CDK Global settled a lawsuit and agreed to pay dealerships more than $100 million
Dealers across the U.S. were crippled by a computer outage earlier this year at services provider CDK Global. The outage was caused by a ransomware attack that bricked computers and left dealerships unable to sell cars or offer certain services. The aftermath of the outage is now the least of CDK Global’s worries, as it’s now facing a multi-million-dollar bill following an antitrust lawsuit that was filed against the company.
Way back in 2017, CDK Global was accused of inflating dealership management system prices in order to “stifle competition,” reports Automotive News. Now, the company has settled the lawsuit out of court and agreed to pay the dealerships that filed the case more than $100 million. As Automotive News explains:
“It’s a good day for dealers,” said Leonard Bellavia of Bellavia Blatt in Mineola, N.Y., one of the attorneys representing the dealership plaintiffs in the lawsuit. “It shows how dealers can collaborate and collectively seek redress on a nationwide scale by joining forces and working together.”
The settlement, if approved by a judge, resolves the dealership class-action lawsuit filed against CDK and rival Reynolds and Reynolds Co. in 2017 accusing both companies of federal and state antitrust violations. It also cuts off an expected September trial in U.S. District Court for the Northern District of Illinois. DMS market leader CDK, which also is paying up to $250,000 for “notice and claims administration” costs, said it was glad to move ahead from the long legal dispute.
The deal will put this case to rest, but does nothing to prevent further litigation being brought against the company following the outage experienced by dealers earlier this year. In fact, Automotive News reports that “any lawsuits stemming from the June 19 cyberattacks against CDK also are not affected” by this week’s settlement.
Lawsuits brought against CDK following the attack include one that accuses the company of not doing enough to protect private personal details during the hack.
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