Consumer Groups Challenge Freeing Chrysler From Product Liability Claims

Consumer groups said Tuesday they filed a U.S. Supreme Court appeal challenging Chrysler LLC’s sale on the grounds the deal would leave the automaker free of current and future product liability claims.

Five consumer groups and three individuals with pending cases challenged a provision of the sale agreement that releases the new company from pending and future product liability claims involving vehicles sold before the new company’s creation.

The consumer groups asked the U.S. Supreme Court over the weekend to put the sale of the bankrupt automaker to a group led by Italian carmaker Fiat SpA on hold while they appeal.

U.S. Supreme Court Justice Ruth Bader Ginsburg late on Monday granted a separate request to delay Chrysler’s sale. That request was made by Indiana pension funds and raised different issues than the arguments by the consumer groups.

But the Supreme Court Tuesday cleared the way for the U.S. government-backed sale of Chrysler LLC.

(Reporting by James Vicini, Editing by Leslie Gevirtz)