Back in 2004 serial automotive entrepreneur Malcolm Bricklin announced plans to collaborate with "rogue" Chinese automaker Chery Motors to bring new cars to the US market. Chery is referred to as "rogue" because the company never actually got permission from the Chinese government to get into the car business. Needless to say, the deal eventually fell apart when Chery decided to hook up first with Israel Corp and Quantum LLC for a different joint venture which has also yet to come to fruition. Bricklin's company, Visionary Vehicles, which is now know as V Cars LLC, has now filed a lawsuit against Chery, Israel Corp, and Quantum LLC, et al. The suit is being filed under RICO statutes, typically used to go after mobsters, and V Cars is hoping to pursue Chery for the potential profits the company feels it could have made over the course of the deal. How much? $14 billion.
V Cars claims they provided Chery with business plans and ideas (along with $26 million in up front investments) which they then used for their own business after abandoning the deal. During a conference call today, Bricklin explained that he wants to show Chery and other Chinese companies that if they are going to do business with western companies they need to deal ethically and follow the rules. V Cars is also seeking injunctions to prevent Chery from selling any vehicles based on these plans in North America. The complete text of the suit that has been filed in Federal District Court in Detroit can be read here (Warning: PDF download).
[Source: V Cars]
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Reader Comments (Page 1 of 2)
Graham @ Jul 21st 2008 1:44PM
Who would have thought that something Malcolm Bricklin was involved in would be a miserable failure...
geo.stewart @ Jul 21st 2008 1:57PM
who thought dealing with the Chinese over IP would end with a royal drubbing?
Torrent @ Jul 21st 2008 1:56PM
What does this have to do with Chery or that guy?
It was funny though.
why not the LS2LS7? @ Jul 21st 2008 1:57PM
On top of this, I don't get how Chery is allowed to bring cars to GM's backyard when they unabashedly knock off the Chevrolet Spark as the Chery QQ.
GM should get some percentage of Chery's revenues in the US as compensation until they are made whole (and given the QQ sells well in China, that's gonna be a while).
Rocketboy @ Jul 22nd 2008 9:49AM
Because GM is working with Cherry... simple as that.
Throwback @ Jul 21st 2008 1:58PM
Another Bricklin venture that fell apart. I'm shocked!
Throwback @ Jul 21st 2008 1:58PM
Another Bricklin venture that fell apart. I'm shocked
Soccer Mom @ Jul 21st 2008 2:08PM
I certainly hope they win.
China, despite is WTO membership and other agreements, is acting as a used car salesman in every respect. This culture of take one-time profit and run, screwing partners and disregarding any agreements, laws and ethical rules, applies not just to small businesses, but all the way to the government.
I hope that this type of litigation will make them think twice.
John @ Jul 21st 2008 8:55PM
I'm waiting to see the lawsuit against bricklin for the $2 million he scammed out of each one of his dealers.
It's easy just to bash the Chinese when your own history is full of scandal. Ask the folks in Newfoundland who Bricklin scammed out of millions in the 1970's.
Paul @ Jul 21st 2008 2:20PM
This could be a very good thing in the long run for the Chinese automakers. The earlier they learn to play by western rules the sooner they will be producing a product that people in the western world may want to buy.
tankd0g @ Jul 21st 2008 2:28PM
Yeeeah....good luck with that.
Rocketboy @ Jul 21st 2008 2:29PM
"Needless to say..."
Then why did you?
Austin @ Jul 21st 2008 2:43PM
Hit them hard!!
robert bell @ Jul 21st 2008 2:46PM
anyone dealing with the Chinese needs to keep one hand on their wallet and one eye on their "partner."
chinese business "ethics" can be summed up in "whatever it takes at whatever cost." They do not share any sense of business ethics in the Western sense of that phrase; hence, their breach of contracts and piracy of intellectual property rights not only with no remorse but with an attitude that such behavior is acceptable if they achieve their objectives.
Anyone doing a JV with a Chinese firm has beter have a plan B and your lawyer on speed dial.
zedster @ Jul 21st 2008 3:00PM
will he make a sv-2 with the money if he wins?
icu812ru469 @ Jul 21st 2008 3:17PM
Boo hoo hoo... China isn't doing anything that every other scummy country, including the U.S., hasn't done in the past during their economical infantcy. Mr. Brickhead is just pissed that he got screwed by the Chinese before he screwed them... nothing new.
I_Hate_China @ Jul 21st 2008 3:27PM
So Chery is effectively blocked from selling anything in the US if Malcolm prevails.
Corey W. @ Jul 21st 2008 3:47PM
Maybe I'm in the wrong business?!?! How do you get 26M in upfront cost, squash the deal, then keep the money... WTF!! ;-)
Gardiner Westbound @ Jul 21st 2008 4:12PM
Malcolm has figured out there may be more money in suing people than making cars.
iQuack @ Jul 21st 2008 4:43PM
Malcom Bricklin is a reincarnated Preston Tucker.