Top News

Judge Allows Antitrust Lawsuit Against CARFAX to Proceed

October 1, 2014

MINEOLA, N.Y. — This week, A federal judge denied a motion filed by CARFAX to dismiss a $350 million antitrust lawsuit brought against the provider of vehicle history reports by more than 750 dealerships. The case, filed by Bellavia Blat on behalf of the dealers in April 2013, is being heard in the U.S. District Court for the Southern District of New York.

With the ruling, the case is now headed into the discovery phase. The lawsuit alleges that Carfax has forged illegal alliances with key players in the auto industry, freezing out competition and forcing dealers to pay higher prices for unreliable vehicle history reports. The suit notes that Carfax then uses its inflated revenues on ads that disparage dealers as dishonest.

“This recent decision is a substantial victory for the dealers, as the court held that we have asserted legally cognizable claims under the various antitrust laws,” said Bellavia Blatt Senior Partner Leonard A. Bellavia, which is seeking substantial money damages per dealership and an injunction against the alleged illegal conduct. “This is an important initiative to redress wrongs being committed against both dealers and consumers.”

Carfax declined to comment on the federal court's decision.

Comments

  1. 1. Sheldon Wolff [ October 02, 2014 @ 06:13AM ]

    This decision by the judge was a good one. We've all seen the ads of how a smashed up junk car was repaired and the seller is insinuating like new condition. The used car business has the connotation of dishonesty because someone got stuck with a lemon. However consumer laws and state inspections have eliminated many issues. The auto industry is dynamic and continually evolving. Good reputable dealers are today's ambassadors of good will in the industry. Yes there are many fly by night clandestine dealers and curb stoners, which still propagates the distrust of consumers.
    Car fax records are only as good as a reporting and collection of data. It is often misleading, inaccurate, and incomplete. Their expansion of what a vehicles condition or value with out physically inspecting and driving the subject vehicle is just an actuarial guess, similarly to the industries major guides. We've all experienced the gavel hitting on the block where a particular vehicle sold for much higher or even lower than what the national guides say it's worth. Consumers think car fax and other guides is the absolute bible on value and condition. We know it's not. I must give them credit, it's the best marketing plan I've seen in years in any industry, they created their own consumer demand, forcing the dealers and consumers to buy it. The best way to value a used vehicle is still take it to your own trusted mechanic and buy from a reputable dealer. Consumers need to understand that dealers are nothing more than a place of exchange, and often upgrade their inventory to make them safe sound and drivable.

  2. 2. Sol Vander Veur [ October 21, 2014 @ 05:14PM ]

    When carfax first came about i was positive thety hired people to come to my dealership asking for carfax reports. I ask several people posing as customers if they work for carfax one admitted to me he did.

 

Your Comment

Please note that comments may be moderated. 
Leave this field empty:
Your Name:  
Your Email:  

CLOSE [X]

READ NEXT

Potratz Releases Web Tool That Predicts Shopper Behavior

ExitGadget uses custom algorithms and device tracking technology to determine when a website visitor is exhibiting signs of abandoning the page. It then delivers a customizable message designed to covert the site visitor into a sales lead.