Friday, October 24, 2014

 

U.S. appeals court rules for GM over Spyker's Saab sale

General Motors Co (GM.N) persuaded a federal appeals court to uphold the dismissal of a $3 billion lawsuit in which Spyker NV (SPYKF.PK) accused it of derailing a plan to sell the Swedish automaker Saab to a Chinese company.

The 6th U.S. Circuit Court of Appeals in Cincinnati on Friday said Spyker failed to show GM intentionally interfered with the Dutch company's effort to sell Saab to Zhejiang Youngman Lotus Automobile Co, leading to Saab's bankruptcy.

GM had sold a majority of Saab to Spyker in 2010. As part of that sale, it licensed Saab to build vehicles using the Detroit-based automaker's intellectual property, and retained a right to end the license if Saab were sold without its consent.

Spyker said it was in sale talks with Youngman in December 2011 when a GM spokesman made statements suggesting that consent would not be provided, and that a sale might hurt GM. Youngman said it decided to back out "due to GM's position."

Writing for a three-judge 6th Circuit panel, Circuit Judge Eugene Siler said GM's statements were not malicious, and that it had "legitimate business concerns" about the sale, including who would benefit from Saab's use of its technology.

Siler also called Spyker's claim "fatally flawed" because it assumed that GM misinterpreted the license agreement, meaning the spokesman's statements "would have at most amounted to a mistake."

Friday's decision upheld a June 2013 ruling by U.S. District Judge Gershwin Drain in Flint, Michigan.

A lawyer for Spyker declined to comment immediately.

GM spokesman Alan Adler said in an emailed statement: "GM is very pleased that both the district court and now the Court of Appeals have determined that GM acted properly."

Saab's assets were bought out of bankruptcy in 2012 by China's National Electric Vehicle Sweden.

NEVS stopped building cars in May because of a lack of money, and in August won creditor protection in Sweden so it could seek new funds.

GM shares closed down 89 cents, or 2.9 percent, at $30.04 on Friday.

The case is Saab Automobile AB et al v. General Motors Co, 6th U.S. Circuit Court of Appeals, No. 13-1899.
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