Ford Motor Co. discriminated against black customers by allowing dealers to charge them higher rates on vehicle loans, a federal judge ruled Wednesday in Nashville, Tenn.
The judgment in the class-action lawsuit was a loss for Primus Automotive Financial Services, which is a unit of Ford Motor Credit Corp.
U.S. District Court Judge Aleta Trauger, who oversaw the two-week trial, ordered Primus and the plaintiffs to negotiate for 30 days to find a way to end the discriminatory practices. The plaintiffs were not seeking damages in the case, but Primus will have to pay attorney fees.
The Primus case was the first of several such class action cases to go to trial. Other finance companies and banks, faced with similar lawsuits, have settled out of court. Those settlements usually included a cap on interest rate markups.
Dealers have traditionally been allowed to mark up, or add to the interest rate of loans they arranged for buyers. Many within the industry say the markup is justified as compensation for the effort to arrange the loan.
Before the trial started, Primus spokeswoman Meredith Libbey said the finance company didn't' settle because "the charges are without merit, and we see a trial as a way to defend our good name."