Auto tech firm CDK reaches $630 million settlement in US dealer data case (updated)

Brookfield Business Partners LP

28/01/2025 22:15

(Adds statement from CDK in paragraph 7)
    By Mike Scarcella
       Jan 28 (Reuters) - Automotive technology giant CDK
Global has agreed to pay $630 million to settle antitrust claims
that it caused hundreds of software vendors to overpay for
vehicle dealership data by restricting access.
    The proposed settlement, filed on Monday night in a federal
court in Madison, Wisconsin, requires a judge's approval.
    The company denied any wrongdoing in agreeing to settle.
    Austin, Texas-based CDK, owned by Brookfield Business
Partners  BBU.N , sells software platforms auto dealers use to
run their daily sales, financing and service operations. 
    Tech vendor AutoLoop and other companies included in the
settlement create apps for the dealers' management systems for
inventory management, repair orders, warranty services and other
functions.
    AutoLoop sued CDK in 2018, accusing it of cutting off access
to auto dealer systems and driving up prices vendors pay to
access data for their apps. A judge certified the case as a
class action in July.
    CDK chief executive Brian MacDonald said in a statement the
company "felt it was time to bring this long-standing litigation
to a conclusion" and that the settlement would have no impact on
its business.
    The vendors had indicated they would seek damages of $490
million at a trial previously scheduled for this week. A jury
award could have been tripled under antitrust law.
    The vendors who brought the class action include 243
companies that purchased data integration services since October
2013 from CDK or one of its rivals, Reynolds & Reynolds, which
is not a defendant.
    Lawyers for AutoLoop and other members of the class action
at Kellogg, Hansen, Todd, Figel & Frederick called the
settlement "extraordinary" in a statement and said it stemmed
from "years of hard-fought litigation." They said they would ask
the court for about $200 million in legal fees.
    CDK agreed to pay $100 million in August to settle a class
action by U.S. auto dealerships claiming they overpaid for the
company’s dealer management systems.

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Automotive tech company CDK sued by rival Tekion over dealer
systems    https://www.reuters.com/legal/litigation/automotive-tech-company-cdk-sued-by-rival-tekion-over-dealer-systems-2024-12-10/
Auto tech company CDK settles dealers’ antitrust lawsuit for
$100 mln    https://www.reuters.com/legal/litigation/auto-tech-company-cdk-settles-dealers-antitrust-lawsuit-100-mln-2024-08-16/
Automotive tech company CDK must face antitrust class action,
judge says    https://www.reuters.com/legal/transactional/automotive-tech-company-cdk-must-face-antitrust-class-action-judge-says-2024-07-24/
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 (Reporting by Mike Scarcella; Editing by Emelia
Sithole-Matarise and Stephen Coates)
 ((Mike.Scarcella@thomsonreuters.com;))