The GM lawsuit accuses Fiat Chrysler of violating federal racketeering laws. File Photo by Brian Kersey/UPI |
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Nov. 20 (UPI) -- General Motors filed a racketeering lawsuit Wednesday against competitor and rival Fiat Chrysler Automobiles, accusing the automaker of engaging for years in a pattern of corruption to undermine contract negotiations with union workers.
GM cites in the suit admissions of wrongdoing by FCA executives in a continuing criminal corruption investigation by the U.S. Attorney's Office. It also says FCA bribed United Auto Workers union officials to receive more favorable terms in labor negotiations.
The suit says the corrupt activity has cost GM billions of dollars over the past decade.
"FCA was the clear sponsor of pervasive wrongdoing, paying millions of dollars in bribes to obtain benefits, concessions, and advantages in the negotiation, implementation, and administration of labor agreements over time," General Motors said in a statement. "FCA corrupted the implementation of the 2009 collective bargaining agreement [with the United Auto Workers]. It also corrupted the negotiation, implementation, and administration of the 2011 and 2015 agreements.
"FCA's manipulation of the collective bargaining process resulted in unfair labor costs and operational advantages, causing harm to GM."
The suit says there was bribery at Fiat Chrysler's highest executive levels and included late CEO Sergio Marchionne.
FCA responded to GM's lawsuit with great surprise.
"We are astonished by this filing, both its content and its timing," FCA said in an emailed statement to UPI. "We can only assume this was intended to disrupt our proposed merger with [European carmaking consortium PSA] as well as our ongoing negotiations with the UAW.
"We intend to vigorously defend against this meritless lawsuit and pursue all legal remedies in response to it."
Federal prosecutors charged retired UAW Vice President Joseph Ashton last month with fraud and money laundering. They said he received hundreds of thousands of dollars in kickbacks and used his position to illegally benefit himself and others. Thirteen people have so far been charged in the investigation -- and seven union leaders and three FCA executives have been convicted.
The UAW announced anti-corruption reforms last week, including the creation of an independent ethics officer position.
GM doesn't specify monetary damages in the suit, but says any will be "invested in the U.S. to benefit GM's employees and grow jobs."
