Former Neb. car dealer execs sue bank, Toyota Financial over criminal probe into missing cars

Nebraska vehicle dealer execs sue bank, Toyota arm

OMAHA, Neb. — Three former executives of a Scottsbluff car dealership have filed a federal lawsuit against their bank and Toyota’s financial arms over accusations that they stole dozens of vehicles off their own lot.

Allen Patch, Rachel Fait and Rick Covello, who all now live in Utah, were investigated after more than 80 vehicles disappeared from Legacy Auto Group in March 2009 and later turned up in Utah, Wyoming, Las Vegas and Scottsbluff. They faced dozens of charges of theft and title fraud, which were later dropped.

The auto executives contend that Platte Valley Bank, Toyota Motor Credit Corporation and Toyota Financial Services gave false information to authorities that indicated they — not the dealership — owned the vehicles, according to the lawsuit filed in late July in U.S. District Court.

“They went on this big old manhunt looking for these vehicles when the local Platte Valley Bank knew where they were, when Toyota knew where they were,” says Audrey Elliott, the auto executives’ attorney.

Platte Valley Bank attorney Howard Olsen on Tuesday asked for the case to be dismissed. His motion says the lawsuit fails to show intentional wrongdoing by the bank.

“It is reasonable to conclude the absence of all the vehicles were part of criminal activity,” the filing says.

Olsen declined to comment on the case.

Messages left for a Toyota attorney weren’t immediately returned.

Legacy was dealing with financial problems when 81 new cars and trucks, valued at $2.5 million, went missing in March 2009. Prosecutors said at the time that Patch and his associates were suspected of trying to sell the vehicles to auction houses and keep the proceeds, rather than pay Toyota.

In the lawsuit, the auto executives say Platte Valley Bank and Toyota had security interest in the vehicles but did not have ownership rights. The bank also failed to make Legacy’s payments to Toyota and pressured Patch into selling the dealership to a buyer of the bank’s choosing, the lawsuit says.

Faced with an impending sale, Patch decided to sell his inventory to pay Toyota and the dealership’s other creditors, the lawsuit says. But the bank and Toyota reported that the vehicles were stolen.

“Legacy Auto owned those vehicles. There was no fraud or criminal behavior,” Elliott says. “There was malicious prosecution because of false information given by Platte Valley Bank officials and Toyota officials.”

The auto executives are seeking unspecified monetary compensation.

Their lawsuit had also named Scottsbluff County attorney Tiffany Wasserburg and her deputy as plaintiffs in the case, but the judge on Wednesday dismissed those parties.

In November, Wasserburg’s office dropped its charges in the case in light of a pending federal investigation. But in January, the federal prosecutor handed it back over. Doug Warner in the county attorney’s office said Thursday that the case file was on his desk when he started in the job last month, but he’s still reviewing the information.

The Legacy Auto dealership has been sold to Wyoming-based Fremont Motors.

Online:

U.S. District Court, Nebraska: www.ned.uscourts.gov/