Automotive News [sub] reports that 19 rejected Canadian GM dealers have been given the green light to sue GM as a class, rather than go through the arbitration process that is being used to resolve dealer cull disputes in the US. The dealers are suing GM for breach of their dealer agreements, and for failing to provide compensation beyond wind-down costs. They argue that the arbitration process would be expensive for dealers, non-transparent to the taxpayers who funded GM’s reorganization, and would put GM at an unfair advantage.
One dealer explains:
For GM it would have been divide and conquer and control the flow of information.
Superior Court Judge Sarah Pepall agreed, ruling that the dealers have a common cause against GM and should be able to pursue their claims jointly in public court. Another lawsuit by Canadian GM dealers, naming both General Motors and its Canadian counsel, and alleging misconduct in the execution of the Canadian dealer cull is still pending. The very public drama between GM and its dealers that began with its bankruptcy-era cull of 1,573 dealerships may be nearly a year old now, but it’s showing few signs of stopping any time soon.