The high Canadian dollar has demonstrated the difference between prices here and the same goods in the U.S. And now that gap may help a case wind up in court. A Toronto law firm has filed a $2 billion class action lawsuit against North American auto manufacturers, claiming they jacked up the price of new cars to discourage Canadians from buying an automobile across the border.
The suit covers anyone who bought a new car between August 2005 and August 2007 and names Honda, Nissan, Chrysler and the troubled GM in both Canada and the U.S., which is still reeling from the effects of a newly settled
UAW strike. Both the
Canadian Automobile Dealers Association and the
National Automobile Dealers Association, a U.S. partner based in Virginia, are also cited.
Class action suits all have one thing in common - they need to have someone fronting them. In this case, the plaintiffs are four Toronto residents who claim the industry conspired to keep them from getting a better deal. They contend the automakers had a tacit pact not to honour warranties bought down south, a situation that forced consumers who wanted that coverage to pay 25 to 35 per cent more on average for a vehicle sold here.
None of the allegations have been proven in court and the case may never actually reach there. The suits need to be certified by a judge, who has to find justifiable grounds to allow them to proceed. If they get that far, they are often settled beforehand for lesser amounts before actually going to court.
For more information on the firm handling the suit,
click here.
What is a class action lawsuit?
Chevrolet products built by General Motors sit on a car dealership September 26, 2007 in Chicago, Illinois. (Photo by Scott Olson/Getty Images)