The Linn County District Court has awarded Stellantis Financial Services nearly $5.5 million in its lawsuit against Sky Auto Mall, an Iowa dealership group accused of obtaining multiple loans secured by the same vehicles. The court entered the judgment on August 24 without a trial because the defendant failed to respond to the lawsuit.
Stellantis wins nearly $5.5 million judgment against Iowa dealership group
The judge awarded the finance company $4,819,550.42 in unpaid principal and $750,265.83 in interest and fees. A credit of $69,869.80 reduced the final amount to just under $5.5 million, significantly less than the more than $12 million Stellantis initially sought.
The dispute centers on floorplan financing, a system that allows dealerships to borrow money to purchase vehicles for inventory and repay the loan after each sale. Stellantis alleges that Sky Auto Mall used some of the same vehicles as collateral with other lenders, effectively obtaining overlapping loans. Court filings also reference separate accounting records that allegedly helped conceal the existence of multiple debts.
Stellantis filed the lawsuit in early March against Sky Auto Mall and owners Alex, Igor and Yelena Tovstanovsky. A few weeks later, the court allowed Stellantis to recover some of the vehicles located at the group’s Newhall and Center Point dealerships. Ford Credit also filed a related action over inventory management, expanding a financial crisis that has involved several creditors.
The two dealerships laid off a combined 76 employees on March 6, including 30 workers in Newhall and 46 in Center Point. The three owners later sought Chapter 11 bankruptcy protection in the US Bankruptcy Court for the Northern District of Illinois. Their filings, submitted on March 20, list individual liabilities ranging from $1 million to $10 million. Those bankruptcy cases remain open.
The judgment establishes how much Sky Auto Mall owes Stellantis Financial Services, but it does not guarantee full or immediate payment. Available assets will need to be evaluated alongside claims from other lenders through the ongoing bankruptcy proceedings, which will ultimately determine how much of the award Stellantis can recover.
