By on August 11, 2020

General Motors desperately wants to reopen a case dismissed last month by a federal judge, but Fiat Chrysler’s having none of it.

The racketeering lawsuit filed by GM against its crosstown rival alleged that FCA secured unfair labor advantages over GM via bribed UAW officials, with the automaker claiming last week that it possesses new evidence capable of convicting its automotive foe. A number of offshore bank accounts fueled the bribery effort, GM claims, with the automaker’s court filing accusing former UAW Vice President (and ex-GM board member) Joe Ashton of being a paid mole.

Gripping stuff, but FCA says it’s seen this movie before — and it’s a stinker.

According to Reuters, FCA has requested U.S. District Judge Paul Borman to pay no attention to GM’s request, saying its rival’s allegations amount to a “third-rate spy movie, full of preposterous allegations.”

The conviction of Ashton and imprisonment of former FCA labor negotiator Alphons Iacobelli, as well as the sweeping federal investigation into corruption and bribery at the highest levels of the UAW gives GM’s lawsuit weight, but the automaker won’t be able to prove anything unless it gets its day in court. Former UAW president Dennis Williams is also named in the suit as a beneficiary of FCA’s alleged bribery scheme.

GM has claimed since the outset that corrupted bargaining practices left FCA with an unfair labor cost advantage over its domestic rivals, costing its own operations billions. It wanted to collect, and still does.

In a court filing early last week, GM claimed that FCA’s bribery cash flowed by way of bank accounts in the Cayman Islands, Switzerland, Luxembourg, Liechtenstein, Italy, and Singapore. FCA says it’s all bunk, stating to the judge that it operates facilities in dozens of countries. As such, the number of offshore accounts is “unremarkable, and certainly not illegal.”

Continuing, FCA said the naming of FCA officials was a “despicable” act reminiscent of the McCarthy witch hunt of the 1950s.

In a letter seen by Reuters on Monday, FCA CEO Mike Manley told employees that GM’s efforts amount to a case of sour grapes.

“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,” Manley wrote. “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.”

Unswayed by FCA’s new filing, GM remained adamant that it would reveal “the full extent of harm the FCA bribery scheme caused GM,” stating that, “FCA’s corruption of the collective bargaining process remains undeniable.”

[Image: Daniel J. Macy/Shutterstock]
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7 Comments on “Fiat Chrysler to Judge: GM’s Being Paranoid, Please Ignore...”

  • avatar
    Steve Biro

    Perhaps GM should concentrate on making desirable cars and trucks. They’d make a lot more money that way than retreating from every market that requires any effort to succeed in. Shaking down the competition for cash isn’t a viable business strategy.

  • avatar

    “GM is being despicable,” is the media quote I read today.

    Newsflash: GM’s CFO is leaving.

  • avatar

    A Mary Barra obsession. She just can’t accept that it is her mismanagement that has damaged GM. New evidence? Obtained illegally? Or just more bullsh*t.

  • avatar

    FCA did indeed bribe their way into lower labor rates under Sergio’s rule. But whether or not that led to damages inflicted on GM (and Ford, for that matter) is dubious at best. If anyone should be claiming actual damages against FCA, it should be the UAW members who were paid less than their counterparts as a result of the shenanigans. But the UAW members at FCA arent going to do anything.

    Maybe if GM started making their half-ton trucks in the USA and, you know, actually did something with the interior other than China pressed plastics, they could start actually making money on sales rather than lawsuits. The Silverado has two leading powertrains that seem to get a lot of industry praise – but spending time inside the truck is depressing compared to Ram.

  • avatar

    GM has bankrupted itself once already in this century; pursuing this now will only lead to another far sooner than necessary.

  • avatar
    SCE to AUX

    Maybe the UAW should simply negotiate the same payscales for all workers, regardless of employer. Then the mfrs can treat the UAW as a labor pool from which to draw.

    • 0 avatar

      @SCE to AUX: That actually makes sense. But then you’d see the OEMs complaining about industrial espionage when an employee gets laid off from one and hired at another, right after which the second OEM adopts a product type or technique that was recent IP for the first.

      They never will get along.

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