The Iron Town Harley-Davidson dealership is at 1925 S.
Moorland Road, New Berlin.
BERLIN — Iron Town, the New Berlin Harley-Davidson
dealership and its partner motorcycle shop in
Janesville, are defendants in a federal lawsuit that
demands a total of $6.3 million in delinquent debts and
asks merchandise sales from the businesses be stopped to
prevent more losses to Harley-Davidson Credit Corp., a
A federal judge has stayed the motion to stop sales but
ordered that merchandise only be sold if the agency is
notified of sales and sent what is due to repay any
A hearing is pending possibly later this week on the
request by Harley-Davidson Credit Corp. to stop all
sales at both stores.
The lawsuit filed in the U.S. District Court of Western
Wisconsin by Harley’s credit division claimed the
dealerships were in breach of contract for selling
motorcycles and not reimbursing the credit agency.
Eric and Sara Pomeroy with mailing addresses in Florida
own the dealerships, the lawsuit said. Neither of the
Pomeroys could be reached for comment.
In addition, the lawsuit claims fraud was committed
because the agency was repeatedly told that payments had
been sent but actually were never made.
As proof of fraud allegations, the lawsuit claims the
agency was provided a receipt of a wire transfer that
never was made.
The credit agency claims Iron Town owes $3.7 million and
the Janesville shop owes $2.6 million.
Harley-Davidson extended credit to JHD Holding Inc. for
its Janesville dealership and to H2D for the New Berlin
business at 1925 Moorland Blvd. The location was
formerly Hal’s Harley-Davidson.
The credit enabled both dealerships to purchase goods
and services, which included motorcycles.
“The most significant risk in inventory financing is
that the dealer borrower will sell the collateral at
retail and then wrongfully retain the proceeds that
should have been remitted to the floorplan lender
without informing the lender of the sale,” according to
a court document. “The floorplan lender’s main
protection is therefore the trust and integrity of the
Sales alleged without reimbursing credit
Last fall, the credit agency found that the New Berlin
dealership had sold $87,000 in merchandise without
reimbursing the agency. Other Iron Town’s past due debts
amount to $115,500. The agency in a letter to Iron Town
demanded reimbursement for the loan, according to the
Also last fall, the credit agency discovered that the
Janesville shop had sold inventory in excess of $281,000
without reimbursing the agency. It owed an additional
$457,000 in past due debts.
Some payment notes were returned for nonsufficient
funds, according to the lawsuit.
In January, Eric Pomeroy on behalf of both dealerships
told the agency that wire transfers would be sent to
cover the nonsufficient funds. The wire transfers never
arrived, according to the lawsuit.
Pomeroy told the credit agency that the New Berlin
dealership owed $994,000 and the Janesville business
owed $536,000. He agreed to make weekly payments of
$80,000 and $50,000 on the debts but only one payment
was made, the lawsuit said.
Audits early and late last month of both dealerships
found that dozens of additional motorcycles were again
sold without reimbursing the lender, prompting the
lawsuit, according to court documents.