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WASHINGTON, DC — Today in Louisiana, the Fifth Circuit Court of Appeals will hear oral arguments on a lawsuit brought by Washington D.C.-based National Automobile Dealers Association (NADA) challenging the Federal Trade Commission’s (FTC) final “Combating Auto Retail Scams” (CARS) Rule, which is designed to protect U.S. consumers from bait-and-switch tactics and hidden junk fees when purchasing a new car. While the auto retail industry is expected to argue the rule is an overreaction, the Biden-Harris administration’s crackdown on such shady practices is expected to save American consumers a staggering $3.4 billion and 72 million hours each year shopping for vehicles.

Unsurprisingly, the big auto retail trade group chose to venue shop and file its lawsuit in the jurisdiction of the Fifth Circuit which is notorious for sympathizing with corporate interests, including recent rulings in favor of predatory lenders, discriminatory big banks, and greedy credit card issuers—with Big Pharma likely soon to follow. A previous review by government watchdog Accountable.US found that in the months after the FTC rule was first introduced, NADA spent $4.5 million to lobby against the initiative.  

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The auto retail industry claims there’s no need for stronger protections against bait-and-switch tactics and junk fees, and yet they felt compelled to spend millions of dollars lobbying and suing federal regulators to protect the status quo. If such predatory and deceptive practices were truly rare, why would the industry kick into high gear to block Biden-Harris efforts to ensure fairness and transparency? In reality, big auto dealers object to the fact that the CARS Rule will lower costs for consumers by billions of dollars. It’s our hope the Fifth Circuit treats this case with the fairness and impartiality it deserves.”

Accountable.US’ Liz Zelnick

Accountable.US is part of a broad coalition of over 100 national and state advocacy groups, attorneys, and legal aid organizations that support the FTC’s CARS Rule.

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