Car Dealer Lawyer

This is a special Halloween.  Once a year we are supposed to celebrate all that is dark, mysterious and frightening in our world.  This year, the economy has done that for us already.  For dealers, Halloween is usually the last day of a tough month where there is little or no possibility of a big sales push on the last day.  This month, it will be especially difficult.

Nevertheless, Halloween calls for horror stories (or “haar” stories as we say here), and today’s comes from Florida.  According to the St. Petersburg Times, Ernie Haire Ford in Tampa, Florida was ordered to pay $6.9 million to resolve a class-action suit.  What did Ernie Haire Ford do?  According to the lead plaintiff, it charged $199 for etch that she didn’t request.  She also claimed that there were other things in her contract that had been “concealed” in her sales contract, such as rust-proofing, paint sealant, and fabric protection.  Hmm - does this sound familiar to anyone?

The plaintiff’s lawyers are having a happy Halloween because they were awarded $3 million in attorneys’ fees and $431,700 for expenses.  (If I lived in Florida, I would have my kids trick or treating at their houses - but they probably have gates.)  

The frightening part of any class action case is the large numbers involved.  When a standard practice of a dealership is successfully challenged, the damages can be huge.  Etch, doc fees, and other disclosure issues create huge exposures.  

The other thing that this case shows is how important it is to have good insurance coverage.  According to the general manager’s comments in the article, it seems that Ernie Haire Ford’s insurance had assumed the defense of this case and was responsible for the settlement.  Dealers should all read their insurance policies carefully to make sure that they would be covered in cases like this.  Happy Halloween!

Source:  St. Petersburg Times