U.S. judge rejects General Motors bid to reopen racketeering case

General Motors and Fiat Chrysler Automobiles

A federal judge in Detroit on Friday turned down a bid by General Motors to reinstate a racketeering lawsuit against its Fiat Chrysler Automobiles (FCA).

GM had claimed that it had new details on foreign accounts used in an alleged bribery scheme involving FCA and leaders of the United Auto Workers (UAW) union. But U.S. District Judge Paul Borman said GM’s “newly discovered evidence is too speculative to warrant reopening this case”.

GM said it would appeal the ruling.

“Today’s decision is disappointing, as the corruption, in this case, is proven given the many guilty pleas from the ongoing federal investigation,” said General Motors.

“GM’s suit will continue – we will not accept corruption.”

“Judge Borman’s ruling this morning once again confirms what we have said from the beginning — that GM’s lawsuit is meritless — and its attempt to submit an amended complaint under the guise of asking the court to change its mind was nothing more than a baseless attempt to smear a competitor that is winning in the marketplace,” said FCA.

FCA had asked the judge to reject the request from GM and had compared GM’s filing to a “third-rate spy movie, full of preposterous allegations”.

When it first filed its lawsuit in 2019, GM alleged that FCA to have bribed UAW officials over many years to corrupt the collective bargaining process and gain advantages, costing GM billions of dollars. GM was looking “substantial damages” that one analyst said could have amounted to at least $6 billion.

In July, Borman turned down the racketeering lawsuit, saying GM’s alleged damages were not caused by FCA’s alleged violations.

FCA said that as it operates facilities in over 40 countries and the existence of foreign bank accounts is “unremarkable, and certainly not illegal”.

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