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Authenticom CDK Lawsuit Update

Discussion in 'CDK Global DMS (formerly ADP Dealer Services)' started by 1to1News, Jul 15, 2017.

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    Some good news received yesterday...

    LA CROSSE, Wisc., July 14, 2017
    - Today a federal court granted Authenticom, Inc.'s motion for a preliminary injunction against CDK Global ("CDK") and The Reynolds and Reynolds Company ("Reynolds"). The Court held that CDK and Reynolds must "cease blocking Authenticom" from providing "data integration services to dealers who authorize Authenticom to provide this service." In so ruling, the Court held that Authenticom had satisfied each element for granting a preliminary injunction, including demonstrating that CDK and Reynolds have likely violated federal antitrust laws. The Court gave the parties one week to submit proposed language effectuating the Court's ruling.

    "The Court's ruling today is an important step forward not only for Authenticom, but for the automotive industry as a whole. Authenticom can now meet the data integration needs of both dealers and vendors without the threat of Authenticom's dealer-authorized data access being blocked," said Authenticom CEO Steve Cottrell. "We look forward to providing secure, cost-effective, and reliable data integration services to our existing and future customers, finally without the threat of being hindered by CDK's and Reynolds' anticompetitive conduct."

    On May 2, 2017, Authenticom filed an antitrust lawsuit against CDK and Reynolds in federal court in the Western District of Wisconsin. Then on May 18, 2017, Authenticom filed a motion for a preliminary injunction, seeking an order enjoining CDK and Reynolds from blocking Authenticom's dealer-authorized data integration services. An evidentiary hearing was held before the Court on June 26-28, 2017, during which executives from Authenticom, CDK, Reynolds, vendors, and dealers testified. Expert witnesses on data security and antitrust economics also testified.

    In today's ruling, the Court held that there is sufficient evidence to find "the existence of a per se illegal horizontal conspiracy" between CDK and Reynolds to divide the data integration market and block competitors like Authenticom. The Court also found that CDK's and Reynolds' contracts with dealers and vendors contain provisions that are likely to be found unlawful in restricting free competition in the data integration market.

    "We look forward to competing with CDK and Reynolds on a level playing field," Mr. Cottrell stated. Authenticom's DealerVault service allows dealers to have complete control and transparency over how their data is used by vendors. DealerVault also helps vendors and dealers keep their costs down with standardized pricing for vendors of $25 per month for a single nightly data feed or $50 per month for two or more nightly data feeds - a fraction of the cost charged by CDK and Reynolds. DealerVault's security protections are gold standard, using Microsoft's most secure cloud-based solution, Azure. DealerVault has been an overwhelming industry choice, enrolling over 8,000 dealerships as well as over 400 vendors on its platform in only the past two years.
     
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