Gregory Coccaro Jr., owner of North State Custom in Bedford Hills, N.Y., has filed a lawsuit against Mercedes-Benz USA and Celebrity Auto of Westchester, alleging that the dealership demanded kickbacks and other concessions in exchange for renewing the shop’s Mercedes-Benz collision repair certification.
In the 73-page complaint, North State owners Coccaro Jr. and Frank Masella allege that following a routine re-certification audit by Mercedes-Benz – in which North State received a favorable review – Celebrity Auto told the shop that unless North State allowed Celebrity to hold itself out as the repairer of its customers’ vehicles, agreed to allow Celebrity to set the manner and price of repairs and paid a set percentage of its labor costs to Celebrity as a “kickback,” Celebrity would withhold its sponsorship of North State in the Mercedes-Benz USA Certified Collision Program.
According to the lawsuit, the dealership’s demands constitute serious violations of New York State’s repair regulations, which require that only a licensed collision repair facility may negotiate a repair price with an insurance company and only a licensed collision repair facility may sign the state-mandated certification of repair, which validates the repair for the consumer.
North State and its legal counsel believe that Celebrity’s actions constitute interference with contract and violations of the business laws of the state of New York, and are seeking damages in the millions of dollars, according to the body shop.
“The lawsuit is a case of first impression in New York and will likely have ramifications throughout the industry as it moves forward,” North State Custom said in a news release.