not establish
good cause for denying the new franchise. As noted,
the findings of fact are explicit and thorough; they com-
pletely cover the circumstances as required by the stat-
ute; and they provide an understandable and reasonable
basis for the ultimate decision. If the hearing officer
failed to label some subordinate conclusions as such
or failed to state some subordinate conclusions explic-
itly, the plaintiff has not demonstrated any material
prejudice as a result.’’
The plaintiffs here claim that the department failed
to make findings about Northwest and Crowley as to
the fifth, ninth, and eleventh statutory factors. The fifth
factor directs the department to consider ‘‘whether the
dealers of the same line make in that relevant market
area are providing adequate competition and conve-
nient customer care for the motor vehicles of the line
make in the market area including the adequacy of
motor vehicle sales and service facilities, equipment,
supply of motor vehicle parts, and qualified service
personnel . . . .’’ General Statutes § 42-133dd (c) (5).
Contrary to the plaintiffs’ claim, the department
expressly found that all of the protesting dealers have
adequate service facilities, equipment, supply of motor
vehicle parts, and qualified service personnel. Final
Decision, ¶ 25. Turning from service to sales, the depart-
ment observed that the Simsbury trade zone has never
had a new Jeep dealership, with the result that consum-
ers in that trade zone had to search for and purchase
new Jeeps outside the area. It further observed that
while the dealers in the Hartford sales locality met their
minimum sales requirements, registration effectiveness
(a measure of market share) was only 84 percent. In
sum, the department found that dealers of the same
line make were providing adequate competition in ser-
vice but not adequate or convenient competition in sales
of new Jeeps in the proposed location. This conclusion
was supported by substantial evidence in the record.
The plaintiffs also claim that the department failed to
make necessary findings about the ninth factor, which
directs the department to consider ‘‘the reasonably
expected market penetration of the line-maker motor
vehicle for the community or territory involved, after
consideration of all factors which may affect said pene-
tration, including, but not limited to, demographic fac-
tors such as age, income, education, size class prefer-
ence, product popularity, retail lease transactions, or
other factors affecting sales to consumers of the com-
munity or territory . . . .’’ General Statutes § 42-133dd
(c) (9). The plaintiffs claim that the department erred
in failing to focus on Canton, the proposed location,
as ‘‘the community or territory involved.’’ The court
disagrees. The statute employs undefined
alternatives—‘‘community or territory involved’’—
rather than the statutorily defined ‘‘relevant market
area.’’ By using broad, undefined alternative terms, the
statute clearly affords the department substantial dis-
cretion to determine the most relevant ‘‘community or
territory involved.’’ The department did not abuse its
discretion in focusing on the Hartford sales locality in
which the proposed location was located. Substantial
evidence supports the department’s finding that Jeep’s
market share in the Hartford sales locality was 8.24
percent, lower than its expected market share of 9.85
percent, with sales of only 1744 vehicles as compared
to expected sales of 2086 vehicles.
The plaintiffs also claim that the department erred
by failing to make specific findings concerning the retail
sales of Jeeps in Canton and in Northwest’s relevant
market area, as they claim is required by the eleventh
factor. That factor requires the department to consider
‘‘the retail sales and service business transacted by the
existing dealers of the same line make in the market
area to be served by the proposed new or relocated
dealer as compared to the business available to them
during the three-year period immediately preceding
notice.’’ General Statutes § 42-133dd (c) (11). The plain-
tiffs claim that the department was required to make
specific findings as to market penetration in the ‘‘Can-
ton/Simsbury market’’ as well as the Bristol and North-
west sales localities. The department and FCA disagree.
They argue that the hearing officer correctly discussed
the Hartford sales locality as ‘‘the market area to be
served by the proposed new or relocated dealer.’’ The
court agrees with the defendants. Subsection (c) (11)
requires consideration of the market area to be served
by the proposed new Jeep dealer. The department rea-
sonably focused on the Hartford sales locality in which
the new dealership would be established. It observed
that registration effectiveness, an industry measure of
market share, indicated lost sales in the Hartford sales
locality and in the Bristol relevant market area as well.
It further noted that the protesting dealers had been
in-selling into the Simsbury trade zone for years and
could continue to do so after a new Jeep dealership
was established.
As FCA argues, many of the statutory factors overlap
with each other. By focusing on alleged failures with
respect to specific factors, the plaintiffs ignore the fact
that many of the findings relate to more than one factor.
Review of the decision as a whole demonstrates that
the department considered each protesting dealer’s
sales and service activities in its relevant market area.
It identified each of the protesting dealers and their
relevant market areas. Final Decision, ¶¶ 1, 12 and
13. It acknowledged their significant and permanent
investments in their dealerships. Id., ¶ 15. It found that
all the protesting dealers provided adequate competi-
tion in the service of vehicles and met their minimum
sales responsibility under their agreements with FCA.
Id., ¶¶ 25 and 28. It found, however, that registration
effectiveness in the Hartford sales locality was only
84 percent, despite the fact that all protesting dealers
advertised in, and made sales into, that sales locality.
Id., ¶¶ 26 through 28 and 37.
The department construed § 42-133dd (c) as requiring
the department to balance ‘‘the interests of consumers,
the local community, the establishing dealer, the vehicle
manufacturer, and the existing dealers . . . .’’ Id., ¶ 43.
This was clearly correct. Section 42-133dd (c) evidences
concern for existing dealers in subdivisions (1), (5), (8),
(10) and (11). Concern for the consuming public, and
for competition generally, is explicitly addressed in sub-
divisions (3), (4) and (5) and implicit in several other
subdivisions. Concern for fairness to the manufacturer
is explicit or implicit in subdivisions (2), (3), (5) and (9).
Concern for relocating dealers is expressly addressed
in subdivision (7). Section 42-133dd (c) does not exist
solely to protect the interests of existing dealers, but
to assure healthy competition in the market. Healthy
competition, the statute assumes, is good for the con-
suming public and ultimately benefits manufacturers
and dealers as well. The final decision as a whole
reflects the department’s consideration of the factors
set out in the statute.
B
The plaintiffs next argue that the department’s find-
ings as to subdivisions (6), (7) and (8) are not supported
by substantial evidence, and that the findings as to
subdivisions (3) and (10) are irreconcilable. ‘‘In deter-
mining whether an administrative finding is supported
by substantial evidence, a court must defer . . . to the
agency’s right to believe or disbelieve the evidence pre-
sented by any witness, even an expert, in whole or in
part.’’ (Internal quotation marks omitted.) Bancroft v.
Commissioner of Motor Vehicles, 48 Conn. App. 391,
400, 710 A.2d 807, cert. denied, 245 Conn. 917, 717 A.2d
234 (1998).
Under subdivision (6), the department found that on
balance, allowing the addition of a Jeep dealership at
the proposed location would increase competition.
Final Decision, ¶ 31. The plaintiffs dispute this finding,
arguing that the evidence demonstrated that vehicle
pricing is at historically low levels in the relevant market
areas. They also argue that there were not enough Jeep
vehicles to meet demand. Finally, they argue that com-
petition for Jeep service cannot be enhanced because
Mitchell already performs Jeep service at its present
location.
The plaintiffs’ arguments are not well founded. There
was substantial evidence that locating a dealership in
an auto row near dealerships of competing brands
increases interbrand competition. Such evidence came
not only in the testimony of FCA’s dealer placement
managers and its expert witness, but also in the admis-
sions of some of the protesting dealers on cross-exami-
nation. Jonathan Gengras, for instance, admitted that
being in an auto row ‘‘stimulates competition to be
among a number of dealerships where consumers can
cross-shop.’’ Transcript, May 22, 2017, p. 155. He further
admitted that the proposed location was part of an auto
row and was a ‘‘great location to shop for a vehicle.’’ Id.,
pp. 155–56. Domenic Papa admitted that competition
provides consumers with better prices, better choices,
and better attention from the dealers. Transcript, May
19, 2017, pp. 14–15.
The plaintiffs’ claim that there were not enough Jeeps
to meet demand was countered by evidence that FCA
was building a second plant for Jeep Wranglers, one of
the most popular models, and expected to increase
production enough to increase sales by 24 percent
within a couple of years. The hearing officer credited
this evidence. See Final Decision, ¶ 36.
The plaintiffs’ claim that competition for Jeep service
would not be enhanced because Mitchell already ser-
vices Jeeps is not persuasive. There was evidence that
Mitchell was at a disadvantage in getting Jeep service
work because many customers choose to service their
vehicles at the dealership where they purchased it.
Indeed, there was evidence that dealers use the point
of sale to try to sell service contracts to enhance the
likelihood that purchasers will return to that dealership
for service.
The plaintiffs also claim that the department’s find-
ings with regard to subdivision (7) are not relevant to
the analysis and not supported by substantial evidence.
Subdivision (7) directs the department to consider the
effect of a denial of a relocation request on a relocating
dealer. The department acknowledged, in the final deci-
sion, that it was not required to address subdivision (7)
because the protests before it involved the establish-
ment of a new Jeep dealer rather than the relocation
of an existing one. It noted, however, that the list of
factors in § 42-133dd (c) is nonexclusive and deemed
it appropriate to consider the effect of denying the Jeep
line to Mitchell. It found that the negative financial
impact on Mitchell was well documented; Mitchell had
been losing money at its present location for years. It
also considered the possibility that Mitchell would be
forced to relinquish its CDR franchise if not granted
Jeep. It considered that termination of Mitchell’s CDR
franchise would adversely affect consumers who are
presently using Mitchell’s services at its present loca-
tion.
The plaintiffs assert that the department’s finding was
not supported by substantial evidence because Mitch-
ell’s president admitted that Mitchell had remained in
business throughout the recession and that, if he
decided to stop operating the existing CDR franchise,
he could sell it. But, as before, the plaintiffs discuss
only the evidence that was favorable to their position
and ignore the substantial evidence that supports the
department’s findings. The plaintiffs do not dispute that
Jeep sales constitute 60 to 70 percent of the new vehicle
sales at their dealerships. As demand for SUVs has
increased, there has been a corresponding decrease in
the demand for sedans. FCA managers testified that
Jeep and light truck sales have driven the success of
the business in recent years. Without the ability to sell
new Jeeps, Mitchell is at a substantial disadvantage in
relation to the dealers who sell all the CDJR lines. Mitch-
ell testified that his CDR dealership had been losing
money for at least six years and that if he was not
allowed to add Jeep he would have to think ‘‘long and
hard’’ about whether to continue to operate it. William
Doucette, the dealer placement manager for FCA’s
Northeast region, testified that Mitchell was at a sub-
stantial disadvantage without Jeep. He testified that
Mitchell had been unable to make needed upgrades to
its Simsbury facility because it lacked the revenue from
Jeep sales to support such an investment. Doucette
thought it likely that Mitchell would voluntarily termi-
nate his CDR franchise if he could not add Jeep. The
department did not err in considering that denying the
Jeep line to Mitchell would adversely affect its business.
The plaintiffs also argue that the department’s find-
ings as to subdivision (8) are not supported by substan-
tial evidence. Section 42-133dd (c) (8) requires the
department to consider ‘‘whether the establishment or
relocation of the proposed dealership appears to be
warranted and justified based on economic and market-
ing conditions pertinent to dealers competing in the
community or territory, including anticipated future
changes . . . .’’ The plaintiffs first argue that the
department improperly focused on historical conditions
and failed to give adequate attention to ‘‘anticipated
future changes . . . .’’ More specifically, they claim
that the automotive industry is expected to contract,
that there are no ‘‘growth projects’’ in Canton, and
school enrollment is decreasing. They next argue that
the department failed to reconcile FCA’s evolving ‘‘justi-
fications’’ for the new Jeep dealership. They point to a
June, 2014 market study which showed that FCA did
not believe there was a market justification for adding
Jeep in Canton at that time, and then assert that FCA
reversed course in August, 2014, when Mitchell first
proposed to relocate to Canton and add the Jeep brand
there. The plaintiffs claim that the only thing that
changed was the availability of the Canton property
and an FCA manager’s desire to be near Toyota.
The claim that the department failed to consider
existing economic and marketing factors and antici-
pated future changes is refuted by the decision.
Although some of the findings are addressed under
headings other than the heading specifically discussing
subdivision (8), it is clear that the hearing officer consid-
ered the slowing population growth (¶ 18), the peak
and plateau of vehicle sales in 2016 (¶ 19), the plaintiffs’
argument that the slowing of population and household
growth supported denial of the Jeep addition (¶ 20),
the marketing advantages of locating a dealership on
an auto row (¶ 21), the increase in new vehicle sales
between 2009 and 2016, with a 172.5 percent increase
in the sale of Jeeps (¶ 34), the importance of the Jeep
line to FCA dealers, contributing 60 to 70 percent of
all FCA’s sales in the United States (¶ 36), FCA’s inten-
tion to increase production of Jeeps and to introduce
new Jeep models, with its expectation of increasing
Jeep sales by 24 percent by 2020 (¶ 36), and the recogni-
tion that while existing dealers sell into the Simsbury
trade zone, most of their sales are made near their
dealerships (¶ 37). The department further observed
that the existing dealers who had dealerships for brands
other than FCA brands were already competing with
dealers in Canton—for instance, Northwest’s auto
group includes a Chevrolet dealership in Torrington
that competes with a Chevy dealership less than a mile
from the proposed location for Mitchell’s Jeep dealer-
ship, and Crowley’s Nissan dealership in Bristol com-
petes with Hoffman Nissan in Canton. The department
cited to specific testimony and exhibits that supported
its findings. The department did not fail to conduct a
proper analysis of economic and marketing conditions,
including anticipated future changes; it simply dis-
agreed with the plaintiffs’ view of the evidence. That it
chose to credit FCA’s witnesses and expert more often
than the plaintiffs’ was its prerogative as the finder of
fact. As our Supreme Court and Appellate Court have
observed, ‘‘ ‘weighing the accuracy and credibility of the
evidence’ is the province of the administrative agency.
Connecticut Natural Gas Corp. v. Public Utilities Con-
trol Authority, 183 Conn. 128, 136, 439 A.2d 282 (1981).
Reviewing courts thus ‘must defer to the agency’s
assessment of the credibility of the witnesses and to
the agency’s right to believe or disbelieve the evidence
presented by any witness, even an expert, in whole or
in part.’ Briggs v. State Employees Retirement Com-
mission, 210 Conn. 214, 217, 554 A.2d 292 (1989); see
also Standard Oil of Connecticut, Inc. v. Administra-
tor, Unemployment Compensation Act, 320 Conn. 611,
623, 134 A.3d 581 (2016) (reviewing court cannot ‘substi-
tute its own judgment for that of the administrative
agency on the weight of the evidence’ . . .); Tarasovic
v. Zoning Commission, 147 Conn. 65, 69, 157 A.2d 103
(1959) (‘[i]t is not the function of the court to pass upon
the credibility of the evidence heard’ by administrative
agency).’’ Fagan v. Stamford, 179 Conn. App. 440, 458,
180 A.3d 1 (2018).
The plaintiffs’ emphasis on FCA’s June, 2014 market
study is equally unavailing. The hearing officer acknowl-
edged that in a June, 2014 study, FCA ranked four com-
munities as higher priorities for improved performance
than Canton/Simsbury, but a follow-up study in August
of 2014 recommended relocating Mitchell to the pro-
posed location and adding the Jeep line.6 Final Decision,
¶ 39. The hearing officer concluded that it was reason-
able for FCA to adjust its priorities, in light of the popu-
larity of the Jeep line, when Mitchell offered it the
opportunity to locate a CDJR dealership at a highly
visible location, on a busy thoroughfare, in close prox-
imity to competing dealerships, that was already zoned
for an auto dealership. Id., ¶¶ 21, 36, 38, 42 and 44. As
the plaintiffs’ own expert admitted, in the Northeast it
is very difficult to find dealership locations with good
frontage and good buildings that are not severely con-
strained by space or zoning. Id., ¶ 42. The plaintiffs
disagree with the department’s judgment, but it is one
that was well supported by the evidence and well within
the discretion afforded the department.
The plaintiffs repeatedly argue that the sole reason
for FCA’s change in priorities was that its market repre-
sentative, Dan Cantrell, had previously been employed
by Toyota and personally desired to locate Jeep dealer-
ships near Toyota dealerships. Plaintiffs’ Brief, pp. 3,
4, 15, 16, 20, 22 and 23. This argument ignores the
testimony of FCA national and regional dealer place-
ment managers, who testified about the importance
of locating dealerships near their competitors, a fact
acknowledged by the plaintiffs’ witnesses as well. It
also ignores the analysis in FCA’s expert report, which
the hearing officer cited frequently throughout the final
decision. The hearing officer was entitled to reject the
plaintiffs’ argument and to credit the substantial evi-
dence presented by FCA as to the competitive impor-
tance of locating dealerships near their main com-
petitors.
The plaintiffs also argue that two of the department’s
subordinate findings are ‘‘incompatible.’’ Under § 42-
133dd (c) (3), which considers the effect on the consum-
ing public, the department found that the consuming
public would benefit from the addition of the Jeep line
at the proposed location because it is convenient to
shop and compare competing brands in an auto row
and because it would reduce drive times to a dealership.
Final Decision, ¶¶ 21 and 22. Under § 42-133dd (c)
(10), which considers the economic impact of a new
dealership on existing dealers, the department found
that consumers would not abandon existing dealers
solely based on convenience. Id., ¶ 50. These findings
are not inconsistent. As the department found, both
FCA and the protesting dealers presented evidence that
there would be some financial loss to existing dealers
as the result of the addition of a Jeep dealership at the
proposed location, but the probable amount of the loss
was vigorously disputed. Id., ¶ 47. FCA presented evi-
dence that there was sufficient lost opportunity to have
the proposed location come into business and not take
any sales from the existing dealers, while the protesting
plaintiffs presented evidence that the proposed location
would affect them economically and possibly require
them to reduce the number of their employees. Consid-
ering the conflicting evidence, the department found
that the protesting dealers ‘‘all have well established
Jeep dealerships, with [well regarded] sales and ser-
vices departments. One cannot say that the consumer
will abandon the [protesting dealers’] dealerships and
patronize a new dealership such as the [p]roposed
[l]ocation based solely on convenience for the purchas-
ing of a new Jeep.’’ Id., ¶ 50. The department concluded
that because Jeep sales are expected to remain strong,
there would be ‘‘ample opportunity’’ for both the pro-
testing dealers and Mitchell. Id., ¶ 51.
Under subdivision (3), the department found that
addition of a Jeep dealership at the proposed location
would be convenient for the consuming public and
would reduce drive times to Jeep dealerships. Under
subdivision (10), however, it found that convenience
would not be the sole factor considered by consumers.
It found that the protesting dealers had well established
and well regarded dealerships. It is not unreasonable
to infer that some consumers may prefer to continue
to do business with dealers they know and trust even if
a new dealer is more convenient. Moreover, a principal
reason for locating a dealership in an auto row is to
increase interbrand competition. There was substantial
evidence to support the finding that Jeep sales were
expected to remain strong and that there was ‘‘ample
opportunity’’ for both the protesting dealers and for
Mitchell, including improving Jeep’s market share in
comparison to other brands. The department’s findings
are not inconsistent. It is not unreasonable to find that
consumer behavior is affected by many factors, includ-
ing convenience, loyalty, and proximity to competing
choices.
C
The plaintiffs’ final argument is that the department’s
ultimate conclusion—that there is good cause to add
a Jeep dealership at the proposed location—cannot fol-
low legally and logically from the undisputed facts. The
plaintiffs present a list of purported ‘‘undisputed’’ facts,
some of which are undisputed, some of which are not
material, and some of which were disputed or coun-
tered by other evidence. It is undisputed, for instance,
that the protesting dealers are located within fourteen
miles of the proposed location; that is what gave them
the right to file a protest. Several of the purported facts
deal with Jeep sales in Canton. Even if undisputed,
those facts would not be dispositive because the rele-
vant market areas were larger than Canton. The plain-
tiffs assert that there is no FCA policy to place Jeep
near Toyota; even if true, this assertion certainly ignores
abundant evidence that FCA preferred to locate dealer-
ships in auto rows, in close proximity to competing
brands, to enhance interbrand competition. The plain-
tiffs assert that they all met their minimum sales require-
ments and had not been told they needed to improve
their sales in their assigned markets or in Canton. But,
as the department found, the manufacturer had wanted
to establish a Jeep dealership in the Simsbury trade
zone since 2007, when it first proposed to add Jeep to
the Mitchell franchise in Simsbury. Its previous effort
to add Jeep in the Simsbury trade zone provided notice
that it believed that the Jeep brand was not adequately
represented there.
In sum, the department did its job: it considered the
evidence presented by the plaintiffs, it considered the
evidence presented by FCA and Mitchell, and it decided
which evidence to credit. It cited frequently to the testi-
mony and report of FCA’s expert, indicating that it
found that evidence to be credible. It weighed the inter-
ests of the existing dealers, the consuming public, the
community affected, the manufacturer, and the dealer
to be most affected by its decision, Mitchell. Despite
the plaintiffs’ efforts to recast these matters as legal
issues, the issues identified by the plaintiffs are factual
in character, and the ultimate conclusion is one in which
the department is afforded considerable discretion. It
is not the role of this court to second-guess the factual
findings and discretionary decisions of an administra-
tive agency. See Frank v. Dept. of Children & Families,
supra, 312 Conn. 411–12 (‘‘[t]he reviewing court must
take into account contradictory evidence in the record
. . . but the possibility of drawing two inconsistent
conclusions from the evidence does not prevent an
administrative agency’s finding from being supported
by substantial evidence’’ (internal quotation marks
omitted)).
CONCLUSION
The department’s decision adequately addressed the
statutory circumstances it was directed to consider. Its
factual findings are supported by substantial evidence
and are not inconsistent or incomplete. Accordingly,
the department’s decision must stand, and the plaintiffs’
appeal is dismissed. Judgment shall enter for the
defendants.
* Affirmed. Northwest Hills Chrysler Jeep, LLC v. Dept. of Motor Vehicles,
201 Conn. App. , A.3d (2020).
1
General Statutes § 42-133dd (a) provides in relevant part: ‘‘In the event
that a manufacturer or distributor seeks to enter into a franchise establishing
a new dealer or relocating an existing dealer within or into a relevant market
area where the same line make is then represented, the manufacturer or
distributor shall in writing, by certified mail, first notify the commissioner
and each dealer in such line make in the relevant market area of its intention
to establish a new dealer or to relocate an existing dealer within or into
that market area. Within twenty days of receiving such notice or within
twenty days after the end of any appeal procedure provided by the manufac-
turer or distributor, any such dealer may file with the commissioner a protest
concerning the proposed establishment or relocation of such new or existing
dealer. When such a protest is filed, the commissioner shall inform the
manufacturer or distributor that a timely protest has been filed, and that
the manufacturer or distributor shall not establish or relocate the proposed
dealer until the commissioner has held a hearing, nor thereafter, if the
commissioner determines that there is good cause for denying the establish-
ment or relocation of such dealer. In any hearing held pursuant to this
section, the manufacturer or distributor has the burden of proving that good
cause exists for permitting the proposed establishment or relocation. . . .’’
2
General Statutes § 42-133dd (c) provides: ‘‘In determining whether good
cause has been established for not entering into a franchise establishing a
new dealer or relocating an existing dealer for the same line make, the
commissioner shall take into consideration the existing circumstances,
including, but not limited to: (1) The permanency and size of investment
made and the reasonable obligations incurred by the existing new motor
vehicle dealers in the relevant market area; (2) growth or decline in popula-
tion and new car registrations in the relevant market area; (3) effect on the
consuming public in the relevant market area; (4) whether it is injurious or
beneficial to the public welfare for a new dealer to be established; (5)
whether the dealers of the same line make in that relevant market area are
providing adequate competition and convenient customer care for the motor
vehicles of the line make in the market area including the adequacy of motor
vehicle sales and service facilities, equipment, supply of motor vehicle parts,
and qualified service personnel; (6) whether the establishment of a new
dealer would increase or decrease competition; (7) the effect on the relocat-
ing dealer of a denial of its relocation into the relevant market area; (8)
whether the establishment or relocation of the proposed dealership appears
to be warranted and justified based on economic and marketing conditions
pertinent to dealers competing in the community or territory, including
anticipated future changes; (9) the reasonably expected market penetration
of the line-maker motor vehicle for the community or territory involved, after
consideration of all factors which may affect said penetration, including,
but not limited to, demographic factors such as age, income, education,
size class preference, product popularity, retail lease transactions, or other
factors affecting sales to consumers of the community or territory; (10) the
economic impact of an additional franchise or relocated motor vehicle
dealership upon the existing motor vehicle dealers of the same line make
in the relevant market area to be served by the additional franchisee or
relocated motor vehicle dealership; and (11) the retail sales and service
business transacted by the existing dealers of the same line make in the
market area to be served by the proposed new or relocated dealer as com-
pared to the business available to them during the three-year period immedi-
ately preceding notice.’’
3
Over seven days in May, 2017, a department hearing officer conducted
the required hearing. He heard testimony from four FCA managers, a repre-
sentative of each of the protesting dealers, the president of Mitchell [Dodge,
Inc.], two expert witnesses for FCA, and two expert witnesses for the
protesting dealers. FCA and the protesting dealers introduced some 190
exhibits and submitted posthearing briefs. The hearing officer subsequently
issued a final decision on January 19, 2018, from which these facts are
drawn. (The decision is misdated January 19, 2017, on the first page, but
correctly dated on page 11.)
4
Pursuant to § 42-133dd (b) (1), the protest provisions of § 42-133dd (a)
do not apply to ‘‘the relocation of an existing dealer within that dealer’s
area of responsibility under its franchise, provided that the relocation shall
not be at a site within six miles of a licensed dealer for the same line make
of motor vehicle . . . .’’
Mitchell’s proposed relocation was within its area of responsibility and
was more than six miles from the protesting CDJR dealers.
5
General Statutes § 4-183 (j) sets out the statutory scope of review for
administrative appeals. It provides: ‘‘The court shall not substitute its judg-
ment for that of the agency as to the weight of the evidence on questions
of fact. The court shall affirm the decision of the agency unless the court
finds that substantial rights of the person appealing have been prejudiced
because the administrative findings, inferences, conclusions, or decisions
are: (1) In violation of constitutional or statutory provisions; (2) in excess
of the statutory authority of the agency; (3) made upon unlawful procedure;
(4) affected by other error of law; (5) clearly erroneous in view of the
reliable, probative, and substantial evidence on the whole record; or (6)
arbitrary or capricious or characterized by abuse of discretion or clearly
unwarranted exercise of discretion. If the court finds such prejudice, it
shall sustain the appeal and, if appropriate, may render a judgment under
subsection (k) of this section or remand the case for further proceedings.
For purposes of this section, a remand is a final judgment.’’
6
FCA’s national head of market representation, Bashar Cholagh, testified
that the June, 2014 analysis was a preliminary study, based primarily on
data from 2013, and the August, 2014 study was updated to reflect data
through April and May of 2014, as well as insights gained from driving the
market area in July, 2014. Notably, the June, 2014 study identified lost sales
opportunities in the Hartford market area and recommended putting a CDJR
dealership in the Simsbury trade zone. See Exhibit R2, Bates Stamp 9656.
The June, 2014 study also included a trade zone map that indicated the
importance of locating CDJR dealerships in auto rows near their main
competitors. Id., Bates Stamp 9686.