Carrie Rengers

Three decades after not winning Wichita’s Lexus dealership, Mike Steven sues Toyota

Three decades after not winning Wichita’s Lexus dealership, Mike Steven is suing the Lexus division of Toyota Motor Sales USA for more than $120 million in damages.
Three decades after not winning Wichita’s Lexus dealership, Mike Steven is suing the Lexus division of Toyota Motor Sales USA for more than $120 million in damages.

UPDATED — Almost three decades after not being selected as Wichita’s Lexus franchisee, Mike Steven is suing the Lexus division of Toyota Motor Sales USA.

Steven and his longtime CFO, Harold Johnson, filed the suit this month in U.S. District Court.

Neither will comment on the case.

Through an e-mailed statement, a Toyota spokeswoman said, “We believe these claims related to events that allegedly occurred nearly 30 years ago are completely meritless and have no basis in the law.”

From 1970 to 2016, Steven — now a resident of Las Vegas, according to the lawsuit — was a Toyota dealer in Wichita.

The lawsuit states that when Toyota announced its new Lexus division at a dealer meeting in 1989, dealers were told they’d be the top choices to sell the new luxury line.

According to the lawsuit, a Lexus representative congratulated Steven as “the favorite to be appointed,” and Steven began making arrangements for the dealership, which included acquiring property for it.

During a visit with the Lexus representative, the suit says, Steven was advised there were two other applicants — Wittmann-Gorges Auto Group and Scholfield Auto Group — but that accepting those applications was a formality only.

The suit says the Lexus representative toured Steven’s new site and reviewed plans before toasting the new dealership over lunch.

Then Steven received “the devastating news” that Gorges and Wittmann Lexus would receive the dealership.

The suit says managing partner Marc Gorges called Steven to say “he didn’t know how or why they got the Lexus franchise but that he was shocked and that . . . Steven must be furious.”

Gorges says he is not familiar with the suit and doesn’t want to comment. He did say he was out of the dealership almost immediately, and it was sold to the Scholfield group.

The suit says Steven offered Gorges and his partners $1 million to not take the franchise.

It also says Steven contacted Lexus vice president and general manager J. David Illingsworth since no one else outside of the Toyota network had been awarded a Lexus franchise at that time.

The suit says Illingsworth blamed the performance of Steven’s Toyota dealership and “tacitly threatened the Toyota franchise if Steven made waves on the Defendant’s selection of someone other than Steven.”

The suit says Steven’s dealership had been a sales leader and received “regular accolades from Toyota.”

However, the suit says, Steven and Johnson decided to defer litigation over the issue because they believed the Toyota franchise “would be in jeopardy” if they did anything.

They have filed the lawsuit under the Automobile Dealers Day in Court Act and say the statute of limitations has been extended “due to the coercion, intimidation and threats” by Lexus.

The lawsuit also says that Brian Barents was the national sales manager for Cessna Aircraft and then opened a jet aircraft division for Toyota USA and on behalf of Toyota had awarded the Lexus dealership “to his friends at Gorges-Wittmann in exchange for a partnership interest in the dealership called Gorges and Wittmann Lexus.”

Barents didn’t return calls for comment.

The lawsuit says that at Toyota, “it was considered a conflict of interest, illegal and a gross violation of Toyota/Lexus standards for a representative of Toyota or Lexus to take an interest ‘under the table’ in a franchisee company in exchange for favorable treatment to the applicant.”

The suit says not winning the Lexus franchise impacted Steven’s Toyota sales because it “made it appear that the Toyota franchisee was not a first rate dealer.”

The suit says conservative estimates show the Lexus dealership’s earnings from 1990 to 2019 would have been $108 million. Additional estimates put the Lexus franchise value at $20 million today, according to the suit.

Steven and Johnson say they’ve been damaged by more than $120 million and request that amount plus interest and attorney’s fees.

Today, Walser Automotive Group is the Wichita Lexus franchisee and has no connection to the case.

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