Bankruptcy judge gives Ford, Toyota permission to sever RDAG relationships

LUBBOCK -- Bankruptcy Court Judge Robert L. Jones granted Ford Motor Credit Co. and Gulf State Toyota’s requests to stop doing business with Reagor-Dykes Auto Group.

In separate rulings, the judge authorized Gulf State Toyota’s November motion to terminate the creditor’s relationship with Reagor-Dykes Plainview. The dealership agreement can be terminated as of Jan. 25.

Jones also ruled in favor of Ford Credit, giving it permission to repossess its vehicles. In his decision, he states the parties can still work out an agreement, but that Reagor-Dykes must cooperate with the ruling.

In Ford Credit’s original motion, they argued their collateral is losing value as it sits at Reagor-Dykes dealerships, and they should be allowed to seize vehicles. Reagor-Dykes countered, calling the Ford Credit’s motion “nuclear,” and stated that if confirmed, the reorganization plan proposed in court would need vehicles like those owned by Ford Credit to recapitalize the business.

Read more: https://www.lubbockonline.com/news/20190117/bankruptcy-judge-gives-ford-toyota-permission-to-sever-rdag-relationships

The judge's decision is correct. RDAG committed fraud by obtaining financing for vehicles that they never sold.