WASHINGTON -- The Colorado House today passed a bill that would impose fines of up to $25,000 a day on Chrysler Group if it continues to defy a new state law requiring dealer reinstatement under certain circumstances.
The bill now goes to Gov. Bill Ritter for final approval. It passed the Colorado Senate last week.
The fate of the legislation, even if signed by the governor, is unclear because Chrysler has asked the U.S. Bankruptcy Court to block the dealer reinstatement law.
The House bill today passed 54-11, said an aide to Democratic state Rep. Joe Rice, a co-sponsor.
In a statement e-mailed today to Automotive News, Chrysler said it "strongly believes that these state rejected dealer statutes, as well as the statutes recently enacted in Colorado, are unconstitutional attempts to overturn binding and clear orders issued in (the old Chrysler's) Bankruptcy Court proceedings, and are not in the public interest.
"Chrysler Group is confident the difficult decisions made during bankruptcy will continue to position the company for sustainable success and, ultimately, will enable the company to repay the U.S. Taxpayers in a timely manner."
The Colorado law, enacted in March, requires Chrysler and General Motors Co. to offer a rejected dealership the right of first refusal if either company wants to open a point in the rejected dealer’s old market.
If the automaker already has awarded such a franchise, it must offer to reinstate the rejected dealership or compensate it.
Chrysler told at least one rejected Colorado dealer who requested reinstatement last month that it has no intention of offering reinstatement under the new state law.