Judge: GM Not to be Blamed for Saab Bankruptcy
An U.S. federal judge dismissed Spyker NV’s lawsuit against General Motors (NYSE:GM) Monday, contending that the US automaker had the right to approve or disapprove Saab’s potential transaction with Zheijiang Yougman Lotus Automobile based on the conditions it outlined to Spyker when it sold Saab.
According to Reuters, the Dutch sports car maker filed a $3 billion lawsuit in August 2012 against GM over allegations that the company was trying to unfairly impede a deal between Saab and Youngman in an attempt to bankrupt the Swedish automaker.
But at the hearing in Detroit on Monday, U.S. District Court Judge Gershwin Drain asserted that GM had the right to stop the change of ownership based on the terms Spyker agreed to when it purchased Saab. Believing that GM’s opposition to Saab’s deal was not intentionally malicious, he made the decision to throw out the lawsuit.
GM’s attorney, Kathryn Kirmayer, did not express surprise over the judge’s decision. She contended that when Spyker bought Saab, it fully understood the conditions it was agreeing to. She also admitted to finding Spyker’s deal with Youngman, “sketchy in many respects.”
Spyker acquired Saab from GM in January 2010 after the US automaker decided to sell the brand in 2009 following the financial crisis. Less than two years after GM sold Saab to Spyker, the Swedish company stopped production in May 2011 when it could no longer pay suppliers and employees. It then filed for bankruptcy in late 2011 — just after Youngman pulled out of a potential deal.
Since its suspension of production, Saab has been working to gain an edge in the growing Chinese auto market, and has joined forces with the National Electric Vehicle Sweden AB ever since the consortium bought more of Saab’s assets last autumn.
Spyker Chief Executive Victor Muller has not yet announced if he will appeal the decision.
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