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Dealer sues Harley-Davidson over new company restrictions

Lawsuit claims policies on international sales, third-party websites weaken profits

A Harley-Davidson Inc. dealer filed a lawsuit against the company on Nov. 1, claiming the company’s new restrictions blocking international sales hurt business for the dealership, which is based in St. Paul, Minn.

The lawsuit states Harley-Davidson implemented new policies on Aug. 1, prohibiting U.S. dealers from selling to customers outside the U.S, as well as using third-party websites such as eBay and Amazon.com to sell motorcycle parts and accessories starting Jan. 1, 2012.

“These policies are highly controversial and may be arguable,” said dealership President Tom Giannetti in a statement. “We certainly do not feel it is fair when we’ve spent years building a customer service-oriented business to promote the brand worldwide.”

However, Harley-Davidson spokeswoman Maripat Blankenheim said, “We disagree with the dealer’s premise.”

The motorcycle maker is protective of its brand. Although sales declined in 2008 during the economic recession, they have improved, as the company reported a third-quarter net income more than doubled from the previous year.

St. Paul Harley-Davidson earned $8 million a year from 2008 through 2010, according to the dealer. Still, the lawsuit claims Harley-Davidson’s new restrictions will lead to a loss in revenue.

“These changes would deprive (St. Paul Harley-Davidson) of literally millions of dollars of annual revenues, thereby jeopardizing its ability to remain in business,” the dealer said.

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