No Christmas Wishes Granted Here: Nissan Hit With Lawsuit, Executive Departure

As a terrible year draws to a close, Nissan can’t seem to put its bad luck behind it. In a case of “the hits keep on coming”, the automaker’s vice chief operating officer, Jun Seki, announced his departure from the company less than a month after taking on the position.

Seki, once a candidate for the CEO chair, was tasked with helping turn around the struggling company in the wake of the Carlos Ghosn scandal and concurrent sales plunge. At the same time, an American dealer group is suing Nissan over alleged Ghosn-era financial misdealings.

A merry Christmas it was not.

Seki told Reuters that his three-decade career at Nissan will come to an end in the new year after receiving an offer to head Nidec Corp, a Japanese components manufacturer.

“I love Nissan and I feel bad about leaving the turnaround work unfinished, but I am 58 years old, and this is an offer I could not refuse. It’s probably my last chance to lead a company too,” Seki said, adding, “It’s not about money. In fact, I will take a financial hit since Nissan pays us well.”

Reuters noted that the company’s turnaround team, consisting of Seki, Chief Operating Officer Ashwani Gupta, and CEO Makoto Uchida, have failed to “gel” as a team following their appointments. Seki will likely leave the company in the coming month.

In California, Nissan finds itself on the receiving end of a lawsuit from the receiver for the Sage Group of Nissan-Infiniti dealerships. The suit names Nissan, Nissan Motor Acceptance Corp, and Trophy Automotive Dealer Group LLC — the latter being an outfit owned by Nassar Watar, a partner of a Saudi national linked to Ghosn via the former chairman’s breach of trust indictment.

In the lawsuit, Byron Moldo (court-appointed receiver for Sage Group), claims “a culture of corporate corruption and greed” forced the group into the “fire sale” of two California dealerships to Ghosn “cronies.” Those individuals are listed as Watar and Khaled al-Juffali.

From Automotive News:

Watar and Juffali are joint owners of Al-Dahana which, in turn, owns 50 percent of Nissan Gulf, the regional distributor for Nissan and Infiniti in several Middle Eastern countries.

Japanese prosecutors allege that Ghosn arranged payment of $14.7 million from a Nissan subsidiary to a company owned by Juffali to help Ghosn settle millions of dollars of personal losses on currency swap contracts concerning his executive compensation.

Ghosn and Juffali have denied any misconduct or kickback scheme.

The plaintiffs’ lawsuit alleges that “Nissan had a corrupt relationship” with al-Juffali and Watar, saying they became Nissan insiders when al-Juffali bailed out Ghosn.

“They were rewarded by Ghosn with illicit payments from Nissan’s CEO reserve fund,” the filing says. “In addition, Nissan entered into a joint venture with their company, Al-Dahana, to distribute Nissan products in Kuwait, Bahrain, Saudi Arabia, and Abu-Dhabi.”

The suit alleges that, in 2017, Nissan’s finance arm stopped backing Sage Group’s vehicle purchases, drying up inventory at the group’s dealerships. Nissan North America then allegedly paraded Trophy Automotive as a potential buyer of Sage’s Universal City and West Covina Nissan dealerships, without disclosing the link between the automaker and the Watar-owned group. The sale eventually went through for a sum far more meager than Sage had anticipated.

The suit also claims Nissan withheld $3 million from Sage, forcing it to sell two other dealerships to another supposed insider, Dennis Lin, for zero dollars in franchise value.

The man who looms large over the lawsuit — and, to this day, the automaker — remains in Japan awaiting trial. Ghosn stands charged with two counts each of misreporting income and breach of trust.

[Image: rmcarvalhobsb/Shutterstock]