Former Manitoba politician and aboriginal leader Elijah Harper has filed a lawsuit against a Winnipeg auto finance company over an advertisement that aims to sell automobiles to people receiving compensation as a result of residential school abuse.

In a statement of claim filed May 7 in Court of Queen's Bench, Harper alleges White Buffalo Auto Finance and Autowest Inc. published a defamatory ad in the February edition of Windspeaker, a national aboriginal news magazine.

In the ad, an image and likeness of Harper urged people to call the White Buffalo auto sales team for a fair price and courteous service, the statement of claim says.

The ad goes on to offer a special service to people expecting a residential school settlement cheque, the court document says.

The ad said the company had developed a special auto-buyer's plan that, the claim quotes, "allows you to get into the auto of your choice now rather than wait for your settlement cheque."

As a result of the publication, the claim says, Harper has suffered damages through the abuse of his name, reputation and standing in the aboriginal community.

The ad seriously undermines Harper's work related to residential schools, the claim charges.

The lawsuit seeks general and punitive damages, as well as costs.

The allegations in the statement of claim have not been proven in court. White Buffalo Auto Finance and Autowest Inc. has 20 days to respond.

The defendants did not return calls from the CBC. 

Harper came to national prominence as a Manitoba MLA who, in 1990, refused to accept the Meech Lake Accord. He now works in Ottawa as an aboriginal activist and lobbyist.

Under the residential school settlement approved by the courts earlier this year, the federal government will make about $2 billion in "common experience" payments to the roughly 78,000 aboriginal people still living who attended the schools during the 20th century.

People who were sexually or physically abused while they attended the schools, which were typically run by churches, will receive more compensation.

In total, the compensation deal is worth $4 billion to $5 billion, according to court documents. Payments could begin by October, barring future legal challenges.