Lemon Laws: Chrysler Car Owners Still Covered After Company's Bankruptcy

Chrysler car owners will still enjoy legal protections from serious vehicle defects - rights that are guaranteed under their states' "lemon laws" - even after the car giant re-emerges from bankruptcy under new ownership. That's the not-so-sour result of an agreement reached this week between the new Chrysler LLC and state attorneys general.

Chrysler vehicle owners and consumer rights groups had questioned whether the new owners of Chrysler would "honor Lemon Law rights for vehicles sold or leased by Chrysler prior to the sale of the company," according to a News Release from Florida Attorney General Bill McCollum, but after negotiations with a number of state attorneys general, the new group (led by Fiat Group SpA) "agreed to honor the Lemon Law rights consumers had under Chrysler before the buyout."

What are Lemon Laws? In every state, "lemon laws" give car owners legal rights to free repairs if their new (and newer) vehicles have serious defects -- like mechanical problems -- that are typically covered under a new car warranty. Depending on the severity of the car's problems and the number of repair attempts made, car owners may be legally entitled to a new replacement vehicle under their state's lemon laws. Learn more: State-by-State Lemon Law Information.

Lemon law rights of Chrysler owners are just one of the legal issues raised by the car company's Chapter 11 bankruptcy filing in April, and its planned re-emergence under new ownership. Last month FindLaw's Injured blog reported on the shaky status of some personal injury lawsuits filed by Chrysler owners. 

• News Release on Chrysler Owners' Lemon Law Rights (Florida Attorney General)
• AP: Chrysler Drivers Still Covered by State Lemon Laws
• Your Rights If Your Car is a Lemon (FindLaw)
• State-by-State Lemon Law Information (FindLaw)
• Products Liability FAQ (provided by Law Offices of Jeffrey I. Amtman)
• Chrysler Bankruptcy: What Happens to Car Owners' Lawsuits (FindLaw's Injured)
• Bankruptcy FAQ (provided by Greenway Law LLC)

Car Warranty Robocalls: How to Protect Yourself

Three companies have been ordered to stop making car warranty expiration warning "robocalls" and have seen their assets frozen, after the Federal Trade Commission (FTC) filed a lawsuit over the calls last week.

Temporary restraining orders were issued against Voice Touch, Inc., Network Foundations, LLC, and Transcontinental Warranty, Inc., by U.S. District Judge John F. Grady in Illinois late last week. The orders came shortly after the FTC filed a federal lawsuit accusing the companies of "operating a massive telemarketing scheme that used random, pre-recorded phone calls to deceive consumers into thinking that their vehicle’s warranty is about to expire."

These restraining orders and the FTC lawsuit are the latest rounds in the legal fight against car warranty robocalls. As many as 30 states are investigating the calls, as reported here last week, and Indiana Attorney General Greg Zoeller has filed a lawsuit against two telemarketing companies hawking auto service contracts. Now is a good time to learn more about how these car warranty robocall companies operate, and what you should watch out for.  

Car Warranty Scams: Protect Yourself. The sketchy companies behind the growing auto warranty robocall trend are trying to convince consumers that the calls are coming from their car dealer, or from someone affiliated with their car dealer. But really they're just independent (and likely not very reputable) businesses trying to sell service contracts to car owners. These "deals" have nothing to do with your car or your warranty, and the pitches are often made to people who don't even own a car. Worst of all, after all the high-pressure sales tactics, and payment of hundreds or even thousands of dollars, "if you buy a service contract, you may find that the company behind it won't be in business long enough to fulfill its commitments, " according to the FTC.

So, you should ignore robocalls telling you that your car's warranty is about to expire. But if you have legitimate concerns about your car's warranty (i.e. whether it actually has expired and whether additional coverage may be optional) check the paperwork on your vehicle and contact the dealer or the service center listed there.

No matter what, to avoid possible identity theft or other fraud victimization, don't give out your personal or financial information to a company that contacts you via a robocall, since you don't know who is on the other end of the line. Even if an offer sounds legitimate, always ask for more information in writing, and take some time to investigate the business before giving over any information or payment. Learn more: How to Steer Clear of Auto Warranty Scams 

• Judge Orders Halt to Illegal Robocalls Selling Deceptive Warranties (FTC.gov)
• N.Y. Times: Court Issues Order Against 3 Car-Warranty Marketing Firms
• How to Steer Clear of Auto Warranty Scams (FTC.gov)
• Car Warranty "Robo-Calls" Spark Lawsuits and Federal Probe (FindLaw's Common Law)  
• 7 Businesses to Watch Out For (Inc.com) 
• Criminal and Civil Forfeiture (provided by Escobar, Ramirez & Associates)  

New Vehicle Database Lets Consumers, Law Enforcement Combat Auto Fraud

A new online vehicle database unveiled by the federal government gives used car buyers unprecedented access to critical vehicle history, and will allow law enforcement agencies to better monitor and prevent the selling of dangerous and stolen vehicles and other types of auto fraud.

Launched Friday by the U.S. Department of Justice, the new National Motor Vehicle Title Information System allows potential car buyers to get real-time access to a used vehicle's records -- including odometer data, title history, salvage and "total loss" designations, and theft reports. The New York Times "Wheels" Blog reports that data on about 73 percent of vehicles registered nationwide is now available on NMVTIS, with all states required to participate by around this time next year, but "the biggest improvement is that for the first time salvage yards, junkyards and insurance companies will be required to report on vehicles that had been totaled," beginning March 30, 2009.

The National Motor Vehicle Title Information System, an online system of the U.S. Department of Justice, was established under federal law in 1992 and is operated by the American Association of Motor Vehicle Administrators. According to an FBI Press Release, users of the NMVTIS will include state titling agencies, law enforcement officials, consumers, auto recyclers, salvage and junk yards, and insurance carriers. The system will allow consumers and law enforcement to easily identify vehicles that have incurred sufficient damage and been classified as “junk” or “salvage”; view updated odometer readings; and verify information on a vehicle's ownership documentation.

• The National Motor Vehicle Title Information System
• FBI Press Release: National Auto Fraud and Theft Prevention System Goes Live (FBI.gov)
• FBI Fact Sheet: National Motor Vehicle Title Information System (FBI.gov)
• N.Y. Times Blogs: A Used-Car Promise Finally Delivered
• CBS News: System Targeting Auto Fraud To Go Live
• Chicago Tribune: Justice Department Program Makes It Easier To Track Cars' Title History
• Consumer Guide to Buying a Used or New Car (FindLaw)
• Lemon Laws and Car Buyer Protections (FindLaw)
• Car Buying Tools and Resources (FindLaw)

Study Finds SUVs Aren't Safer for Kids When it Comes to Car Crashes

According to a new study released by The Children's Hospital of Philadelphia ("CHOP") and State Farm Insurance, kids who ride in SUVs are not necessarily safer than children riding in regular passenger vehicles.  The study examined SUV car crashes involving vehilces from '98 or later, involving some 3,933 whose passengers were aged 0 to 15, and had crashes reported to State Farm,.

• Car Accidents
• Car and Motor Vehicle Recalls