Printer Friendly

ENVIROTEST SUES TO VOID MINNESOTA CONTRACT WITH GENERAL MOTORS SUBSIDIARY

 ENVIROTEST SUES TO VOID MINNESOTA CONTRACT
 WITH GENERAL MOTORS SUBSIDIARY


GM, Largest Auto Manufacturer, Testing Auto Emissions in Violation of
 State Law; Similar Conflicts Noted in Six Other States
 MINNEAPOLIS, Dec. 12 /PRNewswire/ -- Envirotest Systems Corp. has filed suit against the Minnesota Pollution Control Agency, General Motors Corporation, Electronic Data Systems, Systems Control Inc., and Systems Control Vehicle Testing Inc. (Systems Control) citing a conflict of interest in Systems Control's contract to test auto emissions in Minnesota. The suit was filed in the District Court, Fourth Judicial District, State of Minnesota.
 In the suit, Envirotest asks the court to nullify a contract between the State of Minnesota and Systems Control, a General Motors subsidiary, for the operation of motor vehicle public inspection stations in Minnesota. The suit is based on the state law and the contract, both of which contain strong conflict of interest provisions requiring that "the contractor and its officers and employees may not be engaged in the business of selling, maintaining or repairing motor vehicles or selling motor vehicle replacement parts." In 1988, Minnesota passed a law requiring inspection of motor vehicles for air pollution emissions.
 In August 1991, General Motors became the sole owner of Systems Control, the contractor of the Minnesota vehicle testing program. Through this ownership, General Motors now has access to extensive data relating to competitor products and the likely market for repair. The suit alleges that Systems Control failed to notify the Minnesota Pollution Control Agency of its purchase by General Motors, and that the agency was not aware of this event until advised by Envirotest.
 Envirotest, through its wholly owned subsidiary Hamilton Test Systems, manufactures, sells, operates and services fixed lane centralized automotive emission and safety programs. Hamilton was the number two bidder in the competition for the Minnesota emissions testing contract.
 Chester Davenport, chairman of Envirotest said, "It is surprising to me that for the last four months General Motors has been allowed to own and operate a company that tests automobile emissions, in blatant violation of both Minnesota law and the state's contract. A company that makes cars cannot test cars. Doing so gives General Motors an unfair business advantage by allowing it to get information about competitors, and about the market for repairs. More important, citizens will rightfully distrust a GM test, undermining public confidence in the testing program. This blatant conflict of interest cannot be allowed to continue."
 Davenport added that the conflict of interest is not limited to Minnesota. General Motors is also testing cars in Florida, which has a similar law. The Florida State Comptroller has ordered an investigation. In addition to Minnesota and Florida, General Motors is also testing cars in Maryland, Illinois and Washington State. In these five states alone, they test 25,000 cars each day. They also test cars in Alaska, and audit independent testers for the State of California.
 "It seems strange that the largest manufacturer of automobiles owns the largest auto emissions testing company, which determines whether their own cars, and their competitors' cars, meet federally mandated emissions standards. There's something wrong with that," Davenport said.
 Specifically, the suit asks the court to require the Minnesota Pollution Control Agency to:
 -- Immediately terminate the state's contract with Systems Control;
 -- Make no further payments to Systems Control and require a rebate of payments since the GM purchase;
 -- Require under the terms of its contract with the state, that Systems Control sell the test stations to the state so that the state may resell them to a new contractor;
 -- Demand that Systems Control provide necessary transition training services to a new contractor to continue operation of the testing program without interruption; and
 -- Award the contract to the second highest bidder in the initial bidding process.
 The suit further asks the court to require Systems Control to:
 -- Return to the State Treasury all payments received since the date of the acquisition by General Motors;
 -- Sell its testing station to the state; and
 -- Provide any necessary transition services.
 NOTE: Chester Davenport is available for interviews. Copies of the Minnesota District Court filing against PCA, General Motors, and others, is available by calling Susan Eich or Tim Loesch at 612-851-1600 or Fred Garcia or Anne Fierro at 212-953-2550.
 -0- 12/12/91
 /CONTACT: Susan Eich or Tim Loesch of Tunheim Santrizos, 612-851-1600 or Fred Garcia or Anne Fierro of Clark & Weinstock, 212-953-2550/ CO: Envirotest Systems Corp.; Minnesota Pollution Control Agency;
 General Motors; Electronic Data Systems; Systems Control ST: Minnesota IN: SU:


DS -- MN002 -- 2182 12/12/91 18:05 EST
COPYRIGHT 1991 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Dec 12, 1991
Words:755
Previous Article:ARRDA CALIFORNIA TIMESHARE DEVELOPERS CALL SPECIAL MEETING; TASK FORCE ASSIGNED TO MONITOR GLEN IVY INVESTIGATION
Next Article:WORLD BOXING CHAMPION MAKES HIS COMEBACK ON UNIVISION'S PANORAMA DEPORTIVO
Topics:


Related Articles
ENVIROTEST PETITIONS STATE OF MAINE TO VOID CONTRACT WITH SNAP-ON/SCI; CITES SCI'S FALSIFICATIONS OF BID DOCUMENTS & CONFLICT OF INTEREST
ENVIROTEST ANNOUNCES SETTLEMENT OF LITIGATION
PENNSYLVANIA'S AUTO EMISSION CONTRACTOR SELECTED
COLORADO SELECTS ENVIROTEST FOR THE STATE'S AUTO EMISSIONS TESTING CONTRACT
ENVIROTEST RESPONDS TO CAMPAIGN OF MISINFORMATION IN CONNECTICUT
HAZLETON TO HOST NEW AUTO EMISSIONS TEST CENTER
ENVIROTEST AND COMMONWEALTH OF PENNSYLVANIA START FORMAL NEGOTIATIONS IN EFFORT TO RESOLVE CONTRACT CLAIMS
PENNSYLVANIA GOV. RIDGE SIGNS BILL TO IMPLEMENT ENVIROTEST SETTLEMENT
ENVIROTEST SYSTEMS CORP. REPORTS SECOND QUARTER RESULTS
Envirotest Selected By Virginia For Vehicle Emission Testing Program

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters