Mahindra denies fraud allegations by US dealers

Mahindra will have to face a mass lawsuit which was filed on June 4, 2012 in the District Court of Atlanta by automobile dealers across the US market. US dealers claim they were duped by Mahindra of more than $60 million in cash and trade secrets, according to a PRNewswire release. Mahindra denies these allegations.

The dealers apparently say that Mahindra did not deliver the utility vehicles including the Scorpio-based pick-up trucks as promised. And further, the dealers stated in the lawsuit that they had invested in setting up showrooms and incurred marketing expenses and apart from this, Mahindra had allegedly collected $9.5 million in fees from them.

Mahindra has refuted the allegations of the US dealers. “Mahindra unequivocally denies all allegations of fraud, misrepresentation and conspiracy,” says a company statement. It added that some US dealers had earlier filed a suit against them in a District Court in Missouri and the court dismissed all claims against Mahindra in that suit.

In February 2011, Global vehicles, the distributor of Mahindra utility vehicles dropped the case against the Indian utility vehicle maker for retaining the import rights to distribute Mahindra pick-ups in the US. And now, for the second time, the issue has cropped up with dealers filing a lawsuit against Mahindra.