Lawsuits Put Car Shops in a Fix
Lawyers at Consumer Enforcement Watch say they are fighting for countless Californians who have been ripped off by auto mechanics. The Santa Ana-based nonprofit group has sued nearly 2,000 garages for allegedly padding bills, using secondhand parts and failing to provide customers written estimates.
But the auto repair industry insists it is being scammed by attorneys seeking big legal payouts for bogus claims.
The civil suits, filed over the last few months, target 5% of all auto repair shops in California. Beverly Hills attorney Damian Trevor said the shops have a history of unfair business practices and have, at one time or another, been reprimanded by the state’s Bureau of Automotive Repair. Each suit cites violations noted in state records.
“The public is tired of getting scammed,” Trevor said. “We’re telling these bad shops that the buck stops here.”
Shop owners and trade groups said Consumer Enforcement Watch was created just months ago for the sole purpose of winning settlements and attorneys fees for a group of young lawyers. “Basically what they’re doing is a shakedown of small businesses in Southern California,” said Will Woods, executive director of the Automotive Trade Organizations of California. “They don’t represent customers.... They’re bloodsuckers.”
On Friday, more than 50 mechanics picketed in front of Trevor’s Santa Monica Boulevard law office to protest the lawsuits.
The suits have been filed under the state’s Unfair Competition Act, which forbids such practices as false advertising and price fixing. The act permits people to sue businesses even if the plaintiffs have not been personally victimized.
The law has long been the subject of debate in Sacramento. Proponents say it protects consumers by allowing them to sue companies they believe are guilty of unfair business practices. Critics, however, say the law has been hijacked by profit-seeking lawyers and should be altered to make filing suits more difficult.
Business groups such as the California Chamber of Commerce have tried for years to weaken the law to make it harder for suits to move forward. But their efforts have been thwarted by trial lawyers, who have lobbied to keep the existing laws.
Assemblyman Robert Pacheco (R-Walnut) introduced a bill this year that would have significantly altered the unfair-competition law by banning repetitive lawsuits and requiring that plaintiffs suffer some palpable harm. But the bill never made it out of the Assembly Judiciary Committee.
Auto repair shops started being hit with the civil lawsuits in April.
Defendants contend that shortly after they are named in the lawsuits, they receive calls from Trevor and fellow lawyers urging them to settle out of court. The payments, which include attorney fees and funds for the operation of Consumer Enforcement Watch, have ranged from $1,700 to $25,000. Trevor said that so far, 600 shop owners have agreed to settle.
“I gave them $2,000 just so they would get out of my face,” said Gary Balikji, owner of a garage in Stanton that was accused of not keeping accurate paperwork. Balikji said he decided to settle after his lawyer told him it could cost as much as $10,000 to defend a case in court.
“It’s complete robbery, but I don’t have the time to deal with it,” he said. “I’m too busy to go to court.”
