Tammy Darvish’s lawsuit against her father, John Darvish, and the family’s company, Darcars, is proceeding after an unsuccessful attempt to negotiate a settlement between the parties.
Judge Ronald B. Rubin granted a protective order to both parties Thursday in Montgomery County Circuit Court, allowing them to keep certain information confidential as negotiations between the sides continue.
In her lawsuit, Tammy Darvish of Potomac claims her father and two half-brothers are attempting to cut her out of the company she helped build. In court documents filed April 28, Tammy Darvish requested that she be provided damages equal to one-third of the value of the automotive empire.
Darcars, which operates 22 dealerships, mostly in Maryland and Virginia, brought in more than $1 billion in revenue last year.
According to court documents, the legal spat began in March 2014, when Tammy Darvish alleges that John Darvish Sr., the 80-year-old Darcars founder, stripped her of her authority at the company and appointed his two sons from a different marriage, John Jr. and Jamie, as successors. Prior to the dispute, Tammy Darvish, 51, had for years served as the public face of the company and was executive vice president before she left.
The move followed a controversy over a previous succession plan that gave unanimous consent in decision-making to John Jr., Jamie and Tammy, which would have effectively made them partners controlling the company. However, Tammy Darvish claims her two half-brothers attempted to renegotiate the deal to give each person a vote and then make decisions by majority consent—a move she believes would have given her half-brothers effective control of the company.
Prior to Thursday’s scheduling conference, the parties attempted to negotiate a settlement, but were unable to do so, according to court documents.
John Darvish Sr. and Darcars filed a motion in March to dismiss Tammy Darvish’s lawsuit. The motion claimed that the only written succession plan agreement, presented in January 2014 to his three children, provided only 5 percent stakes in the company and all three did not sign it. The motion to dismiss also stated that any prior oral agreements between Tammy and her father are unenforceable.
Rubin declared that motion moot last month after Tammy Darvish filed an amended complaint.
That amended complaint claims John Jr. and Jamie Darvish made “various attempts to manipulate their ill, elderly father into reneging on his agreement with Tammy in an effort to gain ownership and control of [Darcars] for themselves.” The complaint states Tammy assumed a leadership position at the company after John Sr. suffered a heart attack and was diagnosed with Parkinson’s disease.
The new complaint also offers additional evidence about Tammy Darvish’s efforts to build the company. In it, she claims she became the “de facto general manager” of the company in the mid-1990s, that she was instrumental in guiding the company through a taxing lawsuit involving a former executive from 1997 to 2002 and that she regularly worked 80 to 90 hours each week.
In a statement filed April 28, lawyers for John Darvish Sr. claim that “all of” Tammy Darvish’s claims “hinge on her allegation that Mr. Darvish promised her that at some undefined point in the future, he would give [Tammy] a one-third interest in [Darcar] and the right to veto her family members’ decisions about how the business is run.”
The statement continues, “[Tammy] admits that this promise was never reduced to writing. In reality, the promise was never made.”
Lawyers for John Darvish Sr. expressed confidence in their statement that Tammy’s claims would be dismissed as part of pre-trial motions.
Tammy Darvish left the company last year amid the controversy over the succession plan after working there for nearly 30 years. She now works as an executive vice president at Pentagon Federal Credit Union.
