A federal magistrate judge has let stand a jury verdict in favor of a Kansas City, Mo., Ford store in a Truth in Lending Act suit. The magistrate determined a customer had waived his right to further litigation by agreeing to an earlier settlement of a small claims case related to his vehicle purchase.
The dispute involved Anthony Smiley, who financed his purchase of a 2013 Fusion through Gary Crossley Ford Inc.
Smiley filed his first suit in the small claims division of state court, contending that the store wrongfully excluded him from a trade-in assistance program he believed he’d purchased. The program administrator had notified Smiley that he didn’t qualify because his loan was for more than 72 months.
After mediation, the small claims case settled and the dealership agreed to include Smiley in the program and pay his $45 court costs.
He then filed the federal truth in lending suit seeking damages and attorney fees.
The suit alleged the dealership gave Smiley an illegible copy of the truth in lending disclosure form, thus violating the requirement to “clearly and conspicuously” disclose the annual percentage rate and finance charge in the retail installment sales contract and security agreement, according to court documents.
Gary Crossley Ford argued that Smiley had agreed through the small claims settlement to waive all other claims arising from the vehicle transaction. “We also disputed the underlying truth in lending claim,” dealership lawyer Patric Linden, of Kansas City, Mo., told Automotive News.
At a two-day trial in December, the jury returned a verdict against Smiley.
He then asked U.S. Magistrate Judge Sarah Hays to reverse the verdict or order a new trial.
Hays refused, saying there was enough evidence to support the jury’s determination that Smiley’s settlement of the small claims case waived all other claims involving purchase of the Fusion.
She also ruled that the jury was properly allowed to hear evidence that Gary Crossley Ford had provided Smiley with the APR and finance charge when he bought the car.
Smiley’s lawyer, David McDevitt of Mesa, Ariz., said his client will appeal.
“The disclosure was bad in this case. I think everybody agrees on that,” McDevitt said.
He said dealerships should check their printers and verify that they’re properly aligned” to ensure that the disclosures are clear and conspicuous.