Document fee suits swamp Missouri dealers

Document fee suits swamp Missouri dealers

Lindsay Chappell
Automotive News
September 8, 2008 - 12:01 am ET

Auto dealers across America do it every day. But retailers in Missouri
who charge customers a "document processing fee" find themselves in
the cross hairs of lawsuits that allege they are practicing law
without a license.

Law firms in St. Louis, Kansas City, Springfield and other Missouri
cities are going after dozens of dealers in state and federal courts.
One Kansas City plaintiff's lawyer warns the issue could result in
civil penalties of $1 million to $4 million per dealership.

More than 50 dealerships already have been named as defendants in the
document-fee suits, says Johnny Richardson, legal counsel for the
Missouri Automobile Dealers Association.

"Eventually, I think we're going to see these suits filed against
every dealership in the state that ever charged a fee," Richardson
says.
Interpretations of the law are being worked out, and judgments against
dealerships could be years away.

Fee fight

Highlights of Missouri lawsuits
.. State Supreme Court upheld law that only lawyers can charge for
handling documents
.. Dealerships may face million-dollar penalties for charging
document-processing fees
.. Possible judgments likely are years away


Retailers across the United States use - and sometimes abuse - the
practice of tacking dealer charges of $200 to $500 onto sales
contracts under the guise of document handling. Consumers in New
Jersey, Tennessee and Arkansas have challenged the practice on a
case-by-case basis.

But the situation in Missouri is different. Under Missouri law,
charging consumers for "document processing" is something only lawyers
can do.

State law requires that any nonlawyer who collects such a fee
effectively is practicing law without a license and, therefore, must
refund it at three times the amount collected, say plaintiffs'
lawyers.

Keith Lamb, a lawyer whose Kansas City firm is, by itself,
representing consumers in lawsuits against as many as 40 dealerships,
speculates that the refunding of fees could be made retroactive for
five years. "Do the math and you can see that this could get
extraordinarily expensive for some of these dealers," Lamb said.

Last year, the state's Supreme Court upheld the document-processing
law in a challenge unrelated to auto dealerships. That decision has
triggered a wave of lawsuits around the state in which consumers are
now suing mortgage companies, boat dealerships, motorcycle retailers,
RV dealers and other big-ticket retailers to refund their document
fees.

Some of the lawyers now seek to bring the state's vehicle consumers
together in a class action case over the document fees, but that plan
is under review. Richardson says there has been no decision in any of
the consumer complaints.

On Mon, 8 Sep 2008 09:08:08 -0400, "C. E. White"
> wrote:



Can you list a link to the source of this article please?

Thanks!


>Document fee suits swamp Missouri dealers
>
>Lindsay Chappell
>Automotive News
>September 8, 2008 - 12:01 am ET
>
>Auto dealers across America do it every day. But retailers in Missouri
>who charge customers a "document processing fee" find themselves in
>the cross hairs of lawsuits that allege they are practicing law
>without a license.
>
>Law firms in St. Louis, Kansas City, Springfield and other Missouri
>cities are going after dozens of dealers in state and federal courts.
>One Kansas City plaintiff's lawyer warns the issue could result in
>civil penalties of $1 million to $4 million per dealership.
>
>More than 50 dealerships already have been named as defendants in the
>document-fee suits, says Johnny Richardson, legal counsel for the
>Missouri Automobile Dealers Association.
>
>"Eventually, I think we're going to see these suits filed against
>every dealership in the state that ever charged a fee," Richardson
>says.
>Interpretations of the law are being worked out, and judgments against
>dealerships could be years away.
>
>Fee fight
>
>Highlights of Missouri lawsuits
>. State Supreme Court upheld law that only lawyers can charge for
>handling documents
>. Dealerships may face million-dollar penalties for charging
>document-processing fees
>. Possible judgments likely are years away
>
>
>Retailers across the United States use - and sometimes abuse - the
>practice of tacking dealer charges of $200 to $500 onto sales
>contracts under the guise of document handling. Consumers in New
>Jersey, Tennessee and Arkansas have challenged the practice on a
>case-by-case basis.
>
>But the situation in Missouri is different. Under Missouri law,
>charging consumers for "document processing" is something only lawyers
>can do.
>
>State law requires that any nonlawyer who collects such a fee
>effectively is practicing law without a license and, therefore, must
>refund it at three times the amount collected, say plaintiffs'
>lawyers.
>
>Keith Lamb, a lawyer whose Kansas City firm is, by itself,
>representing consumers in lawsuits against as many as 40 dealerships,
>speculates that the refunding of fees could be made retroactive for
>five years. "Do the math and you can see that this could get
>extraordinarily expensive for some of these dealers," Lamb said.
>
>Last year, the state's Supreme Court upheld the document-processing
>law in a challenge unrelated to auto dealerships. That decision has
>triggered a wave of lawsuits around the state in which consumers are
>now suing mortgage companies, boat dealerships, motorcycle retailers,
>RV dealers and other big-ticket retailers to refund their document
>fees.
>
>Some of the lawyers now seek to bring the state's vehicle consumers
>together in a class action case over the document fees, but that plan
>is under review. Richardson says there has been no decision in any of
>the consumer complaints.

<adventuremyk> wrote in message
...
> On Mon, 8 Sep 2008 09:08:08 -0400, "C. E. White"
> > wrote:
>
>
>
> Can you list a link to the source of this article please?
>
> Thanks!

Try http://www.nxtbook.com/nxtbooks/crai...46417NBMCC/#/4

> Keith Lamb, a lawyer whose Kansas City firm is, by itself,
> representing consumers in lawsuits against as many as 40
> dealerships, speculates that the refunding of fees could be made
> retroactive for five years. "Do the math and you can see that
> this could get extraordinarily expensive for some of these
> dealers," Lamb said.

Lawsuits wouldn't be necessary if the morons wouldn't sign on the
dotted line without understanding what the agreement is.

If people would stop buying cars from stealerships who employ
"document fees" and the practice would stop in about a week.

"Larrybud" > wrote in message
. 245.22...
>> Keith Lamb, a lawyer whose Kansas City firm is, by itself,
>> representing consumers in lawsuits against as many as 40
>> dealerships, speculates that the refunding of fees could be made
>> retroactive for five years. "Do the math and you can see that
>> this could get extraordinarily expensive for some of these
>> dealers," Lamb said.
>
> Lawsuits wouldn't be necessary if the morons wouldn't sign on the
> dotted line without understanding what the agreement is.
>
> If people would stop buying cars from stealerships who employ
> "document fees" and the practice would stop in about a week.

I guess I don't really care how they divvy up the final price. If they want
to call part of it a doc fee, why should I care? I buy from the dealer with
the lowest bottom line price (everything included).

I am eligible for a couple of "supplier pricing plans" because of my
employer. Ford's plan is nice because they specifically prohibit dealers
selling under the plan from adding any fees at all (no doc fees, no
sealants, no fabric treatments, nothing beyond the assigned supplier price).
Nissan's plan allows doc fees but you can argue about it. Toyota doesn't
provide supplier pricing (at least for people that work for my employer).

Ed