Did a Dealership do the Following?:

• Sell you a damaged car
• Sell you a defective car
• Lie to you about financing
• Lie to you about a warranty
• Lie to you about the history of a car
• Lie to you about the mechanical condition of the car
• Lie to you about the repair history
• Lie to you about the price
• Lie to you about the advertised price
• Use bait and switch advertising tactics
• Fail to return deposit
• Engage in deceptive practices
• Engage in consumer fraud
• Commit UDAP violations
• Misleading advertisements
• Misleading statements
• Consumer Lawyer

Sales Training

Most salesmen are trained either officially or unofficially. Many dealerships use third-party providers and send their salesman for training. Many dealerships simply train their salesman by using more experienced salespersons. However, there are some very specific tools that salesman use while selling vehicles. The old adage is true 1st you by the salesman then you buy the product. Salesmen do everything in an attempt to gain your trust. Once the gain your trust they can take advantage. You should not feel obligated to buy a vehicle just because you’ve been speaking to a salesman for a long period of time. You should not sign documents by vehicle just because you’ve been at the dealership for many hours and you need to go. There are some very simple tactics that salesman use. They attempt to divide spouses and keep their attention separate. They attempt to keep you there as long as possible and tire you out. They make it difficult for you to leave. Some of these things would include hiding your trade vehicle or making it difficult to get the keys. Every time you get up early have another offer or need you another any minutes. These role techniques and tactics the car salesman use to sell you vehicles and keep you at the dealership and to keep you confused. Because if you are thinking correctly most of the time you probably wouldn’t buy the vehicle.

Price Packing

The price packing is both a legal term and an industry term. The basic concept behind price packing is that the dealership will work you put on payments. This means that they will quote you certain payment based on what you’ve told them. Many times this payment is too high for the vehicle. This means as an example if you said you would pay $300 per month and the vehicle which you are looking at and it only costs $280 per month they put extra items and or raise the price and increase financing to go from $280 to $300 per month. This is commonly called a bump.

Vin Cloning and Odometer Fraud

Vin cloning is the use of fake vans to sell automobiles. This is not that common but is a tactic still used by many reputable individuals trying to make money by selling vehicles. What they do is salvage or get a van out of an auction or junkyard its clean. And the Venice put on a vehicle that is stolen or has many problems. Thus the Vin that you are looking at and either Carfax research appears clean when the car in fact itself might be stolen or have many other defects. Occasionally you will see a story on the news where a vehicle suddenly gets picked up by police that an individual has purchased despite the fact that the event has checked out as clear.

Vehicle History and Damaged Cars – Selling Damages Cars for Profit – Non Disclosures and Consumer Fraud

Misrepresentations as to the vehicle history is one of the most common claims for fraud and consumer fraud that I see on a daily basis. It is not a comment for a car dealership or salesman lie about the history of the vehicle in either a important or tangential manner. As an example they might say it has one owner when it in fact it had many. They might say it was driven by a little old lady one of fact they purchased at auction. The dealer might say that a representative of the dealership drove the car and use that as a demo, when in fact it had been used as a loner. This requires extensive diligence on an individual purchasing the car and make sure they write down all the representations and have the representative of the dealership whether it be the salesman or the finance manager to confirm in writing the promises. This way when later on down the road you discover that the representations were false you have an appropriate basis to make a claim which is easier than if you did not have these representations in writing.

New Jersey Does not Accept Buyer Beware

A dealer is required to know and understand the particular product that the dealer is selling. If a dealer is selling the car such as which is the case here the dealer is required obligated to understand exactly what the dealer selling.

New Jersey law is such that a person can rely upon the affirmative representations from the salesperson. New Jersey no longer accepts the term of buyer beware. New Jersey law requires a seller of goods to know what they were selling and if the seller of goods is going to represent what they are selling it is their obligation to make sure that those representations made by the employees of the dealership and the management of the dealership are truthful and accurate. It is not the customers obligation nor duty to figure out which is in which is not truthful, and exaggeration or otherwise. The dealership must be honest in fact and understand the product which you are selling and make sure that the product that they are selling is consistent with their explanations of the product. There is no blaming the victim here.

Credit Applications and Consumer Fraud

The salesman will have the consumer sign a blank credit application and place false information to have his or her credit approved. There are consumer and criminal laws covering this area. The dealer, or anyone for that matter, cannot place false information on a credit application to get a loan. Get copies of all credit application forms from both the lender and the finance company on your transaction. Information and changes in the credit application usually are the basis for many used car scams and consumer fraud.

Misleading Advertisements and Bait and Switch

Misleading advertising is a very ripe area for litigation and dealership abuse. Misleading advertising can occur in many different ways. Often, a dealership will advertise a vehicle which they might not have an inventory. The purpose is to lower potential customers to the dealership and have them purchase another vehicle. Another tactic that is available to dealerships is known as the golden hammer. The vehicle which is advertised might have damage or some other issue so when the customer gets there they disclose this and then they switch the customer into another vehicle. Another right area for litigation is advertised price. Frequently dealerships advertise a price on the website which is different than the posted price on the vehicle. This requires extreme customer diligence.

Deceptive Tactics – Misleading Customers Deceptive Tactics and Practices

Suing a car dealership can be a very difficult proposition from a litigation perspective. In many ways the auto industry is a very complex, moving organism. Industry practices both proper and improper or extensive and vary greatly from dealership to dealership. The software used to process transactions, run credit keep track of customers also can vary greatly. Management styles and techniques dealership sizes also vary greatly. All these factors go into analyzing a transaction to determine whether there has been an act of fraud and/or consumer fraud in analyzing dealer intent.

It is imperative to have an experienced attorney that has taken hundreds of depositions, litigated thousands of cases and is very familiar with the industry terminology and industry practices that can vary on the various transactions.

It is important to understand the management techniques, the software utilized, and the methods implemented by each dealership in each transaction to understand the dealership’s perspective and intent. Sometimes it appears that a dealership might have utilized deceptive practices however when analyzed closely they might have just been following software protocols about the processing of transactions.

However, generally, it is the individuals who have implemented these processes that are misleading and deceptive the need to be questioned, along with the processes which they have implemented. There are numerous techniques used by dealerships to process transactions, confuse customers for dealership profit. Not all dealerships are bad or deceptive however there are many that use deceptive practices to complete transactions in this industry. Some practices are not always deceptive or intended to be deceptive however from a consumer’s perspective and/or jury perspective the transaction was deceptive. It is the potential to deceive and misled or the capacity to deceive or mislead which is the important factor.

Sometimes it is not a matter of the dealerships good faith but the impact of the practices upon which they relied to sell vehicles is when the customer gets caught up in these potentially deceptive and misleading practices there is a cause of action or claim created against the dealer.

It is imperative in litigating cases in this industry to understand the common practices of deceptive and non-deceptive tactics that are potentially used by dealerships. Some of the tactics are clearly deceptive and some could be perceived as if they are deceptive. There is extensive fraud, including but not limited to the forging of signatures, submitting false information to financing sources and other deceptive and unconscionable business practices that occur to complete transactions that otherwise could not be completed without the implementation of deceptive practices.

Deceptive Tactic: Keep them in the ether.

There is a well-known deceptive tactic used in the auto industry which is known as keep them in the ether. What this means is that certain customers are so excited to own a new vehicle that they are not paying attention to the specifics of the transaction, so the dealership can process the transaction in any way they so desire because the customer was so excited he/she was not reviewing the documents, reading the documents or understanding the transaction. In a transaction such as this could be it could be extremely and solely to the customers detriment because the customer so excited.

The dealership is aware of this excitement and takes advantage of this excitement if allowed to do so. It is so common that dealerships actually have a term for it which suggests the customer so excited not aware of what’s going on or so numbed with excitement they are not aware as to what’s going on.

The dealership has actually created a term which suggests the customer is drugged and unaware then the dealership takes advantage of the perceived unaware customer to the customers detriment. It is not uncommon in these transactions for customer to pay a very high interest rate, purchase numerous items which are not necessary and overpay for either predelivery services are aftermarket items as part of the transaction to get a new car. It is not uncommon for customer such as this to review the paperwork after the fact when they get home after the excitement is worn off and get upset about the transaction.

Now a dealership calls this buyer’s remorse. This is a dealership term to refer to a customer who is changed his mind. In all actuality is a term which should reference a customer in which the excitement has worn off and looked at the specific terms and conditions of the transaction to notice that they have been taken advantage of when for which they were not aware. It should not be called buyer’s remorse, but it should be called the customer wakes up after the customer has been taken advantage of by the selling dealership.

It is hard to explain this concept however I have interviewed and spoken to hundreds if not thousands of individuals who have relayed this similar feeling being embarrassed that they have been taken advantage of by the selling dealership. The dealership is blaming the victim because the victim was an easy target. The term buyer’s remorse is, in my opinion, a derogatory term to refer to a customer and was been victimized by dealership tactics.

The fact that a dealership has a term for a customer having woken up and understood the transaction after the fact can be potentially indicative of the dealerships intent at the time of the transaction. So many clients come into my office and relate how they were so embarrassed that they were taken advantage of by the selling dealership on a particular transaction. Many clients do not understand that selling the car is an art. The sales technique which I have previously described is an art. Trained car salesman learned these tactics over the years and get an opportunity to perfect them. It is explained to potential clients that they were unaware that they had no chance to truly negotiate this transaction because of the dealerships experience in negotiating and superior knowledge of the industry.

This concept of sales technique and practices is a very difficult concept of understand. There is an entire industry which trains salespeople how to sell cars. Dealership salespeople are usually well trained and well-schooled in selling vehicles to customers and overcoming objections. Overcoming objections means that salespeople are taught how to talk people into purchasing vehicles who do not want vehicles. They call this overcoming objections. It is convincing people who are objecting to purchasing the vehicle or entering into a transaction into purchasing or entering into the transaction.

The particular tactic utilized in this example is but one of numerous tactics used by experienced, savvy, salespeople to sell vehicles to those who do not need, cannot qualify for financing, or are just not suited to get a new vehicle. An experienced salesperson will use these learned techniques and sales experience to sell a personal car who does not want or need a vehicle. And yes, we must recognize the concept of personal responsibility for customer who appears to have agreed to by the vehicle, however, this must be properly looked at in the context where a customer has no chance in negotiations with an experience car salesman.

Deceptive Tactic De Horse the customer – Take the trade vehicle away so the customer cannot leave the dealership.

This is another tactic/term of art used in the dealership business. This concept comes up when a customer has a vehicle which they intend to use as a trade vehicle and a new transaction. This new transaction can be a transaction in which the customer is either getting a used vehicle or a new vehicle, it does not matter in this circumstance.

So the dealership knows that the customer needs the trade vehicle. The conversation usually starts like this:

“okay sir, we need to evaluate the trade and have inspected can we please have the keys were going to have our used car manager review and appraise the vehicle.”

The key is what happens after the dealership has the key and has the vehicle in their possession. Under the circumstances a customer is now not allowed or permitted to leave the dealership with their vehicle. The dealership continues to tell the customer that the vehicle still being evaluated the vehicle still being looked at or they are still running it through the service department. The dealership might say that they are very busy, very crowded or the used car manager is a little busy. It is during this time that a dealer will continue to sell the transaction for any vehicle to an unsuspecting consumer or customer.

The customer might actually continually asked to have the vehicle returned because they are hungry and need to get something to eat. The customer might actually asked have the keys return to the vehicle. The dealership will continue to say okay were getting the keys okay you’re getting a vehicle back okay get something to eat or leave the dealership. However the punchline here is that the vehicle does not appear and the dealership continues to delay returning the vehicle and continue to negotiate the transaction.

The customer being unsuspecting and trusting except to the dealership statements that the vehicle still been inspected or whatever other excuse the dealership might use to convince a customer that the car is not available. Remember, each and every time a customer does not have the vehicle nor would leave the dealership with their vehicle dealership continues to negotiate. The dealer will use everything in our power to make sure that customer does not leave the dealership because once a customer leaves dealership is unlikely that customers ever coming back. It is not uncommon for clients who have visited my office to had the trade vehicle taken and not return for many hours. Many times customers will say that they just sign the documents together the dealership because they were hungry or the kids were running around. These are common statements made by potential consumer fraud victims.

Again, the dealership and the auto industry have actually created a term to suggest that once you get the customer out of the vehicle and into the dealership’s possession the dealership has complete control of when the customer can leave the dealership and has much time to negotiate a new transaction at the dealership so desires. This is a tremendous advantage in attempting to sell a customer a vehicle especially one who was very tired, very aggravated and need to vehicle. When the dealership has the customer’s vehicle the dealership is holding all the cards and came continued to delay returning the vehicle until the customer agrees to purchase a new vehicle to actually get out of the dealership.

Damaged Cars are Sold Every Day Without Anybody Knowing. Do not buy a Damaged Car. This is big Business

Do not let the Dealer lie to You About the History

Vehicles that have been damaged can be most lucrative for the dealer to sell. The position is obvious. The dealer can acquire a vehicle at low cost make some minor changes and resell the vehicle in excess of what the fair market value is for that particular vehicle. Freely the dealer might say that it is an irrelevant or tiny white lie however had the customer been made known aware of the defect with regard to the vehicle the transaction would not have occurred the same way. The law in New Jersey requires complete fair and honest disclosure if you think that the disclosure would make a difference in the customer’s purchasing decision. This would fall under the category of material in omission of fact. If you omit a material fact from a transaction you are responsible. If you mislead the customer you are responsible. The seller vehicle misrepresenting the history of vehicle or misrepresenting the condition of the vehicle you are liable under most circumstances.

New Jersey consumer laws are some of the strongest in the nation. They prohibit deceptive conduct. There is a large market in buying and selling damaged cars. There are entire auctions dedicated to selling damaged cars.

Insurance Auto Auctions sell thousands of damaged cars all over the country.

General Motors has an auction for GM dealers only, for many types of cars.

Car Tech Auction sells mostly damaged cars.

Selling damaged cars or cars with a negative history is one of the dirty little secrets of the automotive industry. There are certain resources for buying damaged or salvaged vehicles. Many of these auctions are only open to dealers or those who intend to resell the vehicles. The dealers who buy these vehicles from auction frequently fix them and resell them to third parties without disclosing that the vehicle has been in an automobile accident. The vehicle then moves through the stream of commerce and ultimately into the hands of an innocent consumer despite the fact that it has been in a serious automobile accident.

The law in New Jersey assumes that if the seller of a vehicle, a professional seller, makes a representation as to the condition of the vehicle being that it had one owner, that it was driven by a little old lady or that the vehicle was not in an accident, it is the seller’s responsibility to make sure that the representations associated with the sale of the vehicle were correct, proper and accurate. The law again assumes that the seller of the automobile is familiar with the regulations governing the industry and they have an obligation to make sure that the representations associated with the sale of the vehicle are correct.

As a practical matter, it is an industry standard to inspect a vehicle upon acquisition and prior to the sale, which is also known as PDI or pre-delivery inspection. It is during this pre-delivery inspection – which consists of an extensive inspection, usually with trained or skilled certified mechanics – that the dealership should be aware of any prior defects in the vehicle including, but not limited to, damage on the vehicle. It is a common practice in the industry for a dealer to use something called an elcometer wherein they measure the thickness of the paint to determine if the vehicle has been previously painted. If the vehicle has been previously painted, there is a “red flag” and they need to make further investigation to determine that the vehicle has not been in an accident despite the obvious signs of repairs.

Ultimately, the issue becomes: what is the reduction in value of the vehicle had the disclosure been made? Is there a separate market value for vehicles which have been damaged or involved with some type of negative history? As an example, is a negative history of a rent-a-car vehicle worthy of a deduction of market value price? Studies have shown that any negative history of an automobile, whether it be an accident, a rental or some other “negative event,” can potentially affect the market value of the vehicle.

Why would somebody pay market price when there is a reason to deduct from the market price? There are many guides to determine the nature and extent of the market value of any vehicles, such as the Kelly Bluebook and Galves. These books indicate that there is a reduction to the market value of the vehicle for the condition. However, these resources do not provide an appropriate or an exact percentage of reduction, but this number is attributable to the vehicles by experts such as those selling the vehicles, being the new and used car dealerships.

The New Jersey Consumer Fraud Act takes into account all of these considerations when such a case is being litigated. Ultimately, damaged cars or cars with negative histories are worth less and there is no reason that the consumer should pay full price for a vehicle which is not worthy of the market value. Is a vehicle with prior frame damage or repairs in excess of $5,000 equal to an identical or similar vehicle without the similar history? Absolutely not.

The selling of damaged cars is a rampant problem in the automotive industry, which continues on a daily basis. If you think your new or used car has been damaged, you should take appropriate legal action against the dealer.

Call us and let the New Jersey laws assist you in obtaining justice.

The New Jersey Consumer Fraud Act is applicable to those situations in which you acquire a vehicle and there was prior damage which was not disclosed. Many times, there is not any need to prove that the defendant intended to mislead the plaintiff. If the selling dealer makes a representation the potential customers allowed to rely thereon.

SEE CONSUMER BLOG FOR THE ANSWERS BELOW

• Can I sue the lender?
• Can I cancel a contract for purchase?
• Should I purchase a certified used car?
• Should I use Carfax?
• Do dealerships have a code of ethics?
• What are my rights when a new car is sold with damage?
• How do courts view the Consumer Fraud Act?
• What are some insider secrets of car salesmen?
• Should I file a complaint with the BBB?
• What are the top consumer complaints in New Jersey?
• Do car salesmen know if a car has been in an accident?
• Is there an entire market in buying and selling damaged cars?
• Do car dealers have disputes with their own employees?
• Where do I look for recalls on my car?
• What is my car worth?
• When can I get triple damages?
• What is the dealer liability for selling damaged cars?
• What is a sub-prime loan?
• Can I access any public records?
• Do car dealerships have a banking license?
• Ford Recalls.
• Dealership ethic requirements.
• Car salesman do have secrets.
• Car repair scams.
• Trial Lawyers for Public Justice.
• Do car salesman have code words?
• Does the dealer have insurance and does it cover my claim?
• Junk Fax Litigation
• Finance Fraud and Buying Cars.
• Can I sue if there is an as is clause?
• ECOA, Equal Credit Opportunity Act
• I Purchased a Damaged Certified Car? Can I sue the car dealership?
• Consumer Rights Lawyer in New Jersey
• Dealer Scam Selling Flood Damaged Cars
• Bait and Switch Advertising: Does there have to be a sale?
• False Advertising and selling cars in a deceptive manner
• Breach of warranty and warranty fraud

Consumer Fraud Complaints, Auto Dealership Fraud

The New Jersey Consumer Fraud Act’s prohibits defect deceptive acts and practices. We can bring consumer fraud actions against various business entities. The New Jersey Consumer Fraud Act applies to many industries including but not limited to the automotive sales industry. The reach of the New Jersey Consumer Fraud Act is excellent about this industry. It applies to various and specific part of the sales and servicing process.

•     Advertising – bait and switch
•     Service
•     Marketing
•     Credit
•     Finance
•     Damaged Cars
•     Pre delivery services
•     Aftermarket products
•     Salesman statements
•     Product condition
•     Warranty contents

Each of these products and the sales process behind these products are areas for litigation when and if a consumer has sustained an ascertainable loss associated with a deceptive practice. The basic requirement is that there must be a deceptive practice and affirmative misrepresentation or in other violation of the New Jersey Consumer Fraud Act associated with or related to an indirect fashion to an ascertainable loss sustained by consumer. In short:

•     Deceptive practice
•     Measurable Loss
•     Measurable Loss related to the practice

Very frequently in my experience a car dealership or an employee of the car dealership is involved in a deceptive practice. What a significant portion of my practice is related to car dealerships and the salesman this concept of deceptive acts and practices are not limited to the auto sales business. Recently you might have read significantly about Wells Fargo in the news about opening accounts in consumer’s name without the consumer’s consent. Again, in my opinion, this would be a violation of the New Jersey Consumer Fraud Act for which there would be recovery if the consumer sustains a measurable or ascertainable loss.  

There are other areas of litigation against finance companies including the fair credit reporting act and the fair debt collection practices act. While these are consumer laws resulting in consumer litigation is separate and apart from the New Jersey Consumer Fraud Act. However, just because you litigated a New Jersey Consumer Fraud Act claim would not bar you from litigating a claim under the fair credit reporting act or fair debt collection practices act. The remedies and rights under the New Jersey Consumer Fraud Act are in addition to, cumulative of the other rights guaranteed in either state or federal statutes.

In short, you are not limited to the New Jersey Consumer Fraud Act. You can Sue under the New Jersey Consumer Fraud Act in addition to those other federal or state statutes without any detriment to your claims. In fact, the law requires you to file all claims against all parties in one litigation. So, if you did not bring a specific claim in a certain litigation you would be barred from act claim if you wanted to re litigate that issue. The term is one bite of the apple. You get one bite of the defendants Apple. This is assuming everything is related to one transaction.

You need an experienced attorney to navigate the areas of consumer law in New Jersey and under the federal statutes. Various attorneys have a varying experience in certain areas of litigation. Jonathan Rudnick at Esq. has significant experience in litigating in the automotive industry against car dealerships. Not only is he represented consumers against car dealerships, but he has represented many salesmen a car dealership about salesmen and/or finance manager pay plan litigation. Pay plan litigation is asserting that the dealership failed to pay their employees properly in violation of a written or non-written pay plan. The concepts are the same.

The New Jersey Consumer Fraud Act and the consumer laws associated with the New Jersey Consumer Fraud Act are an excellent source of remedies for those who have been damaged.

Consumer Fraud Act plaintiffs filed suit against car dealerships for many types of claims. These claims include claims of prior damages. These claims include claims for selling salvage and rebuild vehicles. There are also lemon law claims however they are not consumer fraud claims but rather other statutory claims which may be categorized as breach of warranty claims. Lemon Law claims also provide for attorney’s fees for successful litigants. However, this is different than the Consumer Fraud Act because of these claims not triple damages. New Jersey Lemon Law claims a refund those who have purchased damaged vehicles.

The first step is to file a complaint. Plaintiffs filed and Superior Court and then served on the defendant. The defendant has 35 days to answer the complaint. The defendant as a corporation must hire a lawyer. The lawyer filed a complaint, affirmative defenses and jury demand. If there are any facts which are relevant in the answer, affirmative defenses or other items of the facts must be plead under various circumstances. The interest filed in Superior Court and Is provided the plaintiff or the plaintiff’s attorney.

Then discovery served on the defendant. Defendant can receive discovery with the complaint which is what I do in my office. The defendant then propounds discovery in the plaintiff and the discovery part of the case starts. There are then depositions and motions if a party deems them appropriate. These are all steps in most civil litigation cases however there are certain steps in Consumer Fraud Act cases and Lemon Law cases. One a case is filed, and interest filed with affirmative defenses and the case proceeds through litigation with discovery and date and depositions that that conducted down the road when the attorneys are involved

New Jersey law requires the jury demand to be filed with the complaint. The New Jersey Constitution guarantees a jury trial in civil and criminal cases. However, the court rules have set the procedure to determine the method by which a plaintiff must demand for jury trial. Generally, a jury demand is included in the initial pleading by the plaintiff. It is not uncommon for the defendant, dealership, also to include a jury demand. Jury demands can be waived but they must be waived by both parties. This would include an arbitration clause which the court deems as an agreement to waive a jury trial. This issue has been addressed previously in other portions of the website.