New York, NY – On October 19, 2017, Bellavia Blatt, P.C. (“Bellavia Blatt”) and co-counsel Milberg Tadler Phillips Grossman LLP (“Milberg Tadler”) launched a nationwide class action accusing CDK Global, LLC (“CDK”) and The Reynolds and Reynolds Company (“Reynolds”) of federal and state antitrust violations, seeking damages and injunctive relief for a class of automobile dealers. The class action alleges a conspiracy between CDK and Reynolds for the purpose of reducing competition and raising prices in two specific areas: (1) the market for the provision of data management system (“DMS”) software to franchised dealers; (2) the market for data integration services relating to utilizing the data housed on data management systems. Numerous dealership cases were subsequently filed nationwide. These cases, along with other cases brought by vendors serving dealerships, were consolidated in the U.S. District Court for the Northern District of Illinois (Chicago) by the United States Judicial Panel on Multidistrict Litigation.
The first action on behalf of auto dealerships was filed by Bellavia Blatt and Milberg Tadler and alleged that, as a result of their illegal agreements and anticompetitive conduct, CDK and Reynolds have been able to effectively control the data integration market. For example, it is alleged that they impose exorbitant charges on the previously mentioned third-party vendors who require access to information in order to provide services to dealers for everything from inventory and customer relationship management, to electronic vehicle registration and titling. It is alleged that, in the end, those charges are passed along to the dealers. Furthermore, the suit alleges that this anticompetitive conduct was designed to – and, in fact, did – artificially inflate the price of DMS services and the cost of engaging third-party data integrators. As a result, it is alleged that dealers have been forced to pay supra-competitive prices for both.
On April 16, 2018, after considering competing motions from various firms, the Honorable Amy J. St. Eve appointed Leonard A. Bellavia of Bellavia Blatt to the Plaintiffs’ Dealers Steering Committee and Peggy J. Wedgworth of the Bellavia Blatt and Milberg Tadler team as sole Interim Lead Class Counsel for the dealerships. Mr. Bellavia noted, “Having devoted my decades-long legal practice to representing dealerships, we will fight for dealers against oppressive pricing and business practices of these DMS providers in this litigation.”
Bellavia Blatt is a leading firm representing automobile dealerships nationwide in a variety of transactional matters and litigations.
If you wish to discuss this matter with us, please contact the following:
Director of Special Projects
Bellavia Blatt, P.C.
200 Old Country Road – Suite 400
Mineola, New York 11501