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August 03, 2020

US judge orders talks between GM, FCA to resolve 'legal diversion' - Tip News

US judge orders talks between GM, FCA to resolve 'legal diversion'

US judge orders talks between GM, FCA to resolve 'legal diversion'
'A federal judge ordered GM Chief Executive Mary Barra to meet with her counterpart at FCA to try to resolve litigation for the good of the country' - By: GETTY IMAGES NORTH AMERICA/AFP/File Drew Angerer

A federal judge directed top executives from General Motors and Fiat Chrysler to meet to resolve a lawsuit between the auto giants that he called "a waste of time."

In an extraordinary order, US District Judge Paul Borman called on GM Chief Executive Mary Barra and FCA Chief Executive Michael Manley to meet personally in the next week to work out the dispute for the good of the country.

Borman said the world has "changed dramatically" since GM filed the suit against FCA in November, citing the coronavirus crisis and mass protests for racial justice

"What a waste of time and resources, now and for the years to come in this mega litigation, if these automotive leaders and their large teams of lawyers, are required to focus significant time-consuming efforts to pursue this 'nuclear option' lawsuit, if it goes forward," Borman said in an order Tuesday following a hearing.

Borman noted both companies received federal support following the 2008 financial crisis.

"Today our country needs, and deserves, that these now-healthy great companies pay us back, by also focusing on rescuing this country and its citizens from the plagues of COVID-19, racism and injustice, while building the best motor vehicles in the world," Borman wrote in the four-page order.

In the suit, GM alleged that FCA bribed auto union officials to secure an unfair advantage in labor talks and try to force it into a merger with FCA.

GM's complaint, which contained salacious details about extravagant gifts and meals, was built on a massive federal corruption probe of the United Auto Workers. FCA has fought the suit and called its claims baseless and a perversion of a US law aimed at organized crime.

Borman directed Barra and Manley to meet in person with social distancing by July 1.

"Time is of the essence," Borman wrote, underlining the sentence.

"So, I repeat; Mary Barra and Michael Manley, meet face-to-face, in good faith, and with good will, to resolve this huge legal diversion."

In a statement, GM said while it had a "very strong" racketeering case Barra was looking forward to "constructive dialogue with FCA consistent with the Court's order."

FCA said it looked forward to the meeting and to "ideally put this matter behind us," the company said in a statement.

"We agree with Judge Borman's observation that these are extraordinary times for our country, particularly in light of the COVID-19 pandemic and the tragic death of George Floyd and the spotlight it has focused on racism and social justice," FCA said.

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