Maryland Car Dealer Settles With FTCFebruary 15, 2016
One of the nation’s largest used car dealers has agreed to settle with the Federal Trade Commission over allegations that they failed to disclose important safety information regarding used cars for sale. The complaint named Jim Koons Automotive Companies, which has 19 dealerships in the mid-Atlantic region, including five locations in the Baltimore area. The FTC accused the dealerships of advertising cars that were subject to open and unrepaired recalls, all while touting their vigorous quality inspection process.
The complaint alleged that some of the cars advertised on the dealerships’ website were subject to open recalls for auto defects that could cause serious injury. Defects included faulty ignition switches that can affect engine power, power steering, braking and airbag deployment, thereby increasing the risk of a crash and injury to occupants. At least one certified used vehicle had an open recall for issues related to the alternator, which can cause the vehicle to unexpectedly shut down or cause an electrical fire. Another advertised vehicle had a rear suspension defect that could result in a fuel leak or fire.
The FTC filed similar complaints against General Motors Company and Lithia Motors Inc., an Oregon-based dealer with more than 100 stores in the West and Midwest. Both companies also agreed to settle the complaints. Under the agreements, the companies are prohibited from claiming that their used vehicles are safe or have been subject to a rigorous inspection unless they are free of unrepaired safety recalls. If an unrepaired recall exists, the companies must clearly disclose that fact in close proximity with the inspection claims. Prior to the ruling, the only way a customer could uncover any information about open recalls for safety issues through the dealers website was to locate the Carfax link on the vehicle listing page and click on it to access the vehicle history report. However, the FTC alleges that, on numerous occasions, even these reports failed to reveal information about open safety recalls.
The agreement, which will remain in effect for the next 20 years, prohibits the dealers from misrepresenting any facts about the safety of the used cars they advertise. The FTC has also ordered the companies to inform recent buyers, by mail, that their vehicle may have an open recall. The order will apply to Jim Koons buyers who purchased their vehicles between July 1, 2013 and June 15, 2015.
Maryland Car Accident Lawyers at LeViness, Tolzman & Hamilton Represent Those Who Have Been Affected by False Advertising
Car buyers have a right to know whether the vehicle they are purchasing has been recalled for safety issues. If you or a loved one has been injured in a car accident caused by a defective auto part, call our Maryland product liability lawyers at LeViness, Tolzman & Hamilton today to discuss your legal options. A qualified member of our legal team is available 24 hours a day by calling 800-547-4LAW (4529) or you can contact us online.
Our offices are located in Baltimore, Columbia, Glen Burnie and Towson, allowing us to represent victims of defective auto parts throughout Maryland, including those in Anne Arundel County, Carroll County, Harford County, Howard County, Montgomery County, Maryland’s Western Counties, Southern Maryland and the Eastern Shore, as well as the communities of Catonsville, Essex, Halethorpe, Middle River, Rosedale, Gwynn Oak, Brooklandville, Dundalk, Pikesville, Parkville, Nottingham, Windsor Mill, Lutherville, Timonium, Sparrows Point, Ridgewood and Elkridge.