Proposed Class-Action Suit Against FCA, UAW Dismissed

Judge says plaintiffs haven't exhausted contractual remedies yet.

by on Aug.30, 2018

Former UAW President Dennis Williams maintained that the collective bargaining process between the UAW and FCA wasn't tainted.

A U.S. District Court has dismissed a proposed class action by autoworkers against car maker Fiat Chrysler and the United Automobile Workers that claimed the company and union colluded to sacrifice workers’ interests during collective bargaining.

The judge, following a long line of precedents, ruled that the workers who brought the suit have not exhausted contractual remedies and internal procedures to address their grievances against the company and the union.

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The lawsuit, filed by three UAW members, claims the union’s FCA contract was skewed in the automaker’s favor by the corruption of two top negotiators and alleges millions of dollars in dues collected from union members were “wasted on tainted bargaining.”

The three plaintiffs sought class-action status for their lawsuit and recovery of union members’ dues. Several UAW members have contributed to a crowdfunding campaign to raise money for legal expenses.

(Former FCA executive gets 5.5 years in prison. Click Here for the story.)

Alphons Iacobelli, right, was found guilty for his role in the FCA-UAW training fund scandal, including paying off the mortgage of UAW VP General Holiefield, left.

At the time, former UAW President Dennis Williams said in a letter to UAW members posted on the union’s website that Iacobelli had “corrupted a few UAW officials because he needed their silence to protect his own crimes. Those were terrible acts on all sides. But the fact is those people’s misdeeds did not affect your collective bargaining agreement.”

FCA spokesman Michael Palese echoed Williams, saying, “The conduct as alleged had nothing whatsoever to do with the collective bargaining process between FCA US and the UAW.”

Federal prosecutors say Iacobelli paid out more than $4.5 million to union and company officials to influence collective-bargaining agreements between FCA and the UAW.

(Click Here for details about the Feds securing a new indictment in FCA-UAW scandal.)

In a plea agreement, Iacobelli admitted to paying off the $262,000 mortgage of Holiefield and his widow, Monica Morgan. The plea deal also states Iacobelli and others used FCA funds to pay union officials and employees more than $1.5 million in cash and goods to win contract concessions for the automaker.

UAW President Gary Jones said the FCA-UAW scandal was a failure of people, not the institution.

Iacobelli, who resigned from FCA just before contract negotiations began in 2015, was sentenced to five and a half years in prison for his part in the conspiracy, which revolved around stealing money from a joint FCA-UAW training fund for personal use.

Morgan, Holiefield’s widow, also is facing prison time on violations of federal tax law exposed by the federal investigation into the role played by her husband and her in converting the training funds to personal use.

(To see more about the UAW and FCA heading to court to retrieve stolen funds, Click Here.)

The investigation is continuing, according to federal authorities.

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