Automotive tech company CDK must face antitrust class action, judge says

A federal judge in Chicago has said that software vendors can bring a joint lawsuit against automotive technology supplier CDK Global in connection with data access restrictions and overcharge estimates of several hundred million of dollars. Several other industry vendors subsequently joined AutoLoop’s 2018 suit against CDK in Illinois when its Chief US District Judge, Rebecca Pallmeyer certified the suit as a class action.

The lawsuit alleges that CDK violated antitrust laws and engaged in conduct that restricted competition. The vendors, led by AutoLoop, want some USD 395 million in damages from CDK, an Austin, Texas-based company that offers software solutions for dealerships to handle sales, financing and automotive service operations. The plaintiff class includes owners and operators of dealer-management system applications for inventory control, repair orders, warranty services, and other functions. As it was described, CDK limited the access to systems of dealers that increased the costs of necessary data for vendors such as AutoLoop for their applications.

By Wednesday, neither CDK, AutoLoop, nor their attorneys had replied to emails and phone calls for an interview. Currently there is no decision made by the court on whether to certify the dealers as a nationwide class.

In preparation for a trial that Judge Pallmeyer has instructed should occur in Wisconsin where the case originated before being consolidated in Illinois, there is no set trial date. Despite that, CDK has never been found to engage in any wrongdoing at any phase of the litigation process.

The class action includes 244 software vendors that have bought data integration services from CDK or its competitor Reynolds & Reynolds since October 2013. Reynolds & Reynolds does not act as a defendant in this case; however, it paid nearly USD 30 million in 2018 to car dealers over similar claims. While this paper was being written, Reynolds & Reynolds had not responded to the following comment requests:

CDK had traced its opposition against the class certification arguing that there was inadequate evidence to show that all the vendors had been affected.