Ex-Chrysler dealer in Missouri sues for reinstatement - KMOV.com

Ex-Chrysler dealer in Missouri sues for reinstatement

 

ST. LOUIS (AP) -- A year ago, Century Motor Corp. lost its Dodge, Chrysler and Jeep dealership. Now, the suburban St. Louis dealer is suing to force Chrysler to give it back.

The lawsuit filed Thursday in U.S. District Court in St. Louis also seeks unspecified damages from Chrysler Group LLC.

Phone calls on Tuesday to Century and its lawyer were not immediately returned. A Chrysler spokesman declined to discuss specifics of the case, saying the company had not yet been served the lawsuit.

Century was among 789 dealerships shut down by Chrysler in 2009 as part of the automaker's bankruptcy plan. Congress mandated the revoked dealerships be given the option to seek reinstatement through federal arbitration.

In May, an arbitrator ruled in favor of Century. The lawsuit said the arbitrator determined Century "shall be reinstated" and "added as a franchisee to the Chrysler dealer network."

But Chrysler said in a statement that dealers who win in arbitration still must meet certain requirements before rejoining the network.

The lawsuit said Chrysler has insisted Century sign a waiver letter that "among other things, would require Century to waive certain rights under the Missouri Motor Vehicle Franchise Practices Act ... and would grant Chrysler an option to purchase Century's real estate."

Century refused to sign.

"Congress intended that those dealers who prevailed in their arbitrations would be restored to Chrysler's dealer network," the lawsuit contends. "By conditioning that outcome on the dealers' execution of the unlawful waiver letter, Chrysler is intentionally, knowingly and willfully thwarting the law."

Century was among several former Chrysler dealerships that sought arbitration. Chrysler said in a statement that federal arbitrators have ruled for the company 37 times and for dealers 13 times. More than 125 cases were withdrawn, dismissed or abandoned, and fewer than 50 remain to be arbitrated.

"The actions to right-size our dealer network were a necessary part of Chrysler's viability, approved by a federal bankruptcy court and central to the interim financing and partnership with Fiat," Chrysler's statement read. "The only alternative would have been complete liquidation, which would have resulted in all 3,200 dealers closing, hundreds of thousands of lost jobs, and the company defaulting on taxpayer loans.

"While we are pleased that the decisions of many arbitrators reflect a keen appreciation of these circumstances, Chrysler Group is disappointed that some decisions undermine the Federal Bankruptcy Court Order that affirmed the rationalization process used to reject the dealership agreements."

(Copyright 2010 by The Associated Press. All Rights Reserved.)

Powered by Frankly