False Advertising and Misrepresentation – What You Need to Know

People will do anything to make money these days. Some sell cheap knockoffs, others sell at discounts, but the worst ones make money through false advertising and misrepresentation. Auto dealer fraud is a big concern in a car purchase. Car dealerships advertise their vehicles at a desirable purchase price but sell them at higher prices, advertise cars that they don’t actually sell, or used car dealers advertise their cars as having no damage when they actually have defects.

For these reasons, it is important to learn about these issues so you can recognize when car dealerships are trying to cheat you. If a dealership attempts to pull one of their tricks on you, you can choose to sue them for false advertising or misrepresentation.

What is the Definition of False Advertising?

The term false advertising refers to radio, television, or internet ads that are misleading or false. Federal laws mandate that advertisements be honest and that all claims made in them be based on scientific evidence. These rules are called truth-in-advertising laws and are enforced by the Federal Trade Commission. The truth-in-advertising laws cover a broad range of products, from medicines to automobiles.

A few of the most common types of false adverts include:

• Bait and Switch – This occurs when a company offers a product that it does not have or intend to sell. Instead, a more expensive product is provided in its place. A classic bait and switch scheme is when an auto dealer offers an exceptionally low interest rate in an advert but fails to honor the price when you show up at the dealership.
• Price Deception – A common type of auto dealer fraud is giving misleading or incorrect information about a product’s price. For example, if an auto dealer neglects to tell you that the price advertised is after the down-payment, then the ad would be deceptive.
• Failure to Disclose – It is considered false advertising if a company fails to disclose a material fact about a product.

Businesses cannot make fake claims about a product’s price, purpose, or quality. When a company or car salesman engages in false advertisement, it’s considered auto dealer fraud, and they can face sanctions and be potentially sued. Victims of fraudulent advertising are entitled to injunctive relief and compensation of damages. If you believe that you have been misled, then contact an attorney. Your complaints can help stop fraud and scams.

Is False Advertising Against the Law?

Advertisements that contain misleading, deceptive, or false information are illegal under both state and federal laws. A company or business can be held liable for misleading consumers via the internet, magazines, billboards, radio, or television. Businesses cannot make false claims about the benefits of their products, the model, history, or the condition of a product. For example, an automobile dealer cannot advertise a car as being new when it is used.

The Federal Trade Commission (FTC) is the federal agency that is responsible for enforcing false advertisement regulations or truth-in-advertising laws. If a business violates the law, the organization can bring a lawsuit on behalf of consumers, seek a court order to stop false adverts, or issue a cease-and-desist order to force the business to remove the fake ads.

In addition to federal laws, most individual states have laws in place to protect consumers against false adverts. State consumer protection laws typically allow consumers to sue businesses that engage in deceptive advertising. In the state of California, used car dealers that sell a vehicle for any amount over the advertised price violate the vehicle code.

Can I Sue for Car Dealership False Advertising?

It is against federal and state laws for dealerships to make false statements about their vehicles or services. False advertisement refers to a representation that is likely to mislead a consumer. For example, in Las Vegas, two auto dealerships — Planet Hyundai and Planet Nissan — touted deals that seemed attractive but weren’t true. They said that leases were available for zero down when they required $2,000 at signing. These dealers were charged by the FTC with false advertising.

Other types of false advertisements that you can sue for include:

• Bait and Switch Advertising – Advertising a product not for sale. The buyer is often pressured into purchasing a higher-priced vehicle than the one that was advertised. The same bait and switch tactic applies to vehicles sold for more than the advertised price.
• Failure to Disclose – Failing to disclose a material fact about a product, such as previous damage or prior use as a fleet or rental vehicle.
• Artificially Inflating Prices above the sticker price– This is used to make a price look more attractive than it actually is. People don’t usually want to pay above the sticker price, so dealers and manufacturers sometimes artificially raise the sticker price and offer supposed discounts.
• High-pressure Sales Tactics – Using forceful tactics to get a consumer to buy a product that they do not want or need.
• Deceptive Form Contracts – These usually have deceptive language in the fine print.

Both federal and state laws prohibit the above types of false advertisement. If you have been the victim of a false ad, then you might be able to sue the business that engaged in the auto dealer fraud— even if they unintentionally deceived you. Talk to an auto fraud lawyer to determine if you have a case. You might be eligible to recover monetary compensation for any losses that occurred from the false claims.

Can You Sue a Company for Misrepresentation?

Misrepresentation occurs when a company or business makes a misleading or false statement to induce another party to sign a contract. An example of fraudulent misrepresentation is when an auto dealer tells you that a used car has a warrant to get you to buy the car — when in fact, there is no warranty. Another example of fraudulent misrepresentation would be when an auto dealer lies about the condition of the vehicle to get you to buy it. If an automobile breaks down right after you drive it off the lot, the shape of the car was likely misrepresented, and you have a reason to sue.

In order to sue for misrepresentation, then you must have acted on the false information supplied by the business and suffered some kind of damages, such as a financial loss or physical injury, for instance. If you had financial or other losses stemming from misrepresentation, then it is in your best interests to contact an attorney for legal advice. An attorney can help you gather evidence against the business and get your money back. Additionally, if a judge or jury finds that fraud occurred, you might be able to recover attorney’s fees, money for losses you experienced, and other compensation.

Can You Sue a Car Dealership for False Advertising?

If you are shopping for a new or used car and believe that you have been misled by a false ad, then you might be able to sue the dealership. The Federal Trade Commission (FTC) prohibits all types of false adverts including television, internet, and radio. Auto dealers are subject to FTC rules as well. Advertising that misrepresents a car’s condition, price, or features is prohibited by law.

How to Distinguish Misleading or False Car Ads by Car Dealers?

Car dealers who are used to auto dealer fraud can usually make the false ads ‘too good to be true”. Before heading over to the auto dealer for a vehicle purchase, you need to be able to tell false advertisement apart. Below are three ways to ensure that the dealer is following fair trade practices and you’re not falling into a false advertisement trap:

1. Make sure that you read the fine print of any internet or print advertisement when buying a vehicle.
2. If you can, keep the original advertisement from wherever you first saw the car. The details can help you later if you are misled by the dealer.
3. Call ahead to check if the car you’re interested in is still available. Over the phone, state the car’s VIN (Vehicle Identification Number) that is usually included in the ad.

If you discover that the dealer has misrepresented the vehicle or somehow broken the law, then you need to hire an auto fraud attorney. They can help you file a complaint with the appropriate federal and state agencies and possibly sue the dealership on your behalf for damages.

What To Do Before Purchasing a Car

Make sure that you read the fine print of any print or internet advertising when buying a vehicle. If you can, keep the original advertisement from wherever you first saw the car. This can help you later if you are misled by the dealer. If you discover that a dealer has misrepresented the vehicle or somehow broken the law, then you need to hire an auto fraud attorney to help you file a complaint with the appropriate federal and state agencies and possibly sue the dealership on your behalf for damages.

How Do I Report a Website for False Advertising?

According to the Better Business Bureau, we are exposed to as many as 5,000 advertisements every day. Many of these advertisements are internet-based, and there’s no telling how many online advertisements contain some form of false marketing.

All website ads are subject to the same laws as print ads.

It is important to report each instance of false advertisement to keep businesses from misleading consumers and making false or even dangerous claims about their products and services. False advertisement falls under auto dealer fraud, and by reporting it, you can not only save yourself but also save many others from a potentially harmful experience. You can report deceptive advertising to the Federal Trade Commission or Better Business Bureau.

Contact our Auto Fraud and Lemon Law Attorney to Report Auto Dealer Fraud

A vehicle purchase is no small decision and auto dealer frauds are a big deal. Cars are expensive, and from the down payment to monthly payments, you will be pouring your hard-earned money to get a vehicle. On top of the high purchase price, vehicles are also something that you rely on to use on a daily basis. Before making a purchase with a dealership, research your car and see if there is a history of defects or if the dealer has a good reputation.

If you have been harmed or misled by false internet advertisements, you should contact a lawyer for advice. Call our experienced auto fraud and lemon law attorneys, so you can discuss your issue, know your options, and find a better outcome. You might be entitled to compensation, and our auto fraud and lemon law attorney can help you exercise your rights and put a stop to deceptive advertising practices. Remember, the law is on your side.