Bloomberg News

Ford Overcharged Trucker Dealers, Jury Told in Retrial (1)

August 23, 2013

Ford Motor Co. (F:US) overcharged commercial truck dealers for 11 years, a lawyer said in the retrial in a lawsuit that initially resulted in a $2 billion judgment against the company.

“This case is about Ford breaking a contract promise it made to treat all of its dealers equally,” Dennis Mulvihill, a lawyer for the dealers, said today in his opening statement in the trial in Cleveland state court.

Ford engaged in “a secret pricing scheme” that allowed the company to take retail profits from dealers, he said. “They charged dealers too much money for these trucks.”

The dealers sued Ford in 2002, claiming the company broke an agreement to sell trucks at published prices, which forced them to pay more from 1987 through 1998. Cuyahoga County Judge Peter J. Corrigan in 2011 awarded $2 billion, including about $1.2 billion in interest, to a class of about 3,000 dealers.

A state appeals court ordered a new trial last year, finding Corrigan improperly excluded evidence that might have helped the company. The dealers will be seeking $2 billion again, plus additional interest, James Lowe, another lawyer for the dealers, said in an interview before trial.

Lower Prices

The liability is “pretty clear,” Lowe said. “The contract was breached and if not for that breach the dealers would have gotten lower prices.”

Ford has denied any breaches or overcharging. The company has also asked Corrigan, who will be conducting the new trial, to reverse his 2005 decision allowing the dealers to pursue the claims as a group.

The case is Westgate Ford Truck Sales Inc. v. Ford Motor Co., CV 02-483526, Court of Common Pleas, Cuyahoga County, Ohio (Cleveland). The appellate case is Westgate Ford Truck Sales Inc. v. Ford Motor Co., 2012-Ohio-1942, Court of Appeals of Ohio, Eighth Appellate District, County of Cuyahoga (Cleveland).

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