Antitrust Law Daily Wrap Up, FRANCHISING & DISTRIBUTION NEWS: Supreme Court declines to review Ford’s refusal to supply heavy trucks and parts to dealers, (Apr 1, 2014)

By Linda O’Brien, J.D., LL.M.

The U.S. Supreme Court will not review a Third Circuit decision that overturned a breach of contract ruling against Ford Motor Company for ceasing its supply of trucks and parts to its truck dealers. The appellate court ruled that the dealership agreements were not breached since Ford continued to supply the dealers with truck parts. The Court denied the dealers’ petition for certiorari on March 31. The petition was docketed on January 22, 2014 (Bayshore Ford Truck Sales, Inc. v. Ford Motor Co., Dkt. 13-886).

The dispute arose after Ford sold its heavy truck manufacturing and parts business in 1997 to competitor Freightliner for $300 million. Pursuant to this agreement, Ford stopped accepting orders from its dealers for heavy duty trucks and parts. As a consequence of this sale, the complaining dealers lost tens of millions of dollars in sales, the dealers claimed. The dealers brought a breach of contract suit against Ford in the United States District Court for the District of New Jersey on behalf of a class of Ford heavy truck dealers. The federal district court granted the dealers summary judgment on the breach of contract claim, and a jury returned individual verdicts for the eleven dealers.

On appeal, the Third Circuit reversed the district court on the ground of factual mistake. Subsequently, the appeals court denied the dealers’ petition for panel rehearing and rehearing en banc. The federal district court concluded that it was required to apply the Third Circuit ruling

In the petition, the dealers questioned whether, in this case which involved significant harm to a substantial group of parties, the court of appeals’ sua sponte invention of an indisputably false fact that was the sole premise of its ruling departed from the ordinary and usual course of proceedings so that the judgment should be summarily reversed.

Attorneys: Eric L. Chase and Genevieve K. LaRobardier (Bressler, Amery & Ross, P.C.); Thomas C. Goldstein and Kevin K Russell (Goldstein & Russell, P.C.); James P. Ulwick, Jean E. Lewis, and Steven M. Klepper (Kramon & Graham, P.A.) for Bayshore Ford Truck Sales, Inc.

Companies: Bayshore Truck Sales, Inc.; Ford Motor Company

News: FranchisingDistribution