More bad news for Fiat Chrysler Ordered to Face Dealerships Antitrust Suit

Fiat Chrysler Automobiles NV’s U.S. unit has been accused that it pushed dealers to submit fraudulent sales numbers to prop up the carmaker’s share price.

Napleton’s Arlington Heights Motors in Illinois sued Fiat Chrysler in January, alleging racketeering, violations of antitrust laws and breach of contract. U.S. District Judge Virginia Kendall in Chicago threw out the racketeering claim, while rejecting Fiat’s motion to dismiss antitrust and other claims.

Allegations in the lawsuit spurred a U.S. Justice Department investigation into whether aberrations in reported sales figures as filed with the Securities and Exchange Commission misled shareholders about the health of the company. The automaker, which restated the past 5 1/2 years of sales results in July, said at the time that its counting methodology had been in place for decades and included safeguards to ensure sales weren’t double counted.

Investigators are examining whether Fiat Chrysler improperly adjusted monthly numbers to show growth over the prior year, a person familiar with the matter said. They are looking into allegations the company ordered dealers to create false vehicle purchases, some of which were made in the names of friends and relatives of salespeople, including underage family members, the person said.

The dealerships said in the lawsuit that Fiat Chrysler “stacked the deck against plaintiffs by soliciting fraudulent sales reports from certain dealers, and by using the numbers generated from these false sales to further subsidize plaintiffs’ competing dealers and to allocate hotter selling vehicles to them.’’