MARTINSVILLE, Ind. — A bill that would undermine class-action lawsuits leveled against two Indiana dealers this month awaits the signature or veto of Gov. Eric Holcomb after passing both houses of the state legislature. Indiana also permits a bill to become law seven days after being signed by state senate and assembly leaders if the governor takes no action; both had done so as of Monday, Apr. 15.
State Sen. Aaron Freeman, a Republican from Indianapolis, is one of HB 1237’s sponsors. He introduced an amendment intended to codify a “gentleman’s agreement” dealers struck with the office of Indiana Attorney General Curtis Hill, RTV6 reports. The understanding, as reflected in the amendment’s language, is that document preparation fees should not exceed $200.
This month, attorney Vess Miller of Indianapolis law firm Cohen & Malad filed two class-action lawsuits on behalf of customers of Butler Toyota of Indianapolis and the 11-rooftop Andy Mohr Automotive Group. The suit claims $169 and $199 doc fees charged by Butler Toyota and various Andy Mohr dealerships, respectively, violated the Indiana Deceptive Consumer Sales Act, which limits such fees to “expenses actually incurred.”
“Right now, dealers are limited to what the actual cost of the document is, which is a few bucks,” Miller told RTV6. “What the new law is going to do is say you can charge up to 200 bucks. It’s a $200 tax that’s going directly into the pockets of the dealers for doing nothing but filling in a few pages of forms.”
In response, State Sen. Freeman said, “The state requires the dealers to do a lot of paperwork. They can now do BMV stuff — prepare the titles and get all that stuff to the appropriate places. There’s a lot of moving parts here and quite a bit of work that dealers have to do when a car is purchased.”
Freeman’s amendment would make the new official standard retroactive to July 1, 2013, a condition to which Miller objects.
“It’s like I got caught speeding — I was going 50 in a 30,” the attorney said. “And instead of going in and paying my ticket, I go to the legislature and I say, ‘Change the speed limit where I was speeding, and make it apply in the past, as if it never happened.’”
Indiana has been a hotbed of dealer regulatory action so far this year. On April 2, the attorney general’s office reached an $88,000 settlement with Grover Auto Sales, a buy-here, pay-here dealership accused of failing to deliver vehicle titles. The following week, Hill charged a Texas company with deceptive advertising in Indiana dealership mailers after winning a $140,000 judgment for similar charges against an unrelated Texas marketer in January.
Originally posted on F&I and Showroom