Indiana dealership group sued in class action over document fees

An 11-rooftop Indiana dealership group is facing a class-action lawsuit after customers say they were charged an illegal document preparation fee. It is the second such lawsuit filed this month against dealerships in the state, and legislation is already in the works to legalize fees under $200.

The customers filed the class-action lawsuit last week, accusing Andy Mohr Automotive Group of deceptive sales practices.

The suit says that customers who purchased from the dealership group were charged an unlawful document preparation fee of $199. The class includes potentially "hundreds or thousands of persons throughout the state."

The group operates dealerships in Indianapolis, Bloomington, Avon, Fishers and Plainfield, Ind. Executive management of Andy Mohr Automotive did not respond to Automotive News' requests for comment.

The fee violates Indiana's Deceptive Consumer Sales Act, according to the suit, because the group uses it "not to merely cover the expenses actually incurred for preparing documents, but as a tool to extract additional profits from consumers in an unfair and prohibited manner."

The dealership group made hundreds of thousands of dollars through these fees, the suit said.

Under Indiana's deceptive sales act as cited in the suit, an affected consumer can sue for whichever is greater: the damages suffered from the deceptive act or $500.

Robert Lutz is listed as the plaintiff, representing himself as well as any Andy Mohr customers who were charged a similar fee "at any time during the period beginning six years before the filing of this lawsuit to the date of class certification."

In order to comply with Indiana law, the suit alleges that a document preparation fee has to accurately reflect expenses of preparing documents and must be disclosed by the dealer. The fee must also have been negotiated between the dealer and the customer, according to the suit.

This is the second class-action lawsuit related to dealership documentation fees filed within the past two months by Cohen & Malad, the firm representing Lutz, according to Vess Miller, the plaintiff attorney for both cases. The firm also filed a class action against Butler Toyota in Indianapolis on April 4 for charging $169 in document preparation fees.

A local news outlet reported that a bill, House Bill 1237, contains an amendment that would legalize document fees below $200 in Indiana and retroactively apply the guideline to any vehicle sale since July 1, 2013.

Sen. Aaron Freeman, R-Indianapolis, told RTV6 Indianapolis that the dealerships had a "gentleman's agreement" with the Indiana Attorney General's office, wherein the office wouldn't investigate a dealership's fee if it remained below $200. The bill has passed through the state Senate and is making its way back to the House.