Fiat Chrysler to face antitrust charges in dealer suit

Michael Wayland
The Detroit News

Fiat Chrysler Automobiles NV will continue to face allegations it violated antitrust laws as part of a lawsuit filed by one of its franchised dealership groups claiming it encouraged dealers to submit fraudulent sales numbers.

U.S. District Judge Virginia Kendall in Chicago on Tuesday partially denied a motion by FCA US — the company’s North American-based operations — to dismiss 14 charges against the company by Illinois-based Napleton’s Arlington Heights Motors. She threw out several charges, including fraud and racketeering claims, but ruled the company will continue to face allegations of antitrust law violations, breach of contract and others.

The auto dealer, according to the court, “pled enough factual allegations” and “presented sufficient allegations” to support the antitrust allegations against the automaker.

FCA US in an emailed statement following the ruling said it “is pleased the court dismissed some of the more serious claims in Napleton’s complaint.” It added: “We remain committed to continuing a vigorous defense on the claims that remain.”

Two dealerships owned by Edward F. Napleton filed a civil racketeering suit against the automaker in January, alleging the company, among other claims, offered dealers money to report unsold vehicles as sold.

The complaint was amended in March to include five additional Napleton-owned dealerships and to add other allegations and details, according to court documents.

The charges being upheld add more pressure to the company, as it faces investigations by the U.S. Justice Department and Securities and Exchange Commission over its monthly sales reporting practices, which FCA US overhauled in July — retroactively changing its monthly sales reports since 2011.

A company spokesman on Tuesday said FCA US is continuing to cooperate with the federal probes, which are believed to have stemmed from allegations in the lawsuit by the Napleton-owned dealers.

An attorney for Napleton could not immediately be reached for comment.