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Dealer Count in Carfax Antitrust Suit Reaches 530

March 11, 2014

By Brittany-Marie Swanson

MINEOLA, N.Y. — As of Feb. 25, the number of dealer plaintiffs listed in the federal antitrust lawsuit against Carfax has reached 530. The firm of Bellavia Blatt Andron & Crossettfiled the lawsuit last April on behalf of 124 dealerships. According to Senior Partner Leonard Bellavia, new plaintiffs are being added every day.

“The lawsuit is a result of my receiving numerous complaints from dealers that we represent about their relationship with Carfax,” Bellavia told F&I and Showroom. “And that stems from the fact that dealers seem to be frustrated over the lack of reliability of the CARFAX report and how it put them in very awkward position with their own customers.”

The lawsuit charges Carfax with impairing competition by entering into agreements with vehicle merchandizing sites like Autotrader.com and Cars.com, and with OEMs and their certified pre-owned programs, then asking them “not to recognize vehicle history reports from anyone other than CARFAX.”

“The net result is, every place the dealer turns, he finds himself handcuffed into using Carfax,” Bellavia said. “Because Carfax has no competition, its reports are substandard, its prices are excessive to dealers and it enables them to employ a market strategy that disparages its own customer base.”

In the past, dealers have attacked the company’s advertising tactics for vilifying them and painting them as untrustworthy. Bellevia added that the company’s prices are inflated to nearly five times the fair market value when compared to at least nine other providers of vehicle history reports.

“Competition does two things: It keeps prices in check and it requires that your product be state of the art,” he said.  

The firm is still in the process of resolving preliminary motions in the case. Bellevia said the lawsuit should enter the discovery phase within the next three months.

Comments

  1. 1. Marc Ray [ March 12, 2014 @ 04:19PM ]

    Carfax has done a good job branding their product and made it very easy to sell vehicles and give consumers confidence in what they are purchasing. If you look at the big picture and transparency in sales, is the newspaper over charging so we have to sue them now?

  2. 2. Cactus Jack [ March 12, 2014 @ 04:40PM ]

    The Autocheck reports are close enough to carfax at 80% less. Carfax is a monopoly and they should be stopped.

  3. 3. Cactus Jack [ March 12, 2014 @ 04:42PM ]

    Carfax is basically a monopoly. Autocheck icost me 80% less than carfax and is almost as good. I canceled my carfax and will not use it again until things change.

  4. 4. TAK [ March 12, 2014 @ 04:51PM ]

    I wish we could use Autocheck, their fees are lower. They don't offer reports on the kind of commercial trucks we sell. Hey Autocheck, get with it!

  5. 5. Bob [ March 12, 2014 @ 05:01PM ]

    What I do not like is their pricing. Over 100$ per month plus a per-car fee. This is for a service that should cost cents to run each vehicle. We only pay around $2 for a credit report. We tell customers right out carfax is overpriced and we do not use it, they are welcome to spend their own $40 and get that information if they want.

  6. 6. Tom Truluck [ March 13, 2014 @ 08:30AM ]

    No one is forced to use carfax, dealers use it as a sales tool even though everyone knows it often supplies incomplete information. The fact is that the automobile industry and the sales tactics that have been employed are the reason that dealers are forced to use carfax. The fact is that the consumer doesn't trust auto dealers period. Pricing is not handled fairly, it never has been. Dealers continually prey on the uninformed and gouge anyone seeking repair work. I find it unforgivable that dealer service shops often know less about my car (which they sold to me) than I do. Their shops are set up to maximize income for the dealership. Having to return a car two or three times for the same repair is unacceptable. If dealers are unhappy, so what, you are only reaping what you have sown.

  7. 7. brandon cretacci [ March 14, 2014 @ 08:12AM ]

    I would look into Autocheck also as for they get reports from auctions and even if there is a mark on the frame from transport tie downs they will say frame damage which decreases value on vehicles when they are a little too extreme.

 

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