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GM files appeal in RICO lawsuit against FCA

Kalea Hall Breana Noble
The Detroit News

Detroit — General Motors Co. is pushing forward with its racketeering lawsuit against Fiat Chrysler Automobiles NV in an appeal to the 6th Circuit Court of Appeals filed Tuesday. 

GM's case was cast aside by U.S. District Judge Paul Borman, even after the automaker presented new allegations in August that United Auto Workers leaders pocketed bribes from the Italian American automaker funneled through foreign bank accounts.

In its November 2019 lawsuit, GM accuses Fiat Chrysler's late CEO, Sergio Marchionne, of orchestrating a bribery conspiracy to corrupt three rounds of bargaining with the UAW in a bid to harm and take over Detroit's largest automaker. GM says it lost "billions" from the arrangement.

Fiat Chrysler sought to dismiss the case. The company on Tuesday referred to earlier statements in which it says it will defend itself against the "baseless" accusations.

Fiat Chrysler CEO Sergio Marchionne, left, and UAW President Dennis Williams  embraced  at the start of contract talks in 2015. GM charges that Marchionne orchestrated a bribery conspiracy to corrupt three rounds of bargaining with the UAW in an effort to harm and take over Detroit's biggest automaker.

“We are confident in our case and filed this appeal to continue to seek redress, as permitted under the law, for damages FCA’s systemic corruption caused GM," GM spokesman David Caldwell said in a statement. "We have a responsibility to our employees and shareholders to hold FCA accountable and seek justice when we are targeted and directly harmed. We look forward to presenting our case to the Sixth Circuit."

Borman dismissed the case with prejudice in early July, writing that it could be concluded that FCA executives worked to lower their own labor costs through bribing union leaders, but it could not be inferred the company "wanted to increase GM’s labor costs by asking the UAW to deny GM concessions that it otherwise would have given."

He also argued that GM wasn't the direct victim in the case, but that the UAW workers affected by FCA executives' bribery of union leaders were. 

GM in the Tuesday appeal called the district court's decision "patently wrong, and its refusal to grant GM leave to file an amended complaint to include allegations that further underscored FCA’s intent to harm GM was plainly an abuse of discretion."

khall@detroitnews.com

Twitter: @bykaleahall

bnoble@detroitnews.com

Twitter: @bcnoble