Opinion ID: 659918
Heading Depth: 1
Heading Rank: 2

Heading: Claims Under Secs. 6 and 16

Text: 5 In our earlier opinion, we observed that Cessna did not register or attempt to comply with the 1974 Act. 915 F.2d at 1045. That act provides that: 6 A person who offers or sells a franchise in violation of sections 5(1), 6, or 16 is liable to the person purchasing the franchise for damages or recision, with interest at 6% per year from the date of purchase and reasonable attorney fees and court costs. 7 Mich.Comp.Laws Sec. 445.1531, Mich.Stat.Ann. Sec. 19.854(31). We considered the violations only insofar as they affected retroactive application of the 1984 statute. Under Michigan law, a statute applies retroactively when doing so does not violate a vested right. We found that, because of the registration violations, Cessna's contractual rights had not vested. 915 F.2d at 1044-45. 8 The district court correctly noted that when we partially reversed its grant of summary judgment we did not ask it to revisit the Sec. 6 and Sec. 16 claims. J.A. at 141-43. We agree with the district court's analysis of this issue. Although failure to register and issue a prospectus in violation of Secs. 6 and 16 may give rise to claims for damages, damages would not be appropriate in this case. That Cessna violated these provisions has been established. 915 F.2d at 1044-45. However, after a six-year business relationship, GA surely possessed all the information it would have received if Cessna initially had issued a prospectus. If Cessna had registered and Michigan had denied the franchise, GA would not have enjoyed several years as one of the leading sellers of Cessna's airplanes. GA does not seek to rescind a contract illegally formed in 1977. Rather, it seeks damages for the profits it would have received had a healthy franchise contract continued after 1984. The injuries caused by non-renewal simply did not flow from these statutory violations.