Alley's Kingsport, Inc. v. United States

Complaint on behalf of 60 former-Chrysler dealers


60 former Chrsler dealers have filed a takings lawsuit in the U.S. Court of Federal Claims, seeking $130 million in just compensation for the federally mandated termination of their dealerships. The takings arise from the federal requirement imposed as a condition of Chrysler's receiving federal TARP funding. The U.S. Treasury Department's Auto Task Forced Required Chrysler to file bankruptcy and to terminate 789 of its dealers (25% of it news dealerships), representing 15% of Chrysler's revenue.

Without TARP funding, Chrysler would have been forced to liquidate and cease its operations.

The Government-imposed conditions on Chrysler receiving the TARP funding reflected the Government's overall economic recovery plan. And the dealership termination requirement was intended to save Chysler money, but numerous studies show that the deaers are not really a cost factor. This is because dealers are self-sufficient and pay all of their own costs.

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Reference Info:Pleadings | Federal, Federal Circuit, Claims Court | United States

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Nancie G. Marzulla, Marzulla Law, LLC | Attorney Advertising

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