Apparently parent company DaimlerChrysler AG (DC) is so anxious to dump Chrysler (CC) that it has agreed to pay the buyer $1.55 billion to take over the ailing American auto giant. Last week we thought the Russians were coming. Now, we find out it's Wall Street blue suit types who look to be poised to take over at Chrysler.

The takeover deal requires the new owner, Cerberus Capital Management (CCM), to pony up more than $6 billion to beef up the bank account of the Chrysler operation, including its financing division, according to Reuters news. That's not to buy the corporation . . . that's just to make the accounting books look good.

To grease the skids on the deal, Daimler agreed to transfer $1.55 billion to the Chrysler bank accounts just so it can jump ship from its nine-year-old failed merger. They paid $36 billion to acquire Chrysler back in 1998.

In exchange, Cerberus Capital Management gets an 80.1 percent stake in a more solvent Chrysler business. Chrysler’s main union, the United Auto Workers, is cautiously giving a thumbs up to the proposal.

Chrysler Chief Executive Tom LaSorda said the deal would not trigger job cuts beyond the 13,000 the company announced in February, when it unveiled a $1.5 billion 2006 operating loss.

Reports are that out of Cerberus’ $7.4 billion commitment, $6.05 billion will be dumped into Chrysler — $5 billion into auto operations and $1.05 billion into its finance arm. Cerberus will also pay $1.35 billion to Daimler, which in turn is loaning $405 million to Chrysler.

DaimlerChrysler, a German company whose name will change to Daimler AG if shareholders approve, will contribute $880 million to cover long-term liabilities at Chrysler. It also agreed to transfer Chrysler’s Auto business free to debt, saying that would mean a net cash cost of $680 million from the sale.

Chrysler's brands, the Jeep and Dodge and Chrysler brand, will stay with Chrysler. The German company's premium brands, however, will stay with Daimler. That's Mercedes-Benz, the luxury Maybach and the Smart minicars.

Cerberus is a New York-based private investment fund that has become a big player in the hedge-fund business. Going back to a lesson learned a decade ago, they are reputed to have hired Wolfgang Bernhard to be an advisor on the deal. He's the guy who helped turn Chrysler around earlier this decade.

Okay, so DC pays money to get CCM to take over CC, and CCM pays DC most of that back, and then DC loans about a third of it back to CC. The whole thing sounds like a money mad merry go round dreamed up by lawyers and bankers who are probably getting paid a commission for creativity . . . but then again, that's what it sounded like nearly a decade ago when Daimler came on the scene in the first place.

So when you call up the 800 number for warranty help, I guess you'll get a blue suit that wants to sell you stock. The whole thing sounds like a shell game to me. If you get a lemon, and that's what it begins to sound like to you too, call us. We know what to do about it.

Burdge Law Office

www.UsLemonLawyers.com

Helping Consumers, and Consumer Law Attorneys, Since 1978

The Spin Masters are at it again. This time they're beating up on farmers.

US legislators are considering a bill that some in Congress have been trying to get passed for at least two years, but Big Business keeps blocking it. Co sponsored by Senators from Vermont, Wisconsin, South Dakota, Iowa, Nebraska and Illinois, where farmers matter big to the economy, you'd think that others would realize farmers could use some help and Senators from the farm states ought to know it.

The bill is called the Fair Contracts for Growers Act, S. 221, and it would provide for greater fairness in the arbitration process in to livestock and poultry contracts. What's so bad about that? The proposal seems fair. It would allow arbitration to be used resolve a dispute (as provided for under a livestock or poultry contract) only if, after the controversy arises, both parties consent in writing. It also would require the arbitrator to explain the facts and the law that made him or her decide the dispute the way they did.

So, if you're a very conservative congressman, getting lots of campaign donations from Big Business, what do you do to protect Big Business? Why, it's time for Amendments, of course!

"But we want it to sound like we're actually improving the bill," one says to the other. "No problem, let's call it the Fair Arbitration Act of 2007 'cause everyone likes something that's 'fair'," he answers back. And we're off to the spin doctors again...

Not to be outdone by reasonable efforts to protect the farmers, along comes Senators Kyl and Sessions who want to tack on amendments that would basically rip apart the original bill's intent to protect contract farmers from unfair (and often unnoticed) binding arbitration clauses.

Here's some of what the Give Me Back My Rights coalition have said about the anti-Fair Contracts bill's proposed amendments and why the so-called "Fair Arbitration Act" is really an unfair ripoff ...

- arbitration clauses are often buried in the fine print of a billing insert
- farmers, like consumers, have no real ability to bargain against Big Business interests
- legally required services (like car insurance and having a job) leave individuals with no choice about signing contracts on a take it or leave it basis
- powerful companies evade impartial scrutiny by courts
- consumer protection laws can be circumvented
- arbitrators are paid to make decisions by the people who favor arbitration and can unfairly become profit-driven in the very decisions they make
- the amendment's claimed procedureal "fix" (like getting a written explanation of the decision) end up having to be paid for by the requester at extra cost

Worse yet, Big Business actually has a bigger target in mind here ... they're going after all of your legal rights too!

This Big Business proposal would cover all kinds of arbitrations and would also basically create a "loser pays" change in the law for those who even dared go to court too. This is nothing short of a way to try to sneak in thru the back door some fundamental changes in our court system that they know we wouldn't let in thru the front door. Their changes would turn our court system upside down. Safeguards already exist in our court system to penalize abusive lawsuits but the court system wisely leaves it up to judges to decide whether or not a particular case has been abusive. Big Business wants would take that away from judges.

A friend of mine said he heard a judge telling a jury how important the right to trial by jury is for our system, how we declared our independence from England because they denied us the right to a jury trial, and how the Declaration of Independence and the Constitution both enshrined the right to a jury trial ... and how it made him wonder why people would give up such an important legal right and agree to a private secret "court" where no one would know what was going on. Well, folks, that's exactly what arbitration is all about.

Make no mistake about it. There's nothing at all fair about Big Business' so-called "Fair Arbitration Act". Write or email your congressional representative by clicking here and tell them, in plain english, "the Fair Arbitration Act is UNFAIR and I don't want it!"

Better yet, the Rural Advancement Foundation has created an easy-to-send letter that you can use. Please take the easy step of clicking the link below and (modify) and send the letter they've created:


Farmers are the backbone of this country and they need all of our help to fight back against Big Agribusiness. Some of the worst stories of arbitration abuse come from honest rural farmers who are just trying to make a living and raise their family.