Blog: GPB Capital Holdings Update: New York Appeals Court Grants Patrick Dibre's Motion for Summary Judgment Against GPB Capital - 2020-08-13
Scientologist David Gentile, owner of GPB Capital Holdings, was dealt a legal loss yesterday when the Supreme Court of the State of New York Appellate Division granted Patrick Dibre his motion for summary judgment in GPB Capital Holdings v. Dibre. The case at hand concerned the sale of car dealerships owned by Dibre to GPB Capital Holdings. Certain of these dealership sales were never completed, this although GPB Capital paid Dibre ~$42 million.
A key contractual factor in selling a car dealership is that the automotive manufacturer must approve the sale. For example, if Party A wants to sell her three Nissan dealerships to Party B, then Nissan must approve the sale as its name, cars, repair services, and OEM replacement parts are involved. If Nissan performed due diligence on Party B and found it to be incapable of successfully running dealerships or to have other issues that could create legal liabilities for Nissan, then it would exercise its rights and decline to approve the sale.
This is what happened in the GPB Capital Holdings v. Dibre lawsuit. While a few auto manufacturers granted their approval for Dibre to sell his dealerships to GPB Capital, a few other manufacturers did not. Holdings. In lieu of selling the excluded dealerships, then, GPB Capital paid Dibre money in exchange for taking a percentage of the dealership profits. A new agreement was entered into between the parties. This new "Master Agreement" irrevocably released Dibre from all terms in the original agreement.