In the past week, the attorney general’s offices in Florida and Washington have filed complaints accusing car dealers of making advertising and promotional claims that run afoul of consumer protection laws (Florida press release and Washington press release).
On October 22, the Washington State Attorney General’s office filed a Complaint against RGH Marketing, Inc., and the general manager of Interstate Auto Liquidators, alleging that their claims of selling repossessed or bank-owned cars when, in fact, the cars were coming from their regular inventory or from auto auctions, violated Washington’s consumer protection laws. The Complaint also accuses defendants of misleading consumers by using the term “$0 Down Delivers!” in its advertising. The lawsuit seeks a permanent injunction against defendants as well as restitution for aggrieved consumers.
Meanwhile, on Monday of this week, the State of Florida Attorney General’s office announced that it had filed a Complaint against Hollywood Auto Gallery, Inc., and related companies, accusing them of unfair trade practices by claiming the cars they were selling were under warranty when, in fact, the warranty was only good for a maximum of $500 in repairs. According to consumer complaints, the cars sold by defendants were in such bad condition that they would often break down shortly after they left the dealership. The lawsuit seeks injunctive relief prohibiting defendants from selling used cars; restitution on behalf of victimized consumers; and civil penalties.
These actions are the latest chapter in what has been a long history of state attorney general’s cracking-down on car dealers who engage in deceptive trade practices. Since 2007, attorney general’s offices across the country, including those in New York, Illinois and Massachusetts, have filed actions against car dealerships for false and deceptive advertising practices. These actions have involved:
- a dealership in New York persistently using misleading sweepstakes promotions to lure consumers into its dealership;
- an Illinois dealership misleading consumers with false promises to repay loans on trade-in vehicles; and
- a Massachusetts dealership using misleading advertising by prominently advertising a price with an asterisk and, in small print at the bottom of the ad, indicating that the ad price presumes that the consumer will provide a certain amount of money in cash or trade.
