Supreme Court Ends Block on Fiat-Chrysler Deal
By wchung | 07 May, 2025

The Supreme Court on Tuesday cleared the way for Chrysler LLC’s sale to Fiat, turning down a last-ditch appeal by opponents that included consumer groups and three Indiana pension plans.

The court rejected a plea to block the sale of most of Chrysler’s assets to the Italian automaker. Chrysler, Fiat and the Obama administration had warned that the high court’s intervention could have scuttled the sale.

A federal appeals court in New York had earlier approved the sale, but gave opponents until Monday afternoon to try to get the Supreme Court to intervene.

Justice Ruth Bader Ginsburg ordered a temporary delay just before a 4 p.m. deadline on Monday. A little more than 24 hours later, the court freed the automakers to complete their deal.

The opponents include a trio of Indiana pension plans, consumer groups and individuals with product-related lawsuits.

The court issued a brief, unsigned opinion explaining its action. To obtain a delay, or stay, someone must show that at least four of the nine justices find that the issue raised is serious enough to warrant hearing a full appeal and that a majority of the court will conclude the lower court decision was wrong.

“The applicants have not carried that burden,” the court said.

Indiana Treasurer Richard Mourdock expressed disappointment with the decision and said options seem limited for opponents of the sale. “Obviously the supreme court of the land is the supreme court of the land,” Mourdock said. “The United States government has, I continue to believe, acted egregiously by taking away the traditional rights held by secured creditors.”

The White House issued a statement applauding the decision: “The Chrysler-Fiat alliance can now go forward, allowing Chrysler to re-emerge as a competitive and viable automaker.”

The challenge was filed by the Indiana pension funds and other investors who claimed the sale unfairly favored Chrysler’s unsecured stakeholders ahead of secured debtholders like themselves.

Chrysler has been working to complete the sale of its assets to Fiat before a June 15 deadline, a key element in its restructuring plans.

Early Tuesday, the pension plans seized on comments from Fiat officials that they would not walk away from the deal even if June 15 were to pass without completing the sale. The plans tried to persuade the justices that there was no reason to rush to meet that deadline.

But Chrysler, Fiat and the Obama administration stressed in response that Chrysler was losing $100 million a day and that the deal automatically terminates in less than a week, with no guarantee that a new agreement would be reached.

The court did not consider the merits of the opponents’ arguments, only whether to hear their full-blown appeal.

Also on Tuesday, Chrysler returned to bankruptcy court to get approval to terminate 789 dealer franchises.

More than 25 attorneys representing hundreds of dealers from across the country opposed Chrysler’s request, arguing that little would be gained by ending the franchises. The company said the move was a necessary part of its plan to cut costs and quickly emerge from Chapter 11 bankruptcy.

Many of the dealers were selling the last cars on their lots and preparing to shut their doors for good at the end of the day, while others planned to sell used cars or other brands after severing ties with Chrysler.

6/9/2009 8:33 PM MARK SHERMAN Associated Press Writer WASHINGTON