Credit union files suit against Wallingford car dealership

Credit union files suit against Wallingford car dealership


A New Haven-based credit union is seeking damages from a Barberino dealership in Wallingford, claiming the business violated a settlement agreement reached in June 2015.

Connex Credit Union Inc. states in the lawsuit that the Barberino dealership at 505 N. Colony Road violated an agreement that allowed the dealership to provide financing through Connex to their customers. The dealership agreed to pay Connex $780,000 to settle the claim in June 2015, but the credit union claims in the lawsuit that the dealership then violated a settlement agreement by continuing to tell customers to “return their keys and cars to Connex during the term of their loan.”

Defendants listed in the lawsuit, filed in November in New Haven, include Barberino Brothers, Inc., Barberino Car Country, Thomas Barberino, Sr., and John Mocaldo.

They are represented by John Conway, of Wallingford-based Loughlin Fitzgerald. Conway couldn’t be reached for comment, but denied the allegations in a brief filed in response to the lawsuit.

Mocaldo said Friday he was not aware of the lawsuit and also denied the allegations.

Connex is represented by Lucas Rocklin and Simon Allentuch of New Haven, who could not be reached for comment.

According to the lawsuit, prior to June 2015 the dealership “regularly encouraged their customers who were Connex borrowers to breach their retail installment contracts with Connex by turning the collateral (the borrower’s vehicle) over to Connex during the term of the loan.”

“Defendents repeatedly told customers to just deliver the keys to Connex and Barberino Country or Barberino Brothers would get them a new car either through a new sale or a lease,” the lawsuit states. “The loan collateral (the vehicle) was worth less than the outstanding balance of the loan, resulting in a substantial loss to Connex.”

The credit union claims it discovered the alleged violations of its dealers agreement with Barberino in 2013 and 2014.

In June 2015, Barberino entered into a settlement agreement with Connex and agreed to pay the credit union $780,000 to settle the claims. Connex ended the dealer agreement “with certain caveats” still in place, the lawsuit alleges. In the settlement agreement, Barberino agreed that employees, agents and representatives of the dealership “shall not directly or indirectly advise, recommend or suggest to any person or entity that they may want to or should turn-in to Connex their automobile that is financed through Connex,” according to the lawsuit.

The lawsuit claims Barberino violated the provision and dealership representatives “did not stop telling customers to return their keys and cars to Connex during the term of their loan.”

Had the dealership not encouraged customers to turn in their cars and keys to Connex, the customers would not have been able to purchase another vehicle after they defaulted on their car loan, the lawsuit continues, adding that the practice resulted in substantial losses for the credit union, which seeks unspecified damages, including costs and attorney’s fees.

Barberino, which operates a Nissan dealership on Route 5 in Wallingford, recently closed its Mitsubishi dealership in Watertown and consolidated the inventory and operation to its Hartford dealership.

Hugo Louriero, general manager of the Wallingford dealership, confirmed the closure of the Watertown dealership and said the Mitsubishi brand was not popular enough to sustain two dealerships — the Hartford location is also a Mitsubishi dealership.

The Watertown dealership closed several weeks ago and the Wallingford and Hartford locations will remain open, Louriero said.

The dealership has been on Route 5 in Wallingford since it opened in 1936 as a gas station selling Nash automobiles and later Pontiacs. It opened Barberino Mitsubishi Hartford on Park Avenue last September.

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