GM sued Fiat Chrysler in November over alleged corrupt union negotiations, a lawsuit that later dismissed although so far has refused to die. things became spicier last week when GM said the FCA had a “mole” inside the GM. Today, the FCA said that GM’s allegations “would make John Le Carré hug.”
The documents were filed in response to GM asking U.S. District Judge Paul Borman to reinstate the suit last week, while also talking about “mole” and various offshore bank accounts GM said it had discovered since filing the original complaint. That complaint alleges that the FCA sabotaged GM’s contract negotiations with the UAW, which in turn gave the FCA a competitive advantage in terms of lower labor costs.
The FCA has denied GM’s version of events all along, but the new “mole” allegations were openly ridiculous. The spiciest part of the legal documents filed today:
GM’s proposed amended complaint reads like a script from a third-class spy film, full of critical accusations that the FCA did not pay one, but two, “mole[s]”To” infiltrate GM ”and“ funnel internal information to [FCA]”With money” stash “in a” wide network “of” secret abroad [bank] accounts. ” (Movement 2, 5, 7-8, 20-21.) None of this is true. The fact that GM has extended its attacks to individual FCA officials and employees and made wild accusations against them without a bit of actual support is despicable.
In addition to compiling an unfounded “corporate espionage” story that would make John Le Carré cringe (Motion 21), GM (i) erroneously attempts to reconsider the standard of “direct causation” under RICO, (ii) erroneously represents the legal standard governing leave to amend after the judgment has been rendered, and (iii) accuses the court of committing a “manifest error” by rejecting the complaint without granting GM the right to amend, even though GM spent two years preparing its original complaint and did not previously requested leave to change. GM is wrong in every way.
This proposal is the latest example of the lengths GM is prepared to go to attack the FCA and accuses the court of misunderstandings along the way. GM’s fictional account of “corporate espionage” is based entirely on two imperceptible allegations:
1. FCA – a Dutch company headquartered in the United Kingdom, with subsidiaries operating in Italy and more than 40 other countries, and sales to customers in more than 130 countries – has “foreign bank accounts” in “countries such as Switzerland, Luxembourg, Liechtenstein , Italy, Singapore, the Cayman Islands and others. ”(Motion 5.) It is impossible to label and certainly not illegal.
2. Individuals – such as Alphons Iacobelli (who was hired by GM without asking the FCA for a reference after his termination by the FCA) and Joseph Ashton (a former UAW official who served on GM’s board and has no affiliation with the FCA ) —And hold or controlled bank accounts in some of the same countries. (AC ¶¶ 35, 43.) Even if it is true, there is nothing illegal about it.
Based solely on the “existence of [these] foreign bank accounts ”(Karis decl. ¶ 10), GM jumps to the bold conclusion that it exclusively appeals to“ information and belief ”that Iacobelli and Ashton were“ moles[s]”Paid by FCA through” secret abroad [bank] accounts “to” infiltrate GM, “” funnel internal information to [FCA]”And ensure that benefits and concessions provided to the FCA by the UAW were not also provided to GM. (Motions 2, 5, 7-8, 20-21.) No facts alleged in the proposed amended complaint – not a single one – support this outrageous speculative accusation.
GM issued the following statement on Monday in response to the FCA’s response, via Automotive News:
“The FCA’s corruption in the collective bargaining process remains undeniable – a federal investigation is underway and there have already been several guilty pleas,” GM said in a statement. “New facts revealed by GM’s investigation that the FCA is trying to discount – including offshore accounts in several countries – involve many individuals and make GM’s RICO cases even stronger. GM is trying to reveal in court the full extent of the damage caused by the FCA’s bribery system to GM. “
GM said nothing in the FCA’s response “considering the significance of these allegations and the direct harm that the defendants’ corruption caused GM, and the court should change its previous judgment and reopen our case.”
Everything gets a little involved, but this is what it looks like when both sides have seemingly unlimited amounts of money to spend on lawyers, in addition to all the time in the world. Borman, who was already very tired of this case, will likely make a quick decision on GM’s readmission application, but who can say where this case is going from there.
You can read the full FCAs answer below.