Challenge to FTC’s Decisions Allowing Used Cars to be Sold as “Safe” When They are Subject to Safety Recalls

Today we filed a case in federal district court for D.C. challenging recent decisions by the Federal Trade Commission (FTC) to allow used car dealers to advertise and sell “Certified” used cars as “safe,” “repaired for safety,” and “subject to rigorous inspection” when such cars are subject to pending federal safety recalls, without repairing the cars prior to sale, as long as the dealers disclose that the vehicles “may” be subject to a safety recall.  We represent Consumers for Auto Reliability and Safety, the Center for Auto Safety, and U.S. Public Interest Research Group, representing tens of thousands of consumers who will be at increased risk of economic and personal injury and death as a result of the FTC’s decisions, which will have particularly negative impacts on vulnerable segments of the population that tend to purchase used cars, including the young, poor, and inexperienced first-time purchasers.  Rather than place the burden on the used car industry to repair safety defects prior to sale, the FTC has shifted the burden to consumers to (a) find out if the used car they wish to purchase is subject to a pending safety recall; and (2) if so, make arrangements to have it repaired.  The FTC’s decisions are particularly troubling in light of the fact that there have been millions of vehicles recalled in the last several years for serious safety defects, including the defective ignition switch used by GM which causes the car to suddenly turn off while being driven--disabling the power steering, brakes, and airbag system; and the exploding Takata Airbag, used in millions of vehicles manufactured by nineteen different automakers between 2002-2015.   The agency’s actions are also troubling because used car dealers who, prior to the FTC’s decisions, had been fixing cars subject to recalls have now decided not to do so.  The Complaint filed today asks the Court to set aside the FTC’s decisions as violating the FTC Act which prohibits “deceptive acts or practices,” the agency’s long-standing Used Car Trade Regulation Rule which prohibits used car dealers from “mispresent[ing] the mechanical condition of a used vehicle,” and the Administrative Procedure Act.  A copy of the Complaint can be found here.