A ruling in U.S. Bankruptcy Court may quash state laws passed this year to help dealers spurned in the Chrysler and General Motors bankruptcies. The ruling also puts pressure on dealers and their representatives to come up with a federal solution to provide aid for the dealers.
Dealers rejected in the Chrysler and GM restructurings can face steep federal fines if they sue to get their franchise rights back. A Bankruptcy Court order threatened former Chrysler dealers in Wisconsin, Ohio and Arkansas with fines of $10,000 a day if they didn't withdraw their legal protests against the reorganized Chrysler Group by Thursday, Sept. 10.
The Aug. 31 order addressed specific Chrysler dealers who are asserting their rights under state franchise laws.