Re: Chrysler Dealers and Quo Warranto

Just a quick update on the Quo Warranto aspect of our representing the Chrysler dealers.  Both Steve Pidgeon and I agree that our clients should exhaust all possible remedies pertaining to the Chrysler bankruptcy before seeking Ex Relator status in the DC District Court.  Filing a petition now in the DC District Court would be premature as we’ve recently filed a Notice of Appeal with the Southern District of New York.   But we do represent 82 former Chrysler dealers – led by James Anderer – who support a future quo warranto action.

Furthermore, it’s important to note that the bankruptcy action does not allege the Government sought dealer rejections.  Our case relies on the record of the entire bankruptcy proceeding which unequivocally exhibits that – while dealer restructuring was a future goal of New Chrysler – all key witnesses, including Old Chrysler’s CEO and Fiat executive Alfredo Altavilla, testified that neither the US Government nor Fiat ever requested dealer restructuring as a condition precedent to the deal closing.  The record is crystal clear on that issue.  Judge Gonzalez changed Alfredo’s answer in his Rejection Opinion by an act of judicial ventriloquism.

Therefore, the record exhibits that the Government was not directly involved in the decision to reject the Chrysler dealers.  Whereas, the quo warranto will be based on a “but for” argument pertaining to unconstitutional use of TARP funds.  But for the improper use of TARP funds, the Government would not have gifted Chrysler to Fiat and our clients would not have had their businesses ripped from them.

It’s an important legal distinction between the underlying bankruptcy case and the pending quo warranto.

Leo C. Donofrio, Esq. for the Law Office of Pidgeon & Donofrio GP

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