DETROIT — A federal judge abused his power when he ordered the CEOs of General Motors and Fiat Chrysler Automobiles to meet in an effort to settle a racketeering lawsuit filed by GM, an appeals court ruled Monday.
But the appeals court denied GM’s request to have a new judge handle the case, in which GM accuses FCA of bribing union leaders to gain a labor-cost advantage.
Monday’s ruling said U.S. District Judge Paul Borman failed to consider other possible remedies when he ordered GM’s Mary Barra and FCA’s Mike Manley to meet in person. The 6th U.S. Circuit Court of Appeals also said Borman’s reasoning — that the lawsuit would distract the companies from dealing with the coronavirus pandemic and recent racial tensions across the country — was unrelated to the case at hand.
The appeals court said Borman could, however, order mediation or a settlement conference in order to encourage the two automakers to reach a resolution without a trial.
GM had sought to have the case reassigned to a new judge, arguing that Borman’s description of the case as a “waste of time and resources” shows that he could not be impartial. GM’s petition said Borman exercised a “profound abuse” of power.
The automaker, in a statement Monday, said it was glad the court granted its appeal and that the company has a responsibility to its stakeholders to “seek justice and hold FCA accountable.”
FCA has repeatedly denied GM’s claims and called the suit “meritless.”