Ford Motor Credit sues Reagor-Dykes; R-D files for chapter 11 bankruptcy
Ford Motor Credit has filed suit against Lubbock-based Reagor-Dykes Auto Group, some of its subsidiaries, Bart Reagor and Rick Dykes, claiming the company is "in default, having breached their agreements with Ford Credit by, among other breaches, selling vehicles "out of trust," failing to make required payments to Ford Credit as and when due, and submitting false or inaccurate information to Ford Credit in order to delay paying amounts to Ford Credit and/or to obtain financing from Ford Credit under false pretenses", according to a lawsuit filed Tuesday.
As of July 31, the suit claims Reagor-Dykes owes an estimated $116,168,000.00 and the amounts currently due are believed to exceed $40 million.
According to the suit, a June 2018 audit showed "substantial variances existed between the dealership's reported sales dates and the other records that Ford Credit reviewed, with an average violation discrepancy of fifty-five (55) days (across all of the dealerships)." Documents state Ford Credit's initial analysis "of sales found out of 150 reported sales, 147 of the vehicles did not match the sales and/or registration dates reported by the Texas DMV and/or other publicly-available sources." Ford Credit claims Reagor-Dykes would "double-floor" vehicles, acquiring vehicle inventory financing for one vehicle at two locations, obtaining double financing from Ford Credit.
According to inforuptcy.com, Reagor-Dykes Auto Company, LP filed for Chapter 11 bankruptcy in the Texas Northern Bankruptcy Court Wednesday.
Bart Reagor, with several years experience in auto sales, founded the Reagor Auto Mall on 19th Street in downtown Lubbock in 2003. The company known for "any car you want", became Reagor-Dykes when Rick Dykes partnered with Reagor in 2006, according to the company website. Reagor is a former Texas Tech football player. Dykes is a former college football coach, including time at Texas Tech. Rick Dykes is the son of former Texas Tech football coach Spike Dykes and brother of SMU football coach Sonny Dykes.
Ford recognized Reagor-Dykes just months ago with the President's Award to both Spike Dykes Ford in Lamesa and Reagor Dykes Ford of Plainview. According to a release from Reagor-Dykes at the time,
"Spike Dykes Ford has continued to grow market share and has been recognized by Ford Motor Company as the nation’s top sales efficiency Ford dealership in the U.S. in 2015 and 2016. The Reagor Dykes Auto Group added Reagor Dykes Ford in September of 2010, and 2017 marks the first year the dealership has earned the President's Award. The pair of Reagor Dykes Auto Group Ford locations are two of four Ford dealerships from the Texas Panhandle to the El Paso to earn the honor."
Here is a statement from the company issued Wednesday afternoon:
The Reagor Dykes Auto Group regrets that it became necessary this morning to seek legal protection for several of its dealerships due to a dispute with one of its lenders. We are doing everything in our power to work through the issues. We are eternally grateful for our loyal employees, customers and friends in Lubbock and the West Texas community.
Rick Dykes and Bart Reagor
Marc McDougal response
Here is a statement from McDougal issued Thursday morning:
Downtown will be fine.
Reagor/Dyke has been a big part of Downtown redevelopment, and an outstanding corporate citizen.
Downtown will continue to grow and thrive. In the meantime, we share concern for all those affected by these events including the many employees of the Reagor/Dykes Auto Group.