20 former Chrysler dealers have no guarantee to reopen, Detroit judge rules

Article by Christian A., on March 29, 2012

Judge Sean Cox of U.S. District Court in Detroit has ruled that the Chrysler Group LLC former dealers, who lost their franchise deals and got them back in federal arbitration, do not necessarily have a right to reopen under the same market conditions as before, the judge said in its written ruling issued on Tuesday. He found that the federal Consolidated Appropriations Act of 2010, which gave rise to the arbitration procedure for terminated dealers, does not outrank the previous state laws over dealer markets. 

In essence, at least 20 former Chrysler dealers in Wisconsin, Michigan, Ohio, California, Florida and Nevada are the only ones that have deals with Chrysler to be included into its dealership network just like as if they were beginning an all-new business.

They may not be allowed to penetrate a market where another dealer is offering the same automobile brand and is disputing their presence. In addition, the dealers-at-issue are barred from requesting an order from a court to uphold a favorable arbitration ruling. They also cannot demand for any financial damages from Chrysler. Under his written ruling, Cox noted that Congress intended to offer to the concerned dealers a chance to be included into the new Chrysler's dealer network through a letter of intent.

He added that Congress chose not to draft the arbitration law in a way that the new Chrysler is mandated to enter into a sales and service agreement with any dealer that succeeded in its arbitration.

He further stated that the court concurs that the law was "carefully crafted by Congress" in order to avoid conflict with the state dealer acts "that have governed this area for decades." The company's attorneys sought an order from Cox to rule that the automaker complies with the Consolidated Appropriations Act. They have also asked for a declaration that the law does not require "unconditional reinstatement" or pre-empt a Michigan law governing dealer markets.

Topics: chrysler

If you liked the article, share on:

Pin It

Comments

Recommended

Tesla marked a major milestone as it surpassed Ford in market capitalization. Automaker Tesla, formerly known as Tesla Motors, closed out the trading on March 27, 2017, with a market...
by - March 30, 2017
The mid-cycle facelift for the Mercedes-Benz's S-Class have been disclosed to the public eye via these leaked shots. The images that recently surfaced and others like it were published online...
by - March 30, 2017
Reddit user Jdubbswrx spotted a rather deceptive move coming from the German automotive manufacturer Audi. He posted an image of the supposed exhaust of the new 2018 Audi SQ5 sporting...
by - March 29, 2017
McLaren car owners will be thanking the automotive company as it has decided to roll out new goodies for the 540C, 570S and 570GT sports car line-up. From this series...
by - March 29, 2017
On July 11, Audi is set to reveal its flagship luxury sedan, the all new A8. And at this moment, none of us are sure how this model will look....
by - March 29, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries