Tekion, a cloud-native automotive retail platform, has initiated a federal antitrust litigation against CDK Global. The lawsuit accused CDK of utilizing anticompetitive strategies to preserve its market dominance in the franchise dealer management system (DMS) marketplace. The CEO of Tekion, Jay Vijayan, emphasized that CDK's technology is archaic and that the company is allegedly abusing its position to obstruct competition. This includes concealing customer data to prevent the transition to alternative platforms. Fenwick & West LLP filed a lawsuit on behalf of Tekion, which seeks an injunction and damages. The injunction mandates that data transfers be completed within ten days of dealership requests.
CDK has faced scrutiny for similar practices in the past. In 2024, a Georgia court compelled CDK to transfer dealership data to Tekion. CDK also paid $100 million in a class-action lawsuit alleging price inflation in the DMS sector. The company's resistance to Arizona’s DMS law, which promotes third-party access to dealership data, was ultimately overruled in the Ninth U.S. Circuit Court of Appeals. Tekion, launched in 2016, has aimed to revolutionize the automotive retail industry with its Automotive Retail Cloud and cutting-edge technologies like AI and IoT, driving innovation in a sector that has seen minimal disruption for decades.
