Dealers File Suit Against GM Canada & Parent Co.

After upwards of 40 recalls this spring and a class action lawsuit launched against the company in April, a group of prominent GM Canada dealers is suing the company and its parent General Motors Co.

Adria MacKenzie, corporate communications manager at GM Canada told Auto Remarketing Canada this morning, "A number of Toronto dealers have taken legal action against GM. The claims are without merit, and we plan to defend against them vigorously."

"We will continue to be focused on our customers," MacKenzie added.

According to a Sunday report from The Globe and Mail,  the dealers are suing on the basis that the automaker has ignored their requests for financial help in the light of a drastic drop in sales and market share in Toronto.

The group of dealers — which now sits at 17 — is being represented by the law firm Lax O’Sullivan Scott Lisus of Toronto, according to The Globe and Mail.

And this isn’t the first time GM Canada has been targeted by its dealers.

In fact, this suit makes the fourth time groups of former or current GM dealers have filed against GM Canada.

This news comes five years after the company went under Chapter 11 bankruptcy protection in 2009 and survived with help from a bailout from U.S. and Canada.

GM Canada said it will not provide further comment as the matter is before the courts.

This news comes on the heels of a Canadian class action suit filed in April.

Merchant Law Group LLP launched a Canada-wide class action against the manufacturer concerning the recall of the ignition-switch allegedly linked to 13 accidental deaths.

"The ignition switch defect is a widespread problem affecting more than 235,000 General Motors vehicles in Canada. Owners of these GM vehicles are at risk and can experience a sudden unexpected loss of power and engine shut down due to the ignition defect alleged by this class action.  Our class action seeks compensation for affected vehicle owners and proper repair of these GM vehicles," stated Tony Merchant, Q.C., of Merchant Law Group in April.

For more information, see the following Auto Remarketing Canada story:

Canadian Class Action Launched Against GM