SCS/HCS/HB 214 - This act contains new provisions governing motorcycle franchises. The act is very similar to SB 433.

HEARINGS - An aggrieved party may file an application for a hearing before the Administrative Hearing Commission (AHC). The procedure for such hearings is specified, including time of notice and method of service upon parties. The order providing the hearing date shall stop the complained-of activity until the final decision is issued. The decision of the AHC may only be reviewed in appellate court. (Section 3)

Franchisors shall give written notice of proposed acts to terminate the franchise, prevent the franchisee from changing its capital structure, prevent transfer of a franchisee's interest, or to prevent succession of legal heirs to a franchise, with certain exceptions. The notice shall inform the franchisee of the right to a hearing. The burden of proof shall be on the franchisor in proceedings where the franchisor must give notice of proposed actions; in all other proceedings, the burden of proof shall be on the franchisee. (Section 3)

PROHIBITED PRACTICES (Section 4) - It shall be unlawful for a franchisor to commit the following practices: (1) capricious, bad faith conduct which causes damage to a franchisee or the public; (2) to coerce a motorcycle franchisee to accept deliveries which were not ordered; (3) failure to reasonably deliver sufficient motorcycles; (4) to coerce a franchisee to enter into an agreement by threatening to cancel the franchise; (5) to terminate or not renew the franchise, with exceptions; (6) to prevent a franchisee from changing its capital structure; (7) to prevent transfer of interest of a franchise; (8) to prevent the changing of executive management; (9) to impose unreasonable standards of performance; (10) to require a franchisee to release any person from liability; (11) to prohibit free association; (12) to provide any illegal term in the franchise; (13) to fail to pay reasonable compensation, as defined by this act, to a franchisee upon termination; (14) to prevent succession by any legal heir under certain conditions; (15) to coerce a franchisee to waive a right that a franchisee may have under this act; or (16) to initiate any of the above acts on the grounds that the franchisor has advised a franchisee of its intention to discontinue representation at the time of a franchisee change.

URBAN EQUITY - When establishing or relocating a dealership in St. Louis City, a dealer shall make reasonable efforts to improve the equitable distribution of dealerships and to serve minorities (Section 5). The Motor Vehicle Commission shall, in approving licenses, assure an adequate percentage of minority- owned motorcycle dealers in the St. Louis and Kansas City areas (Section 6).

FRANCHISOR DEFENSE - It will be a defense for a franchisor if it is shown that the franchisee substantially failed to comply with the franchise requirements; if a franchisee or it officers have been convicted of a felony involving business honesty or practices; if a franchisee abandoned its business, is insolvent, or there has been a levy under an attachment process; or if the franchisor acted in good faith as a seller or holder of a security interest (Section 7).

FALSE ADVERTISING - No franchisor or franchisee shall use any false or misleading advertising.

CIVIL ACTIONS - The remedies provided by this act are not exclusive and a motorcycle franchisee may also bring a civil action for damages or injunctive relief (Section 9).
JAMES KLAHR