Car Fraud Plaintiffs Entitled to Net Worth Discovery in Consumer Fraud Cases Seeking Punitive Damages

Plaintiff seeks damages from Defendants under the Illinois Consumer Fraud and Deceptive Business Practices Act, including punitive damages, which are expressly recoverable under the Act. 815 ILCS 505/10a.

Illinois courts mandate allowing for punitive damages net-worth-related discovery, when, such damages are available as a matter of law. In Pickering v. Owens-Corning Fiberglas Corp., 265 Ill. App. 3d 806, 823-24 (5th Dist. 1994), the Court stated:

It is well settled that evidence of a defendant’s net worth and pecuniary position may be introduced in a case in which punitive damages is an issue (citation omitted). No Illinois case, of which we are aware, limits the scope of financial discovery relating to punitive damages.

Similarly, in Cripe v. Leiter, 291 Ill.App.3d 155, 160 (3d Dist. 1997), the Appellate Court affirmed a contempt order against a Defendant who had argued that his personal income tax returns were not discoverable because they were inadmissible and irrelevant.

Net worth evidence is discoverable and may be admitted at trial to set punitive damages commensurate with a defendant’s wealth so that it is sufficient to adequately punish it. Tague v. Molitor Motor Co., 139 Ill. App. 3d 313, 318 (5th Dist. 1985) ($17,000 in punitive damages arising from $1,000 in actual damages was justified due to defendant’s net worth). The financial status of the defendant is important and relevant because an amount sufficient to punish one individual may be trivial to another. The amount of the award “should send a message loud enough to be heard but not so loud as to deafen the listener.” Dubey v. Pub. Storage, Inc., 395 Ill. App. 3d 342, 359, 918 N.E.2d 265, 281–82 (1st Dist. 2009). For that reason, a “plaintiff seeking punitive damages is entitled to engage in discovery relating to the defendant’s financial worth in advance of trial.” N. Dakota Fair Hous. Council, Inc. v. Allen, 298 F. Supp. 2d 897, 899 (D.N.D. 2004).

And Illinois courts have routinely approved punitive damage awards in car fraud cases involving the sale of rebuilt wrecks. The Court in Ciampi v. Ogden Chrysler Plymouth, Inc., 262 Ill. App. 3d 94, 113 (2nd Dist. 1994) held:

We conclude that punitive damages were appropriate, given Ogden [Chrysler’s] reckless disregard of Ciampi’s rights. … [T]he amount of punitive damages is not excessive. Relevant circumstances in reviewing an award of punitive damages include, among other things, the nature and the enormity of the wrong, the financial status of the defendant  … As to the nature and enormity of the wrong, Ogden’s statements were clearly intended to induce Ciampi to purchase the LeBaron at a price considerably more than the car’s worth. Ciampi paid even more for the LeBaron than the manufacturer’s suggested retail price for the vehicle without 13,000 miles of usage. We conclude that the award of $100,000 [in punitive damages with a $5,000 actual damage award] is both appropriate and proportionate to the nature and the enormity of the wrong.

See also Gehrett v. Chrysler Corp., 379 Ill.App.3d 162, 179 (2nd Dist. 2008) ($59,695.79 punitive damage award for dealer misrepresenting vehicle as having “Quadra–Trac on-demand-four-wheel-drive system”, where plaintiff obtained $8,500 in actual damages); Totz v. Cont’l Du Page Acura, 236 Ill.App.3d 891, 904 (2nd Dist. 1992) ($5,000 in punitive damages for concealing rebuilt wreck with $400 in actual damages); Crowder v. Bob Oberling Enterprises Inc., 148 Ill.App.3d 313, 318–19 (4th Dist. 1986) ($9,000 in punitive damages for hidden accident and frame damage imposed on top of a $5,500 actual damages award).

It is obvious that using fraudulent means to knowingly or recklessly sell a rebuilt wreck that is unsafe to drive and is a public safety hazard warrants entry of a large punitive damages award. As the Court in Crowder held, concealing the accident history of a used car is exactly the type of misconduct that calls for a punitive damages award:

Our review of the record thus far illustrates clearly the egregious scheme of deceit and fraud perpetrated by [car salesmen] Oberling and Fierge against plaintiff and against the public generally. Their false representations and omissions of material fact were made wantonly and by design. The trial court acted wisely in recognizing this to be a proper case in which to award punitive damages in order to punish Oberling and Fierge and to deter others from similar conduct.  Id. at 318–19.

See also Twyman v. S&M Auto Brokers, 16 C 4182, 2016 WL 6082357, at *3 (N.D. Ill. Oct. 18, 2016) (fraudulent sale of a rebuilt wreck in violation of the ICFA could result in a substantial punitive damages award and thus the potential for such damages meets the $75,000 threshold needed to create federal diversity jurisdiction.)

In sum, Plaintiff are entitled to obtain the requested net worth discovery in connection with his request for punitive damages under the Consumer Fraud Act.

Our law firm concentrates in car dealer and automobile dealer fraud cases.  If you were deceived into purchasing a rebuilt wreck or flood car or SUV call us for a free consultation at 630-333-0333.

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