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The automaker, Rivian, is suing Ohio state’s Registrar of Motor Vehicles. The lawsuit is due to the state having laws in place that prevent the company from selling their vehicles in Ohio. A 2014 law gives the Registrar the ability to deny manufacturers, parent companies, subsidiaries, and other affiliated entities of a manufacturer of a license to be a motor vehicle dealer. From this law, organizations such as the Ohio Automobile Dealerships Association, or OADA for short, rallied to limit competition in the market through the enactment of this law. They lobbied the Ohio General Assembly to further create a strict law that would not allow the direct-sales-only business model for any auto manufacturer. There actually is one exception to this rule. Tesla would remain allowed to sell this way. This is where Rivian stepped in to sue the state.

Tesla and Rivian follow the same sales style.

Since Tesla is allowed to sell in Ohio but Rivian has been driven out, they have stated that they feel purposely left out. The Chief Administrative Officer, Mike Callahan, gave a statement on his beliefs surrounding the situation. He expressed that he believes Ohio’s rules and enforcement of said rules is unjust and creates a disadvantage for any non-Tesla company. Callahan went on to say that “Consumer choice is a bedrock principle of America’s economy.” He called Ohio’s set of rules an “archaic prohibition” that targets direct-sale of vehicle based companies.

Callahan described Ohio’s nature as unconstitutional and irrational.

The Ohio Bureau of Motor Vehicles, the organization in which the Registrar falls under, released a comment saying the Registrar will make no official comment on the lawsuit.

Both Tesla and Rivian follow the same sales method.

Neither manufacturer uses franchise dealerships. They focus entirely on company owned dealerships instead. Around 2014 when Ohio passed its original law, Tesla already owned and operated two dealerships in the state. Now, they operate three in total.

The lawsuit shows that companies, like Rivian, are allowed to do practically everything related to their vehicles, aside from actually selling them. This means they can service vehicles in the state, rent vehicles, and deliver vehicles that were purchased out of state. However, they still do not have the ability to sell Rivian models in state.

Rivian’s spokesperson team has confirmed that they do not expect to merely have the ability to sell handed to them. Several leaders at the company have confirmed that they intend to still go through the proper channels of obtaining the required licensing.

As the lawsuit was just filed days ago, no trial date has been set yet.