NYC Sues Used Car Dealers For False Advertising And Other Deceptive Practices

FK
Frankfurt Kurnit Klein & Selz

Contributor

Frankfurt Kurnit provides high quality legal services to clients in many industries and disciplines worldwide. With leading practices in entertainment, advertising, IP, technology, litigation, corporate, estate planning, charitable organizations, professional responsibility and other areas — Frankfurt Kurnit helps clients face challenging legal issues and meet their goals with efficient solutions.
Here are a few take-aways from the DCWP's action.
United States Media, Telecoms, IT, Entertainment

The New York City Department of Consumer and Worker Protection sued two used car dealers, along with their owners, alleging that they engaged in false advertising and other deceptive and unlawful trade practices.  The DCWP is seeking more than $200,000 in restitution, civil penalties, and the suspension or revocation of the dealers' licenses.  

The DCWP alleged that Champion Auto Sales advertised low prices for used cars, but then refused to honor those prices when consumers showed up at the dealer.  The DCWP also alleged that Prestige Motor Sales advertised cars at low prices "while concealing in fine print that the displayed price is after a $3,000 down payment."  Iin addition, the DCWP alleged that the dealers engaged in a variety of other illegal sales practices as well.

In what should be a cautionary tale to anyone who is responding to subpoenas or other discovery requests, the DCWP also alleged that Champion modified advertisements before submitting them to DCWP "to make it appear as if each car's advertised price was higher than the price for which Champion sold the automobile."  In addition, the DCWP alleged that Prestige attempted to hide its deceptive practices by not producing the documents that DCWP had requested by subpoena. 

Here are a few take-aways from the DCWP's action.  First, the DCWP has the authority to prosecute advertisers for false advertising.  So, as we have previously written about, it's important to keep New York City's rules in mind when advertising there.  Second, don't be accused of engaging in a bait-and-switch.  If you advertise that a product is available for a price, make sure that the product is available for that price.  Third, don't hide the important details in fine print.  If there's important information that consumers need to know, those details must be clearly and conspicuously disclosed in the advertising. 

www.fkks.com

This alert provides general coverage of its subject area. We provide it with the understanding that Frankfurt Kurnit Klein & Selz is not engaged herein in rendering legal advice, and shall not be liable for any damages resulting from any error, inaccuracy, or omission. Our attorneys practice law only in jurisdictions in which they are properly authorized to do so. We do not seek to represent clients in other jurisdictions.

See More Popular Content From

Mondaq uses cookies on this website. By using our website you agree to our use of cookies as set out in our Privacy Policy.

Learn More