Chrysler accused of inflating sales
2dealerships file civil racketeering suit against automaker
Two Fiat Chrysler dealerships have accused the company of conspiring to inflate sales, sparking a sell-off in the Italian automaker’s stock.
The dealers, one in Illinois and one in Florida, filed a civil racketeering lawsuit against the automaker, saying the company had paid certain dealers to report false sales to “create the appearance that FCA’s performance is better than, in reality, it actually is.”
The dealers that filed the lawsuit — Napleton’s Arlington Heights Chrysler Dodge Jeep Ram in Arlington Heights, Ill., and Napleton’s Northlake Chrysler Dodge Jeep Ram in Lake Park, Fla.— are part of the Napleton Automotive Group.
The lawsuit comes after Fiat Chrysler recently posted its 69th consecutive month of gains in U.S. sales, which have been hailed as the pillar of the compa- ny’s global operations. Fiat Chrysler’s U.S. brands are Ram, Jeep, Chrysler, Dodge and Alfa Romeo, and its U.S. headquarters are located in Auburn Hills, Mich.
The feud raises the specter of yet another embarrassing episode for the auto industry, which has faced a series of scandals involving defects, emissions and regulatory failures that have undermined the public trust.
Fiat Chrysler, in a statement, harshly dismissed the claims as “without merit.”
“This lawsuit is nothing more than the product of two disgruntled dealers who have failed to perform their obligations under the dealer agreements they signed with FCA US. They have consistently failed to perform since at least 2012 and have also used the threats of litigation over the last severalmonths in a wrongful attempt to compel FCA US to reserve special treatment for them.”
The suit alleges that dealership principal Edward Napleton was asked, but refused, to falsely report sales of 40 vehicles in exchange for $20,000, which would have been distributed by Fiat Chrysler to the dealership’s advertising budget.
That came after a lower-level employee agreed to falsely report the sale of 16 vehicles without permission of upper management, according to the suit.
A lawyer for the dealers, who are seeking unspecified damages, including attorney’s fees, was not available for comment Thursday.