- Associated Press - Thursday, March 10, 2016

FAIRFAX, Va. (AP) - The Virginia Automobile Dealers Association is suing Tesla Motors to block the electric car maker from establishing a second dealership in the state.

The lawsuit filed Wednesday in Fairfax County accuses Tesla of violating an agreement it reached with the auto dealers over Tesla’s first Virginia dealership, which opened last year in Tysons Corner.

The dealers have argued that Tesla’s business model violates state rules requiring automakers to sell cars through independent dealerships.

The Department of Motor Vehicles initially rejected Tesla’s application, but reversed course after the auto dealers and Tesla reached a settlement.

The dealers say that settlement restricts Tesla to a single Virginia dealership.

Tesla, which has applied for a second store in Richmond, says its agreement on the Tysons store doesn’t preclude establishment of a second dealership.

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