Photo: Jalopnik
Just when you thought the troubled times of the early and mid-2010s were over and the industry is ready to move into the next decade with renewed confidence, two of the biggest carmakers in the world have gone to war, lawyers blazing.
In a surprising and unexpected move, General Motors announced on November 20 it has filed a federal racketeering lawsuit against FCA and a number of its executive, accusing both the company and its leadership of illegally trying to gain advantages back in the day when financial problems were at their peak.
GM says FCA is corrupt to the bone, and tried to use its influence over the years “to undermine the integrity of the collective bargaining process and cause GM substantial damages.” More precisely, GM accuses FCA of paying millions of dollars in bribes to obtain "benefits, concessions, and advantages in the negotiation, implementation, and administration of labor agreements over time.”
This, says the carmaker, caused “unfair labor costs and operational advantages, causing harm to GM.”
GM cites “clear admissions of wrongdoing made by former FCA executives” as its main evidence, and also points the finger at the now deceased Sergio Marchionne, who according to Forbes, citing the GM court papers, was responsible for approving some $1.5 million in bribes to UAW officials.
GM asks an undisclosed amount in damages, but that could amount to billions of dollars, as well as punitive damages and costs.
GM did not say why it is filing the lawsuit just now, years after the alleged wrongdoings occurred. This is a point FCA made itself, saying it is “astonished by this filing, both its content and its timing.”
FCA is accusing GM of trying to disrupt the merger talks with PSA and the negotiations with the UAW, and says it will defend itself with all its power.
“FCA will deal with this extraordinary attempt at distraction through the appropriate channels and will stay focused on continuing to deliver record results while realizing an exciting vision for the future of the industry,” said FCA in a statement.
“FCA is confident that it will prevail in defending itself against these claims in court and will also pursue all available remedies in response to this groundless lawsuit.”
You can have a look at the opening statements in what is shaping up to be a lengthy struggle in the press release section below.
GM says FCA is corrupt to the bone, and tried to use its influence over the years “to undermine the integrity of the collective bargaining process and cause GM substantial damages.” More precisely, GM accuses FCA of paying millions of dollars in bribes to obtain "benefits, concessions, and advantages in the negotiation, implementation, and administration of labor agreements over time.”
This, says the carmaker, caused “unfair labor costs and operational advantages, causing harm to GM.”
GM cites “clear admissions of wrongdoing made by former FCA executives” as its main evidence, and also points the finger at the now deceased Sergio Marchionne, who according to Forbes, citing the GM court papers, was responsible for approving some $1.5 million in bribes to UAW officials.
GM asks an undisclosed amount in damages, but that could amount to billions of dollars, as well as punitive damages and costs.
GM did not say why it is filing the lawsuit just now, years after the alleged wrongdoings occurred. This is a point FCA made itself, saying it is “astonished by this filing, both its content and its timing.”
FCA is accusing GM of trying to disrupt the merger talks with PSA and the negotiations with the UAW, and says it will defend itself with all its power.
“FCA will deal with this extraordinary attempt at distraction through the appropriate channels and will stay focused on continuing to deliver record results while realizing an exciting vision for the future of the industry,” said FCA in a statement.
“FCA is confident that it will prevail in defending itself against these claims in court and will also pursue all available remedies in response to this groundless lawsuit.”
You can have a look at the opening statements in what is shaping up to be a lengthy struggle in the press release section below.
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