Ally Says Santander Stole Trade Secrets for Chrysler Job

A joint venture of a Banco Santander SA (SAN) unit and Chrysler Group LLC was accused in a lawsuit by Ally Financial Inc. of violating a copyright on loan forms to avoid a $150 million accounting penalty.

Ally sued Santander Consumer USA Inc., claiming copyright infringement and misappropriation of trade secrets. Ally asked a federal court in Detroit to prevent the venture, Chrysler Capital, from “imitating, copying or making use of” the copyrighted forms.

Santander “elected to take a short cut rather than do the hard work that was required to develop the comprehensive, foundational auto finance platform needed to service the Chrysler dealerships and consumers on the scale contemplated by, and contracted with, Chrysler,” Ally said in the complaint filed Sept. 13 in federal court in Detroit.

Ally claims that a former employee hired by Santander “took several proprietary documents when he left Ally,” including the company’s “Retail Procedures Manual.” Ally, the Detroit-based auto lender, is seeking to repay a U.S. bailout of $17.2 billion.

Chrysler Capital, which began operating May 1, finances car and light-truck purchases and provides dealers with wholesale loans for buying vehicles from the manufacturer. Chrysler allowed its agreement with Ally to expire at the end of April.

Michael Palese, a Chrysler Group spokesman, declined to comment on the lawsuit. Laurie Kight, a spokeswoman for Santander Consumer USA, didn’t immediately return a voice-mail message yesterday seeking comment on the complaint.

The case is Ally Financial Inc. (ALLY) v. Santander Consumer USA Inc., 13-cv-13929, U.S. District Court, Eastern District of Michigan (Detroit).

To contact the reporters on this story: Margaret Cronin Fisk in Detroit at mcfisk@bloomberg.net; Mark Clothier in Southfield, Michigan at mclothier@bloomberg.net

To contact the editors responsible for this story: Michael Hytha at mhytha@bloomberg.net; Jamie Butters at jbutters@bloomberg.net

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