Carson City Harley-Davidson dealership sued for $4 million

The owners of Carson City Harley-Davidson dealership are being sued for more than $4 million by Harley-Davidson Credit Corp, according to court documents.

The suit filed on Nov. 17 in Carson District Court charges Roberta and Jose Richard Tapia sold hundreds of thousands of dollars worth of motorcycles and accessories without paying back the loans used to buy the bikes.

Under a trust agreement with the Harley-Davidson Credit Corp. (HDCC), the Carson dealership received loans to buy vehicles, accessories and other salable products. Those loans are then paid back with part of the money paid when the bike or accessory is purchased by a customer.

The Tapias purchased the bikes and other products using loans from Harley-Davidson Credit Corp. through their corporate name Gato Malo. But the lawsuit charges when bikes and other things were sold, they kept the money instead of paying off the loans.

“Gato Malo is indebted to HDCC in the sum of $4,030,029.88,” the court documents state.

According to the complaint, that includes $726,677 in cash that should have been paid on loans.

A declaration by Mark LaMendola, operations manager for HDCC, states “Gato Malo has already caused over $200,000 of inventory to be sold out of trust since October 8, 2015.”

District Judge James Wilson signed a temporary restraining order on Friday, Nov. 13, to stop any further sales transactions unless all the proceeds go to HDCC. And he did that without notice to the Tapias after being told “Any meaningful notice of this motion to Defendants will give the Defendants an opportunity to continue to dispose of HDCC’s secured collateral without remitting payment.”

In addition, the suit says auditors were unable to verify the status of motorcycles worth another $637,282.

It charges the Tapias started keeping the cash instead of paying back the loans as early as February 2009.

A hearing will be held on Dec. 2 in front of Wilson.

Calls to Tapia and the dealership on Research Way near College Parkway and the freeway bypass have not been returned since last week. Multiple phone calls on Tuesday to the dealership end with a busy signal.

The dealership originally shut down a couple of weeks ago citing, according to its Facebook page, slow business on Nov. 13. It was supposed to open up again last Tuesday. When visited by the Appeal last week and this week, there was a cryptic sign on the door stating: “Due to a systemwide outage, we are currently closed. We will be extending the contest another week.”