The Supreme Court has let stand a decision generally barring foreign car manufacturers from forcing franchised U.S. dealers to buy replacement parts exclusively from them.
The court, without comment, rejected an appeal Monday by Mercedes-Benz of North America Inc. that had been supported by other foreign and domestic car makers.The 4th U.S. Circuit Court of Appeals ruled last September that Mercedes violated antitrust restrictions on tie-in arrangements by requiring franchised dealers to use "genuine Mercedes-Benz parts" when servicing customers' cars.
The appeals court rejected Mercedes' argument that a 1936 Supreme Court ruling granted car manufacturers an exemption from antitrust enforcement for tie-in arrangements.
The appeals court also ordered a new trial to determine how much money Mercedes must pay in damages to Metrix Warehouse Inc., an independent auto parts distributor.
A federal jury had ordered Mercedes to pay Metrix $7 million in damages. The figure was based on $2.3 million in losses Metrix said it suffered from 1977 through 1983, with the figure tripled under a provision of antitrust law.
A judge overturned the jury award on grounds some of the money Metrix claimed it lost may have been the result of lawful competition and not illegal tie-in arrangements.
Mercedes, which sold some 90,000 cars in the United States in 1987, said its 1 percent share of the U.S. market depends on guarantees of high quality.
Requiring franchised dealers to buy parts from the manufacturer is essential to assuring that quality, Mercedes said.