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GM Files New Bribery Lawsuit Against FCA

Fresh tack to be tested in a Michigan circuit court.
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General Motors isn’t giving up on its bribery and corporate espionage charges against Fiat Chrysler Automobiles.

GM struck out with its federal racketeering case at the federal level in Detroit. Now it’s trying its luck in a Michigan circuit court.

The kerfuffle began last November, when GM accused FCA of bribing United Auto Workers Union executives to gain more favorable labor contracts. A federal judge rejected the case in July and in August turned down GM’s bid to reinstate an amended complaint.

Last month a federal appeals court in Cincinnati upheld the lower court. GM has asked the higher court to reconsider.

Meanwhile, GM is trying out a new argument at the state level in Michigan.

New Angle

On Sept. 14 the company filed a trio of new complaints that allege FCA used offshore bank accounts to pay former FCA and UAW executives—both of whom ended up on GM’s payroll—to spy on GM’s labor planning activities.

Those are the same activities GM described in its amended federal lawsuit. But the carmaker says its new filings focus on a different point of law that didn’t come up earlier: breaches of fiduciary duties by the two employees. Translation: It’s a no-no to get paid by a rival company to spy on your employer.

GM cites Joe Ashton, a former UAW vice president who was appointed to its board of directors in 2014; and Alphons Iacobelli, an ex-FCA labor relations chief who later joined GM’s labor relations department.

Ashton pleaded guilty last December of money laundering and wire fraud involving funds intended for a joint FCA-UAW employee training center. Iacobelli is serving a 66-month prison term for conspiracy and tax evasion in the same scandal—the one that prompted GM’s original racketeering lawsuit against FCA.

What’s Next?

Whether GM’s complaint can gain traction isn’t clear. But the company certainly hasn’t given up on its pursuit for vindication over what it considers grievous harm, and which FCA defiantly dismisses as “preposterous conspiracy theories.”

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