A Medford, N.Y., company that bills itself as Long Island’s top RV dealership is being sued for more than $10 million by two national finance companies that claim the retailer sold vehicles but failed to pass along more than $3 million in payments to the lenders.
Newsday reported that Eddy’s Long Island RV Center, which sells and rents RVs and has been in business since 1960, has seen virtually all of its inventory seized and its bank accounts frozen.
Executing a court order from federal Judge Joseph Bianco, the Suffolk County sheriff’s office seized about 140 motorhomes and trailers starting on Monday (July 21) morning, said Capt. Ted Sarian, the commanding officer of the sheriff’s civil bureau. The seizure was completed Tuesday.
The battle began in court on May 30, when GE Commercial Distribution Finance Corp., a unit of Fairfield, Conn.-based General Electric Co., sued Eddy’s in U.S. District Court. GE said the company defaulted on its payment agreement when it sold about $2.3 million worth of vehicles without sending payments to the lender. GE is demanding that Eddy’s pay its entire $6.6 million loan balance.
Textron Financial Corp., a Rhode Island company, filed suit on June 9, claiming Eddy’s owes it more than $4 million after it defaulted on its loan terms by selling $1.5 million of vehicles and not paying for them.
Thomas J. Gouldsbury, 50, an owner of Eddy’s for the last nine years, said his company is open for business and “there will be no bankruptcy filing at all … We are in the process of reorganization.”
Gouldsbury said his company’s financial troubles stem from a declining economy and in order to right itself, some of the establishment’s 50 employees may have to be fired and a portion of its 13-acre lot will be sold.
“It was not necessary that the sheriff was here due to the fact that we gave a voluntary surrender,” said Gouldsbury. “It was a total waste of resources for the Suffolk County Sheriff’s Department.”
RV dealers normally finance their inventory by paying lending institutions a monthly inventory cost and reimbursing the lender each time a vehicle sells at retail, said Bill Baker, senior director of communications and publications for the Recreational Vehicle Industry Association (RVIA).
Newsday reported that GE Commercial also claims that when it inspected Eddy’s lot to confirm the sales the dealership concealed them by allowing purchasers to store their vehicles on-site.
GE did not return telephone calls seeking comment, and Textron declined to comment. The lawyer for Eddy’s and owners Thomas and Deborah Gouldsbury declined to comment on the lawsuit, but agreed with the owner that the business has suffered because of the economy.
“The combination of very high fuel prices and a shrinking economy have impacted significantly on the RV market,” said Eddy’s attorney, John Gentile of Bellavia Gentile & Associates in Mineola.
Gentile said the freezing of Eddy’s bank accounts has “resulted in the complete destruction of the business.”
But he was hopeful he could work out a deal with the plaintiffs: “It is our hope that we are going to be able to work out a resolution that will allow the business to continue to serve the Long Island community.”
Yesterday (July 23), Eddy’s, noted for its massive RV lot, was virtually empty, except for two dozen vehicles mostly in its rental lot. The seized vehicles were taken to three privately owned locations in the towns of Islip, Brookhaven and Smithtown, according to the sheriff’s department.