Bollywood Fever: Software vendors can band together as a class to sue automotive technology giant CDK Global for allegedly restricting access to data and causing them to pay hundreds of millions of dollars in overcharges, a federal judge in Chicago has ruled.
Chief U.S. District Judge Rebecca Pallmeyer on Tuesday said AutoLoop, which sells software to thousands of dealerships, had met the legal standard to certify its 2018 lawsuit against CDK into a class action with hundreds of other auto industry vendors. The vendors accused CDK of violating antitrust law by suppressing competition, seeking estimated damages of $395 million against the Austin, Texas-based CDK, which sells software platforms to dealers to run their daily sales, financing, and service operations.
The class includes vendors that create apps for inventory management, repair orders, warranty services, and other functions for dealer-management systems. CDK allegedly curtailed once-broad access to dealer systems, driving up the prices that AutoLoop and others pay to access data to power their apps.
CDK, AutoLoop, and attorneys for the two companies did not immediately respond to requests for comment on Wednesday. The court has not yet ruled on whether to certify a nationwide class of dealers.
Pallmeyer’s order sets the case up for a trial in Wisconsin, where the lawsuit originated before it was consolidated in Illinois, but no date has been set. CDK has denied any wrongdoing.
The class includes 244 software vendors that since October 2013 purchased data integration services from CDK or one of its rivals, Reynolds & Reynolds, which is not a defendant. Reynolds did not immediately respond to a request for comment on Wednesday. The company in 2018 settled claims lodged by car dealers for nearly $30 million.
CDK had fought class certification, arguing that there was no evidence that vendors all were harmed.
The case is In re Dealer Management Systems Antitrust Litigation, U.S. District Court for the Northern District of Illinois, No. 1:18-cv-00864.
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