Judge gives dealers' fraud suit against Mahindra the go-ahead

Automotive News is reporting that a US District Court has ruled that a lawsuit by five dealers against Mahindra & Mahindra can move ahead. The Indian automaker had moved to have the case dismissed, but District Judge Thomas Thrash in Atlanta said the plaintiffs presented enough evidence for "a reasonable person to infer that Mahindra USA was involved in a plan to deceive the dealers." The group alleges that they were defrauded by the manufacturer when Mahindra said it planned to create a new brand of light trucks in the US. It's the latest in a long line of misfortunes for the automaker in the US market.

Mahindra spent some four years working with Global Vehicles USA, a private US distributor just outside of Atlanta. At one point, Global Vehicles boasted a dealer network of some 350 retailers ready to sell small, Indian-made diesel pickups in the States. Mahindra promised more products would follow after the utilitarian four-wheel drives, but a spate of delays quickly derailed that plan. The distribution deal wound up dead by 2010, leaving many dealers with empty showrooms and pockets. While a US District Court in Missouri dismissed one case against Mahindra on the grounds that the distribution deal was with Global Vehicles and not the Indian automaker, the current suit seems ready to move forward.