Articles Posted in Auto Fraud

While buying a used car might sound like a great way to save money, a new investigation allegedly found that buying from AutoNation could mean the possibility of buying a car that AutoNation knows is defective (or is subject to recall) but never bothered to have repaired or to resolve the recall issue.

There is a federal law that prevents auto dealers from selling new defective automobiles, but there is no such law to prevent anyone from selling used cars with defects. A new federal bill was recently introduced that would close that loophole, but we have yet to see what the fate of that bill will be. In the meantime, some states have local laws against selling defective vehicles (new or otherwise), so if you live in a state with such protections and you recently bought a defective used car, you can sue the dealer that sold you the defective vehicle. Continue reading ›

A purchaser of a classic 1973 Ford Bronco sued the car’s auctioneer in Illinois court. The purchaser alleged that the vendor committed fraud by misrepresenting the condition of the vehicle in its advertisements and during the auction. The circuit court dismissed the case for lack of personal jurisdiction. The Illinois Appellate Court reversed, finding that the vendor had sufficient contacts with Illinois when it solicited the business of the purchaser via advertisements, its website, and its communications over email and the phone.

In January 2018, John Dixon saw an advertisement posted by GAA Classic Cars, LLC on a car-related website. The advertisement listed a 1973 Ford Bronco for sale at auction. Dixon responded to the advertisement by sending an email to GAA requesting more information about the Bronco including how to bid for it. GAA responded with an email to Dixon, inviting Dixon to bid on the Bronco at the auction scheduled for March 2, 2018. GAA’s email told Dixon that he could participate via live simulcast bidding or on the telephone via phone bidding. GAA added that Dixon could find more information about the Bronco at GAA’s website. Dixon asked for pictures of the Bronco’s engine. GAA responded by email that it would send him pictures of the engine once GAA received the Bronco from its owner. GAA told Dixon that the auction price for the Bronco should run around $30,000.00 – $40,000.00. Continue reading ›

A couple purchased an RV from a retailer in 2014. The RV came with a warranty from the manufacturer that limited the warranties to one year from the date of purchase. The warranty required that the purchasers notify the manufacturer or an authorized dealer within five days of discovering any defect. The purchasers experienced continual problems with the RV over the time that they owned it. The RV was repaired multiple times, but the service technicians were never able to fully resolve the defects. The purchasers asked the manufacturer to repurchase the RV from them. When the manufacturer refused, the purchasers sued, claiming the manufacturer breached its warranties. The district court granted summary judgment to the manufacturer. The appellate panel affirmed, finding that the purchasers had not given the manufacturer enough chances under Indiana law to cure the defects with the RV.

Vanessa and Randy Mathews purchased a Holiday Rambler Presidential RV in May 2014 from Mellott Brothers Trailer Sales, Inc. The RV came with a warranty from the manufacturer, REV Recreation Group. The warranty limited both express and implied warranties to one year from the purchase date. To take advantage of the warranty, the Mathews had to notify REV or an authorized dealer within five days of discovering a defect.

The Mathews alleged that they encountered problems with the RV almost as soon as they drove it off the lot. They called the dealership to report that there were issues with the interior lights, the refrigerator, and the leveling system. A month later, the Mathews encountered further difficulty: the converter was blowing fuses, the leveling jacks worked only intermittently, the curbside slide cable broke, and there were problems with the TV and the DVD player. After calling the dealer again, the Mathews were given the number for REV so that they could locate an authorized repair center. Continue reading ›

Our Chicago auto fraud firm filed an amicus brief in the Illinois Supreme Court on the side of an RV purchaser who wanted to revoke acceptance due to a leaky roof and the inability to use the RV all summer even though it is a summer product. The lower court had ruled against the RV purchasers holding that had to provide an opportunity to cure before revoking acceptance. The Illinois Supreme Court disagreed and held there was no right to cure for a defective product and the seller should have permitted revocation of acceptance. You can read the entire opinion Chicago auto fraud attorneys. Continue reading ›

A manufacturer of yachts was sued by a disgruntled buyer for breach of contract after the yacht he ordered was not usable in waters in the European Union as he originally specified. The buyer lost in court, however, because he argued that the yacht was a total loss, and the company presented evidence that the conversion to allow the yacht to operate in Europe would cost less than $2,000, and that it had repaired other small defects for free.

Porter, Inc. is an Indiana company that manufactures boats under the Formula and Thunderbird trade names. In September 2012, Erich Schwaiger attended a boat show in Friedrichshafen, Germany, and met Alfred Zurhausen, the owner of Poker-Run-Boats, one of Porter’s international dealers of Formula boats. Schwaiger expressed interest in ordering a Formula yacht with supercharged engines and high-end accessories and furnishings. Zurhausen later met Schwaiger in Munich to discuss the options and pricing in more detail. Schwaiger later, through one of his companies, SelectSun, executed a contract with Poker-Run-Boats in October 2012. The yacht and custom-built lift cost Schwaiger approximately $1 million.

The contract required that the boat be CE certified, so that it would be authorized for operation in the European Union. Porter did not, however, manufacture the boat to meet that specification due to a miscommunication during the ordering process that Porter had with one of its domestic dealers, International Nautic. Schwaiger took delivery of the yacht in Germany in May 2013. He used the boat throughout much of the 2013 season in Europe. During the first few months, Porter covered a series of minor warranty repairs at no charge to Schwaiger. By the end of August, however, Schwaiger was fed up with the yacht, complaining to Poker-Run-Boats of problems with the boat’s engines, steering column, exterior gel coating, and interior furnishings. Schwaiger then returned the yacht to Poker-Run-Boats with instructions to sell it. When the boat did not immediately sell, Schwaiger sued. Continue reading ›

Ford started installing a new dual-clutch transmission (referred to as the DPS6 transmission) in its Focus and Fiesta models back in 2010 and as many as 1.5 million of the allegedly defective vehicles remain on the road today. The new transmission allowed the cars to reach 40 mpg, but according to recent allegations, Ford failed to properly test the new transmission before putting it out on the road, where it allegedly failed and put customers in danger.

As if that wasn’t bad enough, Ford allegedly ignored warnings from internal engineers and lawyers before putting the cars on the market, at which point the car company allegedly proceeded to ignore complaints from customers for more than five years.

According to complaints, the new transmission allegedly did everything from losing power on highways for no apparent reason to shoot into intersections without warning. Instead of issuing a recall, Ford allegedly gave its dealers talking points that included telling them the cars were operating normally when that was far from the truth.

The financial result of all this doesn’t look good for Ford. The company has had to spend hundreds of millions of dollars in repair costs, many of which didn’t actually fix the cars. In addition to having to litigate lawsuits from thousands of consumers, Ford has also lost a significant amount of business from many loyal fans who now say they will never buy another Ford. Combine that with word of mouth reports of the dangerous cars it let on the road, plus bad press, and it will be difficult for the company to recover financially from this mess. In fact, the company recently warned its investors that litigation over the new DPS6 transmissions poses a financial threat. According to an internal report by Ford, the total costs related to the new transmission could reach $3 billion by the end of next year. Continue reading ›

Our Chicago car fraud lawyers have been litigating for many years claims against car and truck manufacturers who decline to stand behind certified pre-owned (CPO”) vehicles that turn out to be rebuilt wrecks or flood vehicles. We recently beat back a motion to dismiss by General Motors in such a case. General Motors claimed that the Texas GMC dealer who sold our client the truck at issue was a necessary party to the case and that since General Motors hadn’t sold our client the truck it should be suing General Motors.  You can read the court decision here which rejected General Motors argument.

Super Lawyers named Chicago business dispute lawyers Peter Lubin a Super Lawyer and Patrick Austermuehle a Rising Star in the Categories of Class Action, Business Litigation, and Consumer Rights Litigation. Lubin Austermuehle’s Chicago auto fraud lawyers near Oak Brook and Naperville have over thirty years of experience in litigating auto fraud, franchise and dealer termination, breach of contract, complex class action, copyright, partnership, and shareholder oppression suits, non-compete agreement, trademark and libel suits, consumer rights and many different types of business and commercial litigation disputes.  Our Vernon Hills and Wheaton car fraud attorneys near Chicago litigate CPO fraud cases and rebuilt wreck and flood vehicle cases against used car dealers and automobile manufacturers. We also assist Chicago, Evanston and Oak Brook area used car consumers who are victims of fraud and consumer fraud. You can contact us by calling (630) 333-0333 or our toll-free number (833) 306-4933.  You can also contact us online here.

Buying cars that are “certified pre-owned” (CPO) has long been a way for consumers to get a car they know they can rely upon without having to pay the high prices associated with cars that come right off the lot. Because CPO models tend to go for a lower price than brand new cars, Volkswagen Group of America and Audi of America allegedly decided to sell pre-production models of some of their cars and label them “CPO,” according to a new consumer lawsuit. The proposed class action alleges the cars that were sold to American buyers did not meet U.S. motor vehicle regulations, meaning they posed a safety risk to American consumers.

Michael J. Melkersen is an attorney who filed the lawsuit on behalf of consumers in the states of Colorado, New Jersey, and Washington. Motley Rice LLC is also providing representation for consumers in this proposed class action lawsuit, which has been filed in the U.S. District Court for the Eastern District of Virginia. Melkersen said in a statement that, in addition to allegedly committing fraud by selling vehicles that had not passed U.S. safety regulations, the two car companies and their German parent companies had allegedly furthered their misconduct by trying to cover it up when they allegedly lied about the mileage on the vehicles, including allegedly using a secret data feed, which it sent to Carfax so it would show a misleading report of the car’s mileage. Continue reading ›

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