General Motors and Fiat Chrysler Automobiles

Fiat asks judge to reject General Motors request over racketeering case

Fiat Chrysler Automobiles (FCA) on Monday asked a U.S. federal judge to reject a request lodged by General Motors to reinstate a racketeering lawsuit against FCA, comparing a recent filing of GM to a “third-rate spy movie, full of preposterous allegations”.

Last week, GM asked U.S. District Judge Paul Borman to restart the case, claiming it had new details on foreign accounts used in an alleged bribery scheme which involved FCA and leaders of the United Auto Workers (UAW) union.

When it first filed the lawsuit last year, GM claimed that FCA bribed UAW officials for many years to corrupt the collective bargaining process and gain advantages, costing GM billions. GM was looking for “substantial damages” that one analyst said could have amounted to at least $6 billion.

But last month, Borman turned down the racketeering lawsuit, saying GM’s alleged injuries were not caused by alleged violations of FCA.

In its recent filing, FCA stated that as it operates facilities in more than 40 other countries, the existence of foreign bank accounts is “unremarkable, and certainly not illegal”.

After FCA’s filing, GM said it aims to uncover “the full extent of harm the FCA bribery scheme caused GM”.

“FCA’s corruption of the collective bargaining process remains undeniable,” GM said.

FCA is set to merge with France’s PSA by the first quarter of 2021.

“It is… clear to me that this series of attacks is directly related to our success in competing and winning where it matters, in the market,” wrote Mike Manley, CEO of FCA, on Monday in a letter to workers. “The consistent strengths we’ve demonstrated over the last decade will be deployed to even greater effect as we complete our merger with Groupe PSA.”

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