California Dealer Group Suing TrueCar, Again

TrueCar faced a few lawsuits in 2015, ending the year with four of the five major lawsuits against the company being either dismissed or withdrawn. However, one of the headline-making lawsuits dismissed in 2015, has been amended in 2016.

The California New Car Dealers Association is starting off 2016 with a renewed legal pursuit of TrueCar. CNCDA doesn’t think TrueCar is in compliance with California state law. They reportedly aren’t seeking monetary damages in their lawsuit against TrueCar, but are seeking ruling mandate compliance.

According to the SacBee, CNCDA is suing TrueCar for:

-Unfair Competition

-False Advertising

-Acting as a Broker, without license to do so

Speaking to the Sacramento Bee, Brian Mass, President of CNCDA said, “TrueCar actually matches a buyer and a seller and gets paid for doing so. This is brokering, and TrueCar isn’t licensed as such. “CNCDA reportedly alleges TrueCar cannot claim “no surprise or hidden fees,” while being paid a fee each time one of their leads converts into a sale at a dealership.

TrueCar, however, reports not being concerned with the lawsuit.

In an email to the SacBee, John Stephenson, TrueCar’s chief risk officer, noted this lawsuit from CNCDA is a, “third attempt to state a claim against (TrueCar), and we believe it is as fatally defective as the first two efforts. We expect that this complaint will be dismissed by the court just like the last one the CNCDA filed.”

Certainly TrueCar had its fair share of legal battles in 2015, from a suit by CNCDA to the New York dealers suing them for $250 million. The organization also saw its founder and CEO Scott Painter step down while former AutoTrader executive Chip Perry stepped up into the role. Will 2015 prove to be another year TrueCar making headlines? Will the organization steer through them as well as they did in 2015? Finally, in terms of the pending suit, what is your opinion of TrueCar?