GM's Efforts to Revive Fiat Chrysler Lawsuit Denied--Update
August 14 2020 - 10:40AM
Dow Jones News
By Ben Foldy
A federal-court judge has denied a motion filed by General
Motors Co. to revive its civil-racketeering lawsuit against Fiat
Chrysler Automobiles NV, once again striking down a legal battle
between the two Detroit rivals.
GM earlier this month asked the court to reconsider its tossing
of a lawsuit filed last fall, alleging Fiat Chrysler bribed
officials at the United Auto Workers union to gain an advantage in
labor-contract negotiations.
GM at the time argued it had uncovered new evidence to support
claims that Fiat Chrysler was trying to weaken its larger
competitor through an alleged payoff scheme involving top UAW
officials.
Fiat Chrysler has called GM's lawsuit meritless and disputed the
allegations.
In a ruling Friday, Judge Paul Borman called GM's motion to
amend its earlier complaint "a prohibited attempt to have a second
bite at the apple."
Mr. Borman also ruled that the new allegations provided by GM,
claiming Fiat Chrysler had enlisted two top UAW officials to aid
the scheme and paid them off using offshore banking accounts, were
too speculative to warrant revisiting his previous decision to
dismiss the case.
A GM spokesman said the company is disappointed in the decision
and will appeal.
The ruling marks yet another setback for GM in its unusual legal
offensive against a key rival.
Last November, GM filed the racketeering lawsuit, alleging Fiat
Chrysler sought to gain a labor-cost advantage over its competitor
by paying off UAW officials and corrupting the bargaining
process.
The lawsuit was largely based on revelations surfaced in a
yearslong federal investigation into corruption at the UAW. The
investigation has so far resulted in 14 convictions, including of
top officials at the union and a former labor-relations executive
at Fiat Chrysler.
In the original complaint, GM claims it incurred an extra $1
billion in labor costs as a result of the alleged scheme, which it
says was orchestrated by Fiat Chrysler then-Chief Executive Sergio
Marchionne. Mr. Marchionne died in 2018.
Judge Borman in July dismissed the case, ruling GM failed to
show it was a primary victim of the alleged misconduct.
Write to Ben Foldy at Ben.Foldy@wsj.com
(END) Dow Jones Newswires
August 14, 2020 11:25 ET (15:25 GMT)
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