Judge rules against Tammy Darvish in succession case

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A Maryland judge on Tuesday summarily dismissed the lawsuit Tamara Darvish filed in 2015 against her father and the company he founded, DARCARS Automotive Group, after she was ousted from the dealership group.

Tamara Darvish, a well-known face of the company and industry during the fight to reinstate dealers who lost their franchises during the bankruptcies of General Motors and Chrysler Group, charged that her father had reneged on a promise to make her part of the dealership group’s ownership team.

Her halfbrothers now run the company.

Judge Robert Greenberg ruled Darvish’s case lacked evidence to support her claims.

“The court is mindful of the fact that Plaintiff faithfully served DARCARS for several decades, and believed her sacrifice would result in an inheritance of her father’s business, or at least one-third thereof,” Greenberg wrote in his ruling. “It is not unsympathetic to her plight, and the present estrangement from her father and [half]brothers. It cannot, however, create a cause of action where none exists.”

Case closed

Greenberg, of the circuit court for Montgomery County, Md., issued the ruling after a May 6 hearing where he took various evidence and testimony under advisement.

John Darvish Sr., 79, and his sons — John Jr., 43, and Jamie, 40 — had expected the case to go to trial in July, a spokeswoman for DARCARS had said previously. With Tuesday’s ruling, the case is over, DARCARS said in an email to Automotive News.

“Today Judge Robert Greenberg issued a ruling stating there was no legal basis for Tamara Darvish’s claims against DARCARS,” the company email said. “We are pleased to have this behind us.”

Tamara Darvish, 52, did not immediately return a phone call seeking comment.

DARCARS, of Silver Spring, Md., ranks No. 28 on Automotive News’ list of the top 125 dealership groups based in the U.S., with retail sales of 24,411 new vehicles in 2015.

Darvish v. Darvish

Darvish started at DARCARS in 1984. She held a variety of management positions over her 30-year tenure at the company.

The lawsuit stated that her father, John Sr., repeatedly promised her during her employment that if she continued at DARCARS, he would provide equal one-third ownership stakes in the company when he retired to her and her two half-brothers from his second marriage.

John Sr. also said that daily operational decisions would require unanimous consent “so that John Jr. and Jamie would not be able to shut her out,” her lawsuit contended.

“Tammy relied upon her father’s promises, devoted herself to DARCARS,” her lawsuit stated.

But after John Sr. made a written succession plan in January 2014 outlining his plan for equal ownership, the court documents said John Jr. and Jamie became “hostile” towards Tammy. The two brothers “demanded” she sign a “side agreement” that would have given the brothers effective control over the company, the lawsuit said. She refused.

Tamara said, according to court documents, that around March 2014, John Jr. and Jamie began pressuring their father to break his prior promises to Tammy and remove her as executive vice president and take away her operational control.

Abrasive style

On March 10, 2014, John Sr. named John Jr. as CEO and Jamie as COO of the company.

“Shortly thereafter, Tammy was asked to clean out her desk and was stripped of her authority and responsibilities as executive vice president,” the lawsuit alleged. “Tammy was also informed that she would not be receiving her promised ownership interest in DARCARS.”

In Tuesday’s ruling, the judge wrote: “Although it is true that Darvish Defendants gave John Sr. an ultimatum to either pick them or Plaintiff to take over the company, this conduct is not unlawful or improper.”

Judge Greenberg also wrote that two senior employees at DARCARS testified to resigning because of Tamara Darvish’s “abrasive management style.” Likewise, John Sr. testified at deposition that “the biggest daily weakness that [Plaintiff] had” was the way she “treated people.”

General denial

“The court has sworn testimony from two individuals regarding the alleged abrasiveness of Plaintiff’s management style, which was conveyed to John Sr., who apparently was already aware of this problem from his own observations,” Greenberg wrote.

The judge wrote that Tamara Darvish did not produce any testimony or evidence to refute the assertions.

“Accordingly, Plaintiff’s argument falls into the category of a general denial,” the judge wrote. “Such a conclusory statement, which does not show facts in detail and with precision, is insufficient to create a genuine dispute of material fact.”

The judges also agreed with the arguments put forward by the Darvish brothers that the alleged oral promises were “too vague to be enforceable.”

Automakers’ concern

Also, according to court documents, in March 2010, “because of growing concern from automobile manufacturers” that John, Sr. had no apparent plan for the continuance of the business after his demise, a succession planner named Roy Dixon was hired.

Dixon was unable, though, to devise a succession plan agreeable to all interested parties. Between 2012 and early 2014, various drafts of stock purchase agreements, shareholders’ agreements, promissory notes and pledges were circulated among all the parties, but no agreement was reached.

Ultimately, the three children left it to their father to choose his successor.

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