AKRON-A U.S. appeals court has revived a $3.5 billion lawsuit against Goodyear claiming the Akron tire maker engaged in trade libel and racketeering activities in dealings with a Chinese business venture.
The 9th U.S. Circuit Court of Appeals decided in October that a 1995 suit filed by Hong Kong-based China Tire Holdings Ltd. against Goodyear should return to the U.S. District Court in Los Angeles where it originated.
The district court had dismissed the case on summary judgment in September 1999, but China Tire and its U.S. distributor, Orion Tire Corp., appealed the decision.
In overturning the district court ruling, the three-judge appeals panel said the case shouldn't be dismissed on its face with prejudice.
The legal action stems from Goodyear's 1994 establishment of a joint venture in Dalian, China, with the state-owned Dalian General Rubber Factory. The suit alleges the U.S. firm unlawfully persuaded Dalian officials to abandon a binding contract with China Tire to manufacture radial tires in China and other international locations.
The lawsuit claims Goodyear made false and disparaging statements about China Tire executives and gave jewelry, clothes, travel and employment contracts to Dalian factory officials to persuade the firm to cut ties with China Tire.
The actions violate trade libel laws, the Foreign Corrupt Practices Act and the Racketeer Influenced and Corrupt Organizations Act, the suit claims.
``We're disappointed with the 9th Circuit's decision,'' a Goodyear spokesman said. ``We intend to vigorously defend our case back at the district court level. We will demonstrate again that these charges are totally without merit.''