F:\LMVC Meetings\2017 Commission Meetings\July 10, 2017\LMVC\July

$F:\LMVC Meetings\2017 Commission Meetings\July 10, 2017\LMVC\July$ MINUTES OF THE LOUISIANA MOTOR VEHICLE COMMISSION 3519 12th Street Metairie, Louisiana 70002 Monday, July 10, 2017 The meeting was called to order at 10:00 a.m. by Chairman Raymond J. Brandt. Present were: Chairman Raymond J. Brandt Commissioner Allen O. Krake Commissioner V. Price LeBlanc, Jr. Commissioner Gregory Lala Commissioner Harold H. Perrilloux Commissioner Eric R. Lane Commissioner Stephen L. Guidry, Jr. Commissioner Kenneth “Mike” Smith Commissioner Keith P. Hightower Commissioner Keith M. Marcotte Commissioner Randy Scoggin Commissioner Joseph W. “Bill” Westbrook Commissioner Donna S. Corley Commissioner Terryl J. Fontenot Commissioner Maurice C. Guidry L. A. House, Executive Director Adrian F. LaPeyronnie, III, Counselor Gregory F. Reggie, Counselor Burgess E. McCranie, Jr., Counselor ***************************************************** Also, in attendance were David Adams, Esq., Trey Paulsen, Esq., and Joel Sheltrown, Vice President of Governmental Affairs, representing Elio Motors, Inc.; Jeanne Comeaux, Esq.; Will Green, President of Louisiana Automobile Dealer Association; and Nick Lawton, Reporter with KSLA-TV, and Commission staff: Ingya Cattle, Assistant Executive Director; Commission Investigator Supervisors: Mike Laviolette and Scott Landreneau; Thom Hoeflinger, Commission Investigator; and Stacey Broussard, Administrative Coordinator Supervisor. ***************************************************** The Chairman called to order Hearing #2017-001,Elio Motors, Inc. for alleged violations of LSA-R.S. 32:1252.(35)(a), (46); LSA- R.S. 32:1254.A.(1), (2) & (18); LSA-R.S. 32:1258.A.(3), (5), & (6); LSA-R.S. 32:1261.A.(1)(k)(I); and LSA-R.S. 32:1270.11.(1)(h)(i). Representing Elio Motors, Inc. were David Adams, Esq., Trey Paulsen, Esq., and Joel Sheltrown, Vice President of Governmental Affairs. A court reporter was brought in to record the transcript of the hearing, which will be made a permanent part of the Commission’s files. The following Judgment was rendered. IN RE: Hearing #2017-001 Elio Motors, Inc. 7600 General Motors Boulevard Shreveport, Louisiana 71129 JUDGMENT This cause came to be heard on Monday, July 10, 2017 before the Louisiana Motor Vehicle Commission (the “Commission”). APPEARANCE: Dwight C. Paulsen, III, Esq. and L. David Adams, Esq. of Bradley Murchinson Kelly & Shea LLC, representing Elio Motors, Inc., and Joel Sheltrown, Vice-President of Governmental Affairs, Elio Motors, Inc. Gregory Reggie, Attorney for the Louisiana Motor Vehicle Commission And after hearing the testimony adduced at trial, the receipt of documentary evidence into the record, and for reasons orally assigned, the Commissioners of the Commission make the following findings of fact and conclusions of law: FINDINGS OF FACTS: 1 Elio Motors, Inc. does not possess a Louisiana Motor Vehicle Commission license to conduct business as a Recreational Products Manufacturer; 2 Elio Motors, Inc. does not possess a Louisiana Motor Vehicle Commission license to conduct business as a Recreational Products Dealer; 3 Elio Motors, Inc. is engaged in the business of designing, developing and manufacturing three-wheel vehicles that fit the definition of a motorcycle under Louisiana Revised Statues 32:1252 (30), and such vehicles are considered Recreational Products under 32:1252 (45); 4 While holding itself out as a Manufacturer of vehicles that are defined as Recreational Products, Elio Motors, Inc. has solicited and taken sales reservations from the public for such vehicles totaling over $27.8 million, over a period of at least 51 months; and 5 By soliciting and collecting over $27.8 million dollars in sales reservations for its vehicles, Elio Motors, Inc. engaged in offering to sell Recreational Products as defined in 32:1252 (45) without first obtaining a Louisiana Motor Vehicle Commission License as a Recreational Products Dealer, over a period of at least 51 months. LMVC.07.10.17.#1 CONCLUSIONS OF LAW: 1 By operating as a Manufacturer of Recreational Products without possessing a license from the Louisiana Motor Vehicle Commission, Elio Motors, Inc. violated Louisiana Revised Statute 32:1254(A)(1); and 2 By acting as a Manufacturer of Recreational Products and then offering to sell Recreational Products directly to consumers, Elio Motors, Inc. violated Louisiana Revised Statute 32:1270.11(1)(h)(i); and 3 By acting as a Recreational Products Dealer and offering to sell Recreational Products directly to consumers, Elio Motors, Inc. violated Louisiana Revised Statute 32:1254(A)(18). Considering the forgoing and pursuant to the authority vested in the Louisiana Motor Vehicle Commission set forth in LSA-R.S. 32:1251, et seq.: IT IS ORDERED, ADJUDGED, AND DECREED that Elio Motors, Inc. be and is hereby assessed a fine in the amount of TWO HUNDRED SEVENTY-TWO THOUSAND AND FIVE HUNDRED AND NO/100 ($272,500.00) DOLLARS for operating as a Recreational Products Manufacturer in Louisiana without being licensed by the Louisiana Motor Vehicle Commission as a Manufacturer, and for offering to sell Recreational Products directly to the public as a Manufacturer, all for more than 1530 days. IT IS ORDERED, ADJUDGED, AND DECREED that Elio Motors, Inc. be and is hereby assessed a fine in the amount of TWO HUNDRED SEVENTY-TWO THOUSAND AND FIVE HUNDRED AND NO/100 ($272,500.00) DOLLARS for operating as a Recreational Products Dealer in Louisiana for more than 1,530 days without being licensed by the Louisiana Motor Vehicle Commission as a Recreational Products Dealer. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that ELIO MOTORS, INC. shall produce to the Louisiana Motor Vehicle Commission within sixty (60) days of the signing of this judgment proof of its establishment of a trust account into which all amounts collected for refundable reservation payments are to be deposited and proof of the deposits into such account. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that should ELIO MOTORS, INC. not produce to the Louisiana Motor Vehicle Commission within sixty (60) days of the signing of this judgment proof of its establishment of a trust account into which all amounts collected for refundable reservation payments are to be deposited and proof of the deposits into such trust account, that ELIO MOTORS, INC. be and is hereby fined an additional amount of $5,000.00 per day from the signing of this judgment until the day that ELIO MOTORS, INC. presents proof of the establishment of such trust account and the deposits into such trust account. IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Elio Motors, Inc. further pay the cost of these proceedings, including the Commission’s attorney fees. Judgment read and rendered on the 10th day of July, 2017. Judgment signed this day of July, 2017. __________________________________ Raymond J. Brandt, Chairman Louisiana Motor Vehicle Commission ***************************************************** The Chairman called to order Hearing #2017-023, TaoTao USA, Inc. The Executive Director advised no one was in attendance from TaoTao USA, Inc. and the certified mail return receipt card indicating TaoTao USA, Inc. had been properly noticed had not been received by the Commission. Counselor Reggie asked that the hearing be continued until such time as it could be shown that TaoTao USA, Inc. had been properly served with the Hearing Notice. Chairman Brandt continued Hearing #2017-023, TaoTao USA, Inc. ***************************************************** The Executive Director presented the Commission Members a copy of the updated Louisiana Motor Vehicle Commission Law through the 2017 Regular Session of the Louisiana Legislature. At this time, Counselor McCranie outlined the changes and/or additions which occurred during the 2017 Regular Legislative Session. Counselor McCranie advised the additions and/or changes would become effective June 3, 2017. LOUISIANA REVISED STATUTES TITLE 32. MOTOR VEHICLES AND TRAFFIC REGULATION Current through the 2017 Regular Session CHAPTER 6. PART 1 GENERAL PROVISIONS APPLICABLE TO MOTOR VEHICLES AND RECREATIONAL PRODUCTS §1251. Declaration of public policy The legislature finds and declares that the distribution and sale of motor vehicles and recreational products in the state of Louisiana vitally affects the general economy of the state, the public interest, and the public welfare, and that in order to promote the public interest, and the public welfare, and in the exercise of its police power, it is necessary to regulate and to license those persons enumerated in R.S. 32:1254 and doing business in Louisiana, in order to prevent frauds, impositions, and other abuses upon its citizens, and avoid undue control of the independent motor vehicle dealer and recreational products by their motor vehicle manufacturing and distributive organizations and foster and keep alive vigorous and healthy competition, by prohibiting unfair practices by which fair and honest competition is destroyed or prevented, and to protect the public against the creation or perpetuation of monopolies and practices detrimental to the public welfare, to prevent the practice of requiring the buying, leasing, or renting of special features, appliances, and equipment not desired or requested by the purchaser, lessee, or renter, to prevent false and misleading advertising, to prevent unfair practices by said licensees, to promote the public safety and prevent disruption of the system of distribution of motor vehicles and recreational products to the public and prevent deterioration of facilities for servicing motor vehicles and

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