Newport Beach, California (September 15, 2015) – The U.S. Federal Court of Claims in Washington D.C. has denied the Justice Department’s motion to dismiss a lawsuit brought by a consortium of Chrysler dealers against the federal government.
The lawsuit alleges that in 2009 the Treasury Department provided billions of dollars in TARP funds to Chrysler on the condition that the automaker terminate a substantial portion of its franchised dealers. After 789 dealers were terminated, MLG Automotive Law filed a lawsuit against the government, alleging that the events amounted to an unconstitutional “taking” in violation of the Fifth Amendment. The case, Spitzer Motor City v. U.S., has been consolidated with claims brought by two other dealer groups.
After a host of procedural hurdles, including an interlocutory appeal to the U.S. Court of Appeal, last Wednesday the Federal Court of Claims denied the Justice Department’s motion to dismiss, paving the way for the case to proceed.
In a case that has the potential of making new law and ultimately being decided by the U.S. Supreme Court, the decision is a major step in validating the dealers’ claims. “I could not be more pleased with the court’s decision,” said Jonathan Michaels, founding member of MLG Automotive Law. “We look forward to vindicating the rights of our dealers, and restoring their tremendous economic loss.”
Michaels continued, “One of the most amazing attributes of our country is that our government is not above reproach. True freedom is a justice system that not only tolerates it, but demands it.”
About MLG Automotive Law
Located in Newport Beach, California, MLG Automotive Law is a full service business law firm, focusing on the automotive industry. MLG Automotive Law has litigated cases against nearly every major manufacturer, and is counsel on the GM ignition switch class action. Follow MLG Automotive Law on Facebook, LinkedIn and Twitter.