DETROIT - Consumers' attorneys want to block Detroit-area auto dealer Mel Farr from installing a device on consumers' vehicles that disables the vehicles if payments are missed.
The attorneys also have accused Farr of business practices that violate Michigan consumer laws and of taking advantage of customers with poor or no credit histories.
At a Nov. 9 news conference, Detroit attorneys Kenneth Hylton of Hylton & Hylton and Law-rence Charfoos of Charfoos & Christensen said the device is dangerous because it abruptly shuts down customers' vehicles in traffic.
Farr owns the 14-franchise Mel Farr Automotive Group in Oak Park, Mich. His company installs the electronic device, called 'On-time,' on each vehicle it finances through its subprime finance company, Triple M Finance Co.
A hearing on a preliminary injunction to halt installation of the device is scheduled for Friday, Dec. 10, in Wayne County Circuit Court.
Meanwhile, a separate civil lawsuit accusing Farr of fraud and violating the Michigan Consumer Protection Act was filed in November in the same court by Hylton and Charfoos.
A spokeswoman for Farr had no comment after the Nov. 9 conference.
At a Sept. 9 news conference, Farr had defended his business practices, saying he is providing a service for poor consumers who have few financing and transportation options.
Last summer Farr drew media attention after two customers filed lawsuits alleging that the electronic devices shut off the engines of their vehicles while they were in traffic. Also, Farr was criticized for charging customers interest rates of more than 20 percent.
The lawsuit filed in November on behalf of Carolyn Pettus and Fred Hall alleges that Pettus purchased a 1990 Plymouth Horizon with 87,419 miles on its odometer from one of Farr's dealerships on Dec. 30, 1996, and that the car broke down three days later. The car was towed to one of Farr's dealerships to be repaired.
According to the lawsuit, the purchase price of the Horizon was $3,995; taxes, license, extended warranty and finance charges increased the price to $6,686.48.
Pettus was given a rental car by the dealership in February 1997 'which was to be free as compensation for all of the inconvenience she suffered due to not having her car,' the suit states. Also, Pettus was told that the Horizon would be repaired if she continued to pay on it, which she did, according to the lawsuit.
The suit alleges that Pettus continued to call the dealership about her car. On June 12, 1997, Pettus received a call from the dealership saying that her car was ready. When she arrived at the dealership that same day, Pettus was told that she could not have the Horizon and that she would have to pay for the rental car, the suit says. Pettus refused to pay for the rental car.
In addition, Pettus said she was offered a 1987 Ford Taurus with 129,339 miles on it in place of the Horizon.
A second car
Pettus, who was at the Nov. 9 news conference, said she spent eight hours at the dealership and tried to refuse the Taurus but was told that if she did not take it, she would wind up without a car at all. The price of the Taurus was $6,824.77; taxes, license, extended warranty and finance charges increased the total price to $11,694.08. Pettus said she reluctantly purchased the car and was not given credit for the payments she had made on the Horizon.
The Taurus stopped running in August 1997, according to the suit. Pettus' attorney said she then stopped making payments on it.
The suit alleges that Hall purchased a Horizon from Farr on Feb. 8, 1998, for $8,995; taxes, extended warranty, license and finance charges increased the price to $13,875.74. The suit says it was the same Horizon that Pettus had bought earlier.
The suit says Hall almost immediately started to have problems with the car. After about a year, he had it towed back to the dealership and left it there, Hylton said. Hall stopped paying on the car after leaving it at the dealership, Hylton said.
The suit seeks damages in excess of $25,000 plus costs, interest and attorney fees.