"The suit was insulting," Hoffman says. "It's like legal extortion."
Hoffman is not unique. He is one of dozens of California dealers who have been hit by lawsuits that challenged their advertising practices. Elsewhere in the country, dealers are organizing to fight a growing amount of consumer litigation.
In New Jersey, dealers want to promote mediation as an alternative to litigation when consumer disputes arise. In New York, Connecticut and Rhode Island, dealers and lenders are seeking legal limits on lessor liability.
In Illinois, dealers might support a ballot initiative to narrow the grounds for consumer lawsuits. If adopted, that initiative would be patterned after a similar ballot campaign in California.
California dealers have raised $4 million to promote their November ballot initiative. It would allow individuals to file lawsuits only if they can prove damages. Trial lawyers now can sue businesses in the state without producing injured parties or proof of damages.
If voters approve the proposal, only the state attorney general or local public officials - not plaintiffs' lawyers - could sue to enforce laws against unfair business competition.
Rosemary Shahan, president of Consumers for Auto Reliability and Safety of Sacramento, Calif., says she opposes the ballot initiative because "it goes too far."
She adds: "It addresses problems that arose a couple of years ago and ended with the offending attorneys being publicly pilloried and hounded out of the legal profession. We'd rather see dealers working to comply with the law than trying to gut it via the initiative process."
The Illinois Automobile Dealers Association is considering a ballot initiative similar to the California proposal. Last year the Illinois Supreme Court struck down a state law that limited fraud suits against dealers. It ruled the law gave dealers an arbitrary advantage over other businesses.