Monroe car dealership sued by Ohio AG

Ohio Attorney General Mike DeWine has sued Monroe Dodge Chrysler Jeep Superstore in Monroe, MI, accusing it of using deceptive advertising.

Essentially, the lawsuit says that advertising to Ohio residents did not follow Ohio laws - and numerous attempts to get the dealership to comply have failed. In fact, it says previous agreements with the firm regarding Ohio laws were not honored.

Here is a copy of the lawsuit.

Here is the press release:

TOLEDO, Ohio)—Ohio Attorney General Mike DeWine today announced a lawsuit against Monroe Dodge-Chrysler, Inc., which does business as Monroe Dodge Chrysler Jeep Superstore, of Monroe, Michigan. The Attorney General’s lawsuit accuses the dealership of using deceptive advertisements.

“Businesses that advertise to Ohio consumers must follow Ohio’s rules,” Attorney General DeWine said. “Otherwise, it’s not fair to consumers or to businesses that do follow the rules. The office has worked with this dealership on many occasions to address advertising violations, but the problems continue to resurface.”

Monroe Dodge Chrysler Jeep Superstore is located at 15160 S. Monroe St. in Monroe, Michigan. The dealership sells new and used vehicles and advertises online and in print to consumers in Michigan and Ohio.

According to the Attorney General’s lawsuit, the dealership violated Ohio’s Consumer Sales Practices Act by advertising prices for which not all consumers qualified, failing to disclose all required terms, and failing to clearly disclose important exclusions or conditions of a sale. The Attorney General seeks an injunction to stop further violations, reimbursement for any affected consumers, and civil penalties.

The Ohio Attorney General’s Office had entered into past agreements with the dealership to address similar advertising violations, but the Attorney General’s Office found that violations continued.

To assist dealerships in complying with Ohio law, the Ohio Attorney General’s Office offers a publication called “Guidelines for Motor Vehicle Advertising,” which is available on the Attorney General’s website, and works cooperatively with dealer associations to provide advertising compliance presentations.

Consumers who suspect unfair or deceptive advertising or other violations should contact the Ohio Attorney General’s Office at 800-282-0515 or www.OhioAttorneyGeneral.gov.

A copy of the lawsuit is available on the Attorney General's website.

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AG sues Toledo firm Making Home Affordable USA

Press Release:

TOLEDO, Ohio) – Ohio Attorney General Mike DeWine today announced a lawsuit against N.M.M.S.R. Incorporated, doing business as Making Home Affordable USA, and its owner Jason Keating of Maumee. The lawsuit charges Keating and his business with multiple violations of Ohio's consumer laws.

"Too many consumers have lost thousands of dollars, or even their homes, because of loan modification services that did nothing to help them," DeWine said. "We are continuing to target foreclosure relief businesses that mislead consumers, and we will continue to take action when we find them."

Making Home Affordable USA is located at 120 10th Street in Toledo. It offers loan modification and foreclosure assistance services through its "National Mortgage Modification Stimulus Home Saver Program." Although the business' name and website closely resemble that of the federal government's Making Home Affordable program, Making Home Affordable USA is not associated with the federal government.

According to the Attorney General, the business instructed consumers to stop making their mortgage payments (even if they were current on their payments) and stated that banks and lenders would not negotiate unless consumers were behind on their payments. Consumers paid 60 to 65 percent of their current mortgage payment to the business after the business assured them that the funds would be held in escrow and submitted to their lenders once a modification was reached. Consumers' lenders never received any of the funds placed into the accounts.

Approximately 30 consumers have filed complaints with the Attorney General's Office, the Better Business Bureau, or the Federal Trade Commission. Their losses total around $75,000. Many additional victims likely have been affected.

The lawsuit charges the business and its owner with violations of Ohio's Consumer Sales Practices Act and Telephone Solicitation Sales Act. Specific counts include failure to deliver, encouraging consumers to default on their mortgages, and failing to register as a telephone solicitor. The Attorney General seeks consumer restitution, permanent injunctive relief, and civil penalties.

"Don't trust a business that tells you to stop making your mortgage payment in order to get a modification," DeWine said. "Not only is it bad advice — in Ohio, it's also illegal."

Attorney General DeWine offers consumers the following advice:

* Do not pay up-front fees for help avoiding foreclosure or obtaining mortgage relief. By law, companies are prohibited from charging and accepting fees for mortgage assistance relief services until consumers receive and accept a loan modification offer from their lenders.
* Research a business before providing any money or personal information. Check to see if consumers have filed complaints with the Ohio Attorney General's Office and check a company's reputation with the Better Business Bureau. Don't use a loan modification business that charges upfront fees.
* Contact Save the Dream Ohio if you are having difficulty making your mortgage payments. Call 888-404-4674 or visit www.savethedream.ohio.gov for free foreclosure assistance.

Consumers who believe they have been treated unfairly in any transaction should contact the Ohio Attorney General's Office at www.OhioAttorneyGeneral.gov or 800-282-0515.

A copy of the lawsuit is available on the Ohio Attorney General's website.

Why the GOP is fighting the CFPB

If you want to know why the Republicans in the Senate were fighting against the nomination of Richard Cordray to the Consumer Finance Protection Bureau, thus halting the new agency from beginning its work, this snippet from Jonah Goldberg's column, An Imperial Sham, tells you everything you need to know:

The CFPB is a constitutional affront, the crowning achievement of this White House's mantra of never letting a crisis go to waste.

The agency has the power to regulate any practices it deems "unfair" -- primarily the practices of institutions and businesses that had nothing whatsoever to do with the financial crisis.

Indeed, it has blank-check power to write the rules it wants to enforce. Worse, it cannot be reined in by Congress, because Dodd-Frank gave it a self-funding mechanism. It can simply take up to 12 percent of the Federal Reserve's operating expenses to do whatever it wants. The power of Congress is ultimately the power of the purse. But in their finite wisdom, Democratic lawmakers gelded themselves. They also insulated the rogue agency from the courts, requiring that judges defer to the CFPB's legal theories.

So it has no accountability to Congress and even the courts won't be able to rein it in or restrict it any way.

But that's not all. Despite what Pres. Obama is saying about being blocked by Republicans, even Democrats recognize the problems and have supported the exact changes Republicans are pushing for, as Michelle Malkin explains:

As Senate Republicans have been pointing out for months, Dodd-Frank threw out judicial review, removed CFPB from the congressional appropriations process, provided five-year tenure protection for the director and transferred the agency from the Treasury Department to the opaque and unaccountable Federal Reserve.

Obama and Democratic leaders themselves recognize the recklessness of vesting so much unfettered power in a single individual. In 2009, Obama floated a bipartisan board to oversee enforcement. Democratic Sens. Dick Durbin of Illinois, Charles Schumer of New York and Sheldon Whitehouse of Rhode Island all co-sponsored legislation backing a commission. Massachusetts Democratic Rep. Barney Frank was also an original sponsor of a bill creating the very kind of five-member panel Republicans have proposed.

The House passed these and other structural reforms last year, but the Senate has failed to act, and the White House insists on demagoguing reformers. Moreover, taxpayers remain in the dark about how and how much the CFPB is spending, because Dodd-Frank allows the agency to draw funds from the Federal Reserve's operating expenses. Out of sight, out of mind.

...

It's about consolidating bureaucratic authority and granting unprecedented immunity to a single super-cop from congressional and public oversight.

This agency will NOT be a protector of consumers - not when its existence and structure is an affront to the Constitution.

Government is supposed to protect our God-given liberties. Any agency with this much power and control - and no checks from the judicial branch - will end up a tyrant, not a protector, as its beginnings are proving.

Two very important facts to remember about Obama's 'recess' appointments

Two very important and critical facts to remember about President Barack Obama's 'recess' appointments of Richard Cordray to the Consumer Financial Protection Bureau and three nominees to the National Labor Relations Board:

1) Congress is NOT in recess!

Yes, the President does have the ability to make recess appointments, meaning that people serve in his cabinet without the "advice and consent" of Congress - a Constitutional mandate.

However, there is no authority to make an appointment when Congress is still in session. Doing so violates the oath the President took to uphold the Constitution, and is contrary to the procedures designed to serve as a check-and-balance between the branches of government.

The current definition of 'recess' is when Congress is officially not in session for more than three days. Through a procedural action used by Democrats (and supported by then Sen. Obama) when they were trying to prevent President George W. Bush from making recess appointments, the Congress continues to hold "pro forma" sessions every three days. This policy, and the standard of three days, was supported by Democrats as well as Pres. Obama's own administration official, former Acting Solicitor General Neal Katyal.

Katyal, during arguments before the U.S. Supreme Court in 2010, responded to a question about why the President could not bring the NLRB to full strength through a recess appointment by saying, “I think our office has opined the recess has to be longer than three days.”

Between 2007 and the end of his term, Pres. Bush made no recess appointments because the Democrat-controlled House and Senate did not go into recess and, instead, held "pro forma" sessions specifically to prevent such appointments. Unlike our current President, Pres. Bush did not whine and complain and decide to circumvent the Constitution in order to get his way.

In fact, a president hasn’t made a recess appointment during a Senate break of fewer than three days since 1949, according to Betty Koed, an associate Senate historian.

The outrageous hypocrisy of the President and Democrats who supported this procedure in order to prevent a Republican from making recess appointments, but who now praise the violation because it's being done by a Democrat, is simply astounding! And the failure of the media to point out the hypocrisy and double standard is unconscionable and certainly a dereliction of their duty to the public.

2) There are good and valid reasons these people have not been approved by the Senate!

Pres. Obama had warned us that if Congress didn't do what he wanted, he'd go ahead with out them. Despite the clear unconstitutionality (and perhaps impeach-ability) of such actions, we should have believed him. He's out to "fundamentally change" our nation and what better way to do so than to ignore and flaunt the Constitutional mandates placed upon him?

In response to the announcements, United Steel Workers president Leo Gerard said:

"Republicans left the President with no choice but to recess appoint these four people, three to the National Labor Relations Board (NLRB) and one to direct the Consumer Financial Protection Bureau. President Obama showed today that he will use every means at his disposal to circumvent Republican opposition to safeguarding workers and consumers."

The SEIU, on the NLRB appointments, stated:

The appointments bypasses the predictable Republican filibusters or other obstructionist measures they would employ. There is no doubt that if given the shot, the GOP would have done away with the Board entirely, probably the very worst thing working families need right now.

Note the future tense: "measures they would employ."

The fact of the matter is that Pres. Obama only submitted the names for the NLRB on December 15th. The Senate has not, as far as I could tell, even held a hearing on two of them: International Union of Operating Engineers General Counsel Richard Griffin and former attorney to Ted Kennedy, Sharon Block.

As Moe Lane writes:

They have not been in point of fact filibustered; the question hasn’t even arisen yet, given that it’s been all of nineteen days since the names were submitted and a huge chunk of that time was the Christmas/New Year’s break. I’ve heard of… anticipation, but that’s just absurd. If you’re going to try to paint the opposition party as obstructionists, common courtesy dictates that you at least give the opposition party a chance to actually obstruct. Otherwise you’re just being silly.

One hopes that the President is not going to make a habit of this sort of thing…

PS: What’s that I hear? “The GOP was going to obstruct anyway, so it’s perfectly all right for the President to get it over with quickly!” …Do tell. And God, but do I feel sorry for the wife of any man making that particular argument…

So at least for the NLRB, the Congress hasn't even had a chance to act on the nominations, putting lie to the claim that Pres. Obama had to act because of a "do-nothing" Congress or obstruction by the Republicans.

When it comes to the Cordray appointment, the issue has been over the CFPB itself and its accountability, as well as scope of authority.

Pres. Obama nominated Cordray in July and his confirmation was blocked by Republicans only last month. In what has been a stalemate with Pres. Obama, the Republicans have blocked the confirmation as a way to prevent the new agency from being fully operational because they believe the consumer agency's powers are too broad.

CFPB was created under the Frank-Dodd bill, which says the CFPB can't commence operations until after its head is confirmed by the Senate, as Ohio Sen. Rob Portman explains:

The irony is that while this recess appointment may advance the White House’s political goals, it does nothing to advance the work of the CFPB. The statute creating the CFPB makes clear that only Senate confirmation of a Director – not a recess appointment – can activate the new powers of this agency to regulate consumer transactions with Main Street businesses.

As I have said many times, this is not about Rich Cordray, who I believe is a good public servant. Long before he was nominated to be CFPB Director, I expressed my strong concerns about the impact this new regulator would have on all of us as consumers, on job creation, and on our economy, and recommended some commonsense reforms. No other federal regulator has so much authority over personal economic decisions, with so little responsibility to answer to the American people and their elected representatives. These concerns -- voiced by 44 Senators -- cannot be addressed if the White House continues to refuse to work together despite my and others' efforts to reach out to them to find a way forward.

Contrary to the President's claim, the Congress isn't doing 'nothing.' It is, in fact, doing something: taking seriously its charge to advise and consent. Pres. Obama, not liking the advice and not getting his consent, is acting like a child in going ahead anyway.

Of course, he believes that 'standing up to Republicans' and painting himself as 'trying against a do-nothing Congress' is going to help him in the 2012 election - and he may be right politically.

But it's certainly wrong for our nation and our future to blatantly ignore the checks and balances and separation of powers in our Constitution for some hoped-for political advantage.

Table saws, government mandates, monopolies and crony capitalism

On October 5, the Consumer Product Safety Commission, voted unanimously to start looking at ways to reduce table saw injuries.

"Wow," you think, "that's a good thing! I mean, those terrible table saws can be pretty dangerous, even for people who are careful. Good for this non-elected agency that's looking out for our best interests!"

They are, according to this statement from the chairman, "determined to be a part of the solution to reduce the serious number of preventable table saw injuries that occur each year." (Yep - determined, whether needed or not!)

The problem is, they're not going to say they can actually reduce table saw injuries - they're just going to start looking for ways. Oh - and those ways they're looking for? It means new regulations - not new designs or innovative safety features.

No - new designs and technology and innovative features are what happens on the manufacturer's side... not the government's.

Also from the chairman's statement:

Last year, I called on the table saw industry to address this hazard through the voluntary standards process and work to prevent the needless injuries that occur each and every day. Despite my public urging for the power tool industry to make progress voluntarily on preventing these injuries, no meaningful revisions to the voluntary standard were made. Therefore, when the first opportunity arose this past June to reinitiate federal rulemaking through the CPSC’s FY 2011 Mid-Year Review vote, I joined my colleague Commissioner Robert Adler’s amendment, directing staff to prepare a briefing package with an ANPR by September 2011, to address table saw blade contact injuries. Although the Commission was urged by some to allow the voluntary standards process continue without initiating a rulemaking, the frequency and severity of the blade contact injuries associated with table saws demanded action via the ANPR.

But here's the thing that really makes a mockery of the whole 'government as savior' attitude. According to the Power Tool Institute, headquartered in Cleveland, since table saw manufacturers started using new guard systems in 2007, there have been no reported blade-contact injuries on any saw using the new guards.

So why in the world would a government agency decide now to impose new regulations? After all, isn't four years without injury a long enough time to judge the effectiveness of the new design? Wouldn't that be a rather exemplary record to be praised?

Turns out, crony capitalism may be to blame - or perhaps it might be a case of using the government for personal benefit.

You see, there is a company called SawStop, with a product by the same name. Their design will, the website claims, stop a table saw blade within five milliseconds of detecting contact with skin.

Since I don't use table saws, but most of the men in my family do or have, I asked them about this new design. They all thought it was a great idea - especially the engineers - if they could afford it.

Cost - aye, there's the rub.

SawStop sells table saws equipped with the design. This is their niche - their marketing angle - and it's a good one. And, according to some news reports, it seems to be successful as the company has sold 'tens of thousands' of their saws.

But, rather than be content that a different product is on the market that people can choose to purchase, consumer advocates are pressuring the government to mandate the inclusion of this new technology on all table saws, as this NPR article explains:

"The problem is enormous, and it's getting worse," says Sally Greenberg, who heads the National Consumers League and has been a top lawyer with Consumers Union.

The problem, she explains, is that there's a safety brake technology that can stop a table saw instantly — before it cuts off a user's fingers. It's like an airbag in a car. It's a breakthrough safety feature. But only one company in the entire industry is using it.

"We've got this great technology — it's not terribly expensive to implement," Greenberg says. "Let's do it."
...
Greenberg says this case is a classic example of why the Consumer Product Safety Commission was created.

"You have a pattern of injury, you have a technology that can address the injury, and it can address the injury for a reasonable cost," she says.

Given the life-altering harm these injuries cause, Greenberg says the government should mandate a safety brake like this for all table saws.

My argument would be that since the product is on the market and available, it should be a consumer's choice which table saw they want to purchase. Do they want to buy this one or that one - do they want this feature or that one - how much do they want to pay and what features are most important to meet their needs?

Strangely, that seems to be the position other manufacturers have taken in their statements during hearings on the matter:

"SawStop is currently available in the marketplace to any consumer who chooses to purchase it," says Susan Young, who represents Black & Decker, Bosch, Makita and other power tool companies.

In other words, let consumers decide. Young says many consumers won't want to pay for the SawStop technology, which could add $100 to $300 in cost, depending on which side you talk to.

A quick check online shows that table saws range in price from around $125 to $3,000, so adding $100-300 to the cost could be significant if you're only looking for the $125 model. A similar check found prices of $1,600 to $3,400 for SawStop's products. Perhaps, given a purchaser's budget and need, they'd rather not pay SawStop's cost and, instead, go with another type of guard on the blade?

Despite what appears to be success in the market, Steve Gass, the owner of SawStop and the holder of the patents on the technology, would stand a make even more profit if his product was required by the government. And it's his petition the CPSC is addressing:

Recently, Gass petitioned the Consumer Producer Safety Commission (CPSC) to require emergency brakes for all table saws. The request is being met with opposition from the industry—not only because the mandate would increase costs for manufacturers and consumers, but because Gass’s product is patented and would create a monopoly in the market.
...
As the sole owner of safety-brake technology, Gass would be able to charge whatever he wants for the safety-brake system—at present, Gass’s proposed cost adds about $100 in manufacturing costs for each saw, not including royalties. While this may be a negligible increase for high-end saws, it would double the price of cheaper saws. In addition to the added production costs, industry representatives say it would cost manufacturers tens of millions of dollars to re-tool to build saws with the device.

The Power Tool Institute believes the mandate will give SawStop a monopoly:

The Power Tool Institute is concerned the CPSC will mandate the use of SawStop, which, it argues, would give Mr. Gass's small saw manufacturing company, also called SawStop, a monopoly over giant power tool makers that have already rejected the technology.

"Unfortunately, for consumers, such a mandatory standard could as much as quadruple the cost of current inexpensive saws and significantly increase the cost of professional saws on the market today," the trade group said. The group plans to urge regulators not to "create a standard that enriches a private company while passing unnecessary costs on to consumers," it added.

Mandating anything too similar to SawStop could also be a problem for the industry, which could be forced to pay the SawStop company royalties on dozens of patents it has secured.

Yes, you read that correctly. Gass approached the larger manufacturers and tried to sell them his design - and they rejected it. So he went to the government in 2003 to see if he could get his design mandated - and he teamed up with the National Consumers League to do so.

And now, it appears, this non-elected government agency seems happy to oblige by creating a federally-mandated monopoly for SawStop, despite the fact that current safety features seem to be working just fine.

But this raises an even bigger question: the proper role of the government.

Some will claim that government has a responsibility to ensure that manufacturers include safety provisions and user warnings on their products. But no manufacturer wants people to hurt themselves using their products. Contrary to the belief of some, most companies understand that the negative publicity from harm to a customer is more costly than the safety provisions they could include. They also understand that customers will pay only so much for such protections - gladly paying for protections they, personally, need and want, but rejecting products with other protections that might include a higher price.

This is the beauty of the marketplace - there are products to meet all needs.

But in recent years, it appears that manufacturers are being held accountable for the stupidity of consumers (consider the lawsuit against McDonald's for hot coffee, or warning on plastic bags that tells parents not to let children play with them or put them over their heads). The Foundation for Fair Civil Justice even holds a Wacky Warning Label Contest to highlight some of the more ridiculous warnings that manufacturers now feel necessary to include.

And the stupidity of consumers is the argument being used in this case. According to several reports I read in researching this issue, Gass and his supporters have claimed that some people disable the guards on the equipment (for various reasons) so government needs to mandate even better protections - foolproof ones for people who are stupid enough to ignore or remove the ones that already come with the product.

And government, happy to inject themselves into our daily lives and save us from our own stupidity, is all too "determined to be a part of the solution."