Attorney loses bid to overturn sanctions for frivolous F&I suit
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A Texas attorney who made a practice of going after dealerships for alleged finance fraud has lost his bid to overturn sanctions for filing a frivolous suit.
A three-judge Texas Court of Appeals panel refused to vacate the award against attorney James H. Owen of Athens for filing a baseless suit on behalf of a client who financed a vehicle from Peltier Enterprises Inc., which does business as Peltier Nissan in Tyler. The award covers the dealership’s attorney fees in defending the suit.
Owen filed a motion seeking a rehearing on Oct. 17, Court of Appeals records show.
Owen’s former law firm in Athens and its principal, Jeffrey Weinstein, were also sanctioned but settled with the dealership and didn’t appeal. According to the decision, Owen had established the firm’s auto finance fraud department and on behalf of the firm “represented plaintiffs in multiple suits against auto dealerships, including Peltier, alleging violations related to retail installment contracts.”
In 2005, customer Josephine Moore signed a retail installment contract that followed the model provisions contained in state law. The contract disclosed the finance charge, amount financed, annual percentage rate and the total amount of the payments she was to make, including the cost of GAP coverage, the court said.
Almost four years later, Moore sued Peltier Nissan alleging fraud, violations of the Texas Finance Code, intentional infliction of emotional distress, deceptive trade practices and other claims.
She later dropped some of the allegations and eventually dropped the entire case.
It was one of eight suits that the law firm had filed and dismissed against Peltier Nissan. The firm also had filed and dismissed 11 suits against Peltier Chevrolet Inc., also in Tyler, according to court documents.
Peltier Nissan requested sanctions, asserting that the suit was “frivolous, groundless and harassing” that some of Moore’s claims conflicted with the contract and state law, and that the statute of limitations barred other claims, the court said.
In an affidavit, Weinstein testified that the firm had disbanded its auto fraud department and that Owen had left the firm after an internal review. The firm is “no longer pursuing these types of cases,” the affidavit said.
Owen said in a recent phone interview that a different Texas Court of Appeals panel reversed an award of sanctions in a similar auto financing fraud suit against Peltier Chevrolet. That panel ruled in April that the dealership had failed to prove that the suit was groundless and had been brought in bad faith or to harass, although the suit was filed after the statute of limitations ran out.
The dealership’s attorneys did not respond to requests for comment.
You can reach Eric Freedman at freedma5@msu.edu.
