Class action lawsuit alleges car dealership violated consumer laws in repossessing vehicles

Nov. 25—A proposed class-action lawsuit alleges an area car dealership violated state consumer protection law in repossessing vehicles from buyers who defaulted on loan agreements.

Attorneys for Karen Fabri of Hawley and Tammy Metz of Mahanoy Plane allege Car Lotta Car Sales LP violated a state law that requires lenders to pay surplus funds from the resale of repossessed vehicles to the borrower. They are seeking damages on behalf of themselves and potentially hundreds of other consumers they say may have been impacted by the allegedly wrongful practices.

According to the suit, Carlotta Car Sales is a buy-here, pay-here car dealership with locations at 3374 Scranton-Carbondale Hwy., Blakely, and 303 Wyoming Ave., Kingston.

In November 2017, Metz purchased a 2007 Ford Focus for $7,635.80 from an affiliated company, Carlotta Car Sales-H Inc., in Hazleton. Soon after, she discovered it had frame damage that had not been disclosed. She returned the car to the dealership under a voluntary repossession in February 2018. At the time she owed a $7,720.21 balance.

In April 2018, the dealership’s Blakely location resold the same car to Fabri for $8,495, for a surplus of $774.29. Fabri fell behind on payments due to financial hardship caused by the COVID-19 pandemic, which led the dealership to repossess the car in June 2020.

The suit says the vehicle was then resold to another person, who is not identified, for at least $7,995. At the time Fabri owed $1,869.89, which resulted in a surplus of $6,125.11.

The lawsuit, filed by attorneys Carlo Sabatini of Dunmore and Cary Flitter of Narberth, says state law requires surplus funds to be returned to the debtor, but the dealership failed to return the funds to Fabri or Metz.

The attorneys seek to classify the case as a class-action lawsuit, claiming the dealership likely engaged in similar conduct with hundreds of other buyers.

The suit seeks damages on five counts, including unjust enrichment and violation of the state’s Unfair Trade Practices and Consumer Protection Law.

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Marianne Gilmartin of Scranton, attorney for the dealership recently, filed a motion to dismiss the suit. Gilmartin contends Fabri and Metz signed an agreement that requires any disputes to be submitted to binding arbitration, which means the court does not have jurisdiction to hear the matter.

The motion focuses on the legal jurisdiction issue and does not address claims that the car was defective or that the dealership’s policies violated consumer protection laws. Attempts to reach Gilmartin and officials with the car dealership for comment were unsuccessful.

Contact the writer: tbesec[email protected]; 570-348-9137; @tmbeseckerTT on Twitter.

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