Fred Beans Motors of Doylestown Facing Class Action Over Retail Installment Contracts

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Fred Beans Motors of Doylestown, Inc. is the defendant in a proposed class action in which the plaintiff claims the car dealership enters into false and misleading retail installment sales contracts, which outline the terms of the agreement and include legally required financial disclosures, with consumers. The lawsuit alleges the finance charges are supposed to be lower than what Fred Beans claims them to be in its contracts, effectively saddling customers with undisclosed fees. The case further claims Fred Beans includes in its contracts a “Dealer Fee” that, despite being represented as a charge for the preparation of transaction documents, in truth bears “no relation to the preparation of documentation, and is only meant to generate additional revenue for Fred Beans.” From the lawsuit:

“Fred Beans routinely and customarily engages in this unlawful practice. Fred Beans issues retail installment sales contracts to consumers, representing that those contracts are final and binding, but Fred Beans disregards those contracts, as well as the financing terms, as it sees fit, thus rendering the [Truth In Lending Act] disclosures illusory.

Fred Beans does so, among other reasons, so that it can lock consumers such as [the plaintiff] into a transaction while obligating itself to nothing.”

The complaint later states Fred Beans, after entering into contracts with customers and issuing financing terms, wrongfully causes hard credit inquiries to be conducted without any permissible purpose. According to the lawsuit, these hard inquiries cause decreases in customers’ credit scores and threatens privacy. Worse, according to the complaint, Fred Beans, even with binding contracts in place, allegedly “reissues new sales contracts at its whim, and for its own benefit.”

The lawsuit alleges Fred Beans’ conduct violates the Fair Credit Reporting Act (FCRA), Truth in Lending Act, and Pennsylvania consumer protection statutes.