Electric Car Maker Corbin Motors Faces Lawsuit

June 25, 2003 by Jeff Shepard

Officials of electric-vehicle company Corbin Motors (San Benito, CA) and subsidiary Corbin Motors Daytona Beach, have become the target of a lawsuit filed by California's Department of Corporations that alleges illegal business practices. The lawsuit filed last month in California's superior court asks for officials of both companies to pay civil penalties.

Officials with both companies are accused of misrepresenting Corbin Motors' financial health to potential investors, selling stock and franchises without registering with the state of California, and misdirecting company assets to fund the lifestyles of Corbin Motors CEO Tom Corbin, his family and a small inner circle.

Corbin Motors, manufacturer of one-person electric vehicles called Sparrows, attracted media attention around the world for its unique design. However, the vehicles have had to be returned to the factory for repairs. Dealers have fumed as customers waited for their vehicles. Disgruntled former supporters who call the cars faulty and unsafe have brought lawsuits. Last year, the company said it owed about $1 million in unpaid bills, and recently filed for Chapter 7 bankruptcy in March 2003.