Class Action Victory for Subaru of New England, Inc.
BOSTON (December 22, 2004) — On December 16, 2004, the United States Court of Appeals for the First Circuit ruled in favor of McDermott Will & Emery client Subaru of New England, Inc. (SNE) in George Lussier Enterprises, Inc. v. Subaru of New England, Inc., upholding the legality of its practices in selling automobile accessories to its dealers.
The decision affirms the decision of Chief Judge Paul Barbadoro of the U.S. District Court for the District of New Hampshire, which held that Subaru’s practices did not violate federal or state laws. The class action lawsuit was filed in 1999 on behalf of a class of present and former New England Subaru dealers against SNE and its owner, the late Ernest Boch. Dealers alleged that SNE controlled the vehicle allocation process to coerce them into purchasing unwanted accessories on new Subaru automobiles, claiming that this alleged practice violated federal antitrust and RICO statutes, federal and state dealer laws and state contract law.
In affirming the entry of summary judgment for defendants, the Court of Appeals held that SNE’s alleged practice of conditioning access to cars outside the dealers’ allocations on the purchase of accessories did not constitute unlawful coercion or extortion because the dealers had no entitlement to the additional cars.
The McDermott team representing SNE and Mr. Boch was led by Boston partner Steven W. Kasten and included Scott Murray.
