Timonium Chrysler, Inc.

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IN THE MATTER OF TIMONIUM CHRYSLER, INC.

D/B/A DON WHITE’S TIMONIUM CHRYSLER JEEP DODGE CONSENT ORDER, ETC. IN REGARD TO ALLEGED VIOLATIONS OF SECTION 5 OF THE FEDERAL TRADE COMMISSION ACT Docket No. C-4429; File No. 132 3014 Complaint, January 28, 2014 – Decision, January 28, 2014 This consent order addresses Timonium Chrysler, Inc. d/b/a Don White’s Timonium Chrysler Jeep Dodge’s failure to disclose material information to consumers wishing to purchase motor vehicles. The complaint alleges that respondent has advertised that specific dealer discounts and prices are generally available to consumers. The complaint further alleges that, in fact, once consumers reach the dealership, they find out that there are significant restrictions on obtaining the advertised discounts or that the advertised discounts are not available in full. The consent order prohibits respondent from misrepresenting: 1) the existence or amount of any discount, rebate, bonus, incentive or price; 2) the existence, price, value, coverage, or features of any product or service associated with the motor vehicle purchase; 3) the number of vehicles available at particular prices; or 4) any other material fact about the price, sale, financing, or leasing of motor vehicles. Participants For the Commission: Teresa N. Kosmidis and Peter Lamberton.

For the Respondent: Steven Byerts, Bass Sox Mercer. COMPLAINT The Federal Trade Commission, having reason to believe that Timonium Chrysler, Inc. d/b/a Don White’s Timonium Chrysler Jeep Dodge, a corporation (“respondent”), has violated provisions of the Federal Trade Commission Act (“FTC Act”), and it appearing to the Commission that this proceeding is in the public interest, alleges:

VOLUME 157 Complaint 1. Respondent is a Maryland corporation with its principal office or place of business at 10300 York Road, Cockeysville, MD. Respondent offers motor vehicles for sale or lease. 2. The acts or practices of respondent alleged in this complaint have been in or affecting commerce, as “commerce” is defined in Section 4 of the FTC Act, 15 U.S.C. § 44. 3. Since at least May 21, 2012, respondent has disseminated or has caused to be disseminated advertisements promoting the purchase, financing, and leasing of their motor vehicles. 4. Respondent’s advertisements include, but are not necessarily limited to, advertisements posted on the website www.donwhites.com, selected pages of which are attached as Exhibit A. These advertisements list specific “Dealer Discount[s]” and “Internet Price[s]” for particular motor vehicles. For example, one web page advertises a 2013 Chrysler 200 Limited Sedan as follows:

MSRP* $27,320 Dealer Discount -$7,499 Internet Price $19,821 Further down on the web page, the following information appears:

*All Prices must be confirmed by the Internet Department and are only valid through the Internet Department. Please contact us via phone, chat, email, or website form to verify availability and price. Adjusted price does not include applicable sales tax, documentation fee, title, freight or tag fees. [Italicized text in red print] Some incentives may be included, but not all customers will qualify for all incentives. Please ask for additional incentives that are not listed in the price. Internet Price not valid in conjunction with any other advertised price, promotion, discount, coupon offer or prior sales. Vehicle is subject to availability so please confirm before you visit. (emphasis in original).

Exhibit A at 2.

TIMONIUM CHRYSLER, INC. 93 Complaint 5. In fact, in numerous instances, the advertised discount and price are not generally available to consumers. In numerous instances, the advertised discount and price are subject to various qualifications or restrictions. Such qualifications or restrictions have included, for example, being a member of the military, being a recent college graduate, possessing a bank account at a particular bank, or owning a vehicle that has a lien on it. In numerous instances, even if consumers meet all of these qualifications or restrictions, they cannot obtain the advertised discount and price.

VIOLATION OF THE FEDERAL TRADE COMMISSION ACT 6. Through the means described in Paragraph 4, including but not necessarily limited to Exhibit A, respondent has represented expressly or by implication that specific dealer discounts and prices are generally available to consumers. 7. In truth and in fact, the specific dealer discounts and prices are not generally available to consumers. 8. Therefore, the representation set forth in Paragraph 6 of this Complaint was, and is, false or misleading. 9. The acts and practices of respondent as alleged in this complaint constitute deceptive acts or practices in or affecting commerce in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a).

THEREFORE, the Federal Trade Commission, this twentyeighth day of January, 2014, has issued this complaint against respondent.

By the Commission.

VOLUME 157 Complaint Exhibit A TIMONIUM CHRYSLER, INC.

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Chuysden 0 13-Chuysler-200-dalS 62960 ae NEIONI2 LOHR ELSE been 23/2012 1045:33 AM] TIMONIUM CHRYSLER, INC. 99 Decision and Order DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of Respondent named in the caption hereof, and Respondent having been furnished thereafter with a copy of a draft complaint which the Bureau of Consumer Protection proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge Respondent with violation of the Federal Trade Commission Act (“FTC Act”); and Respondent, Respondent’s attorney, and counsel for the Commission having thereafter executed an agreement containing a consent order (“consent agreement”), an admission by Respondent of all the jurisdictional facts set forth in the aforesaid draft complaint, a statement that the signing of the agreement is for settlement purposes only and does not constitute an admission by Respondent that the law has been violated as alleged in such complaint, or that the facts as alleged in such complaint, other than jurisdictional facts, are true, and waivers and other provisions as required by the Commission’s Rules; and The Commission having thereafter considered the matter and having determined that it had reason to believe that Respondent has violated the FTC Act and that a complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent agreement and placed such consent agreement on the public record for a period of thirty (30) days for the receipt and consideration of public comments, and having duly considered the comment received from an interested person pursuant to section 2.34 of its Rules, now in further conformity with the procedure prescribed in § 2.34 of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings, and enters the following order: 1. Respondent is a Maryland corporation with its principal office or place of business at 10300 York Road, Cockeysville, MD.

2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the VOLUME 157 Decision and Order Respondent, and the proceeding is in the public interest.

ORDER DEFINITIONS For purposes of this order, the following definitions shall apply:

A. Unless otherwise specified, “respondent” shall mean Timonium Chrysler, Inc., and its successors and assigns.

B. “Advertisement” shall mean a commercial message in any medium that directly or indirectly promotes a consumer transaction.

C. “Clearly and conspicuously” shall mean as follows: 1. In a print advertisement, the disclosure shall be in a type size, location, and in print that contrasts with the background against which it appears, sufficient for an ordinary consumer to notice, read, and comprehend it.

2. In an electronic medium, an audio disclosure shall be delivered in a volume and cadence sufficient for an ordinary consumer to hear and comprehend it. A video disclosure shall be of a size and shade and appear on the screen for a duration, and in a location, sufficient for an ordinary consumer to read and comprehend it.

3. In a television or video advertisement, an audio disclosure shall be delivered in a volume and cadence sufficient for an ordinary consumer to hear and comprehend it. A video disclosure shall be of a size and shade, and appear on the screen for a duration, and in a location, sufficient for an ordinary consumer to read and comprehend it. TIMONIUM CHRYSLER, INC. 101 Decision and Order 4. In a radio advertisement, the disclosure shall be delivered in a volume and cadence sufficient for an ordinary consumer to hear and comprehend it. 5. In all advertisements, the disclosure shall be in understandable language and syntax. Nothing contrary to, inconsistent with, or in mitigation of the disclosure shall be used in any advertisement or promotion.

D. “Material” shall mean likely to affect a person’s choice of, or conduct regarding, goods or services. E. “Motor vehicle” shall mean:

1. Any self-propelled vehicle designed for transporting persons or property on a street, highway, or other road;

2. Recreational boats and marine equipment; 3. Motorcycles;

4. Motor homes, recreational vehicle trailers, and slide-in campers; and 5. Other vehicles that are titled and sold through dealers.

I.

IT IS HEREBY ORDERED that respondent and its officers, agents, representatives, and employees, directly or indirectly, in connection with the advertising, marketing, or offering for sale, financing, or leasing of motor vehicles shall not, in any manner, expressly or by implication:

A. Represent that a discount, rebate, bonus, incentive or price is available unless the representation clearly and conspicuously discloses any material qualifications or restrictions, including but not limited to qualifications or restrictions on: (a) a consumer’s ability to obtain the VOLUME 157 Decision and Order discount, rebate, bonus, incentive, or price and (b) the vehicles available at the discount, rebate, bonus, incentive, or price.

B. Misrepresent the following:

1. The existence or amount of any discount, rebate, bonus, incentive, or price;

2. The existence, price, value, coverage, or features of any product or service associated with the motor vehicle purchase;

3. The number of vehicles available at particular prices; or 4. Any other material fact about the price, sale, financing, or leasing of motor vehicles. II.

IT IS FURTHER ORDERED that respondent shall, for five (5) years after the last date of dissemination of any representation covered by this order, maintain and upon request make available to the Commission for inspection and copying: A. All advertisements and promotional materials containing the representation;

B. All materials that were relied upon in disseminating the representation;

C. All evidence in its possession or control that contradicts, qualifies, or calls into question the representation, or the basis relied upon for the representation, including complaints and other communications with consumers or with governmental or consumer protection organizations; and D. Any documents reasonably necessary to demonstrate full compliance with each provision of this order, including but not limited to all documents obtained, TIMONIUM CHRYSLER, INC. 103 Decision and Order created, generated, or that in any way relate to the requirements, provisions, or terms of this order, and all reports submitted to the Commission pursuant to this order.

III.

IT IS FURTHER ORDERED that respondent shall deliver a copy of this order to all current and future principals, officers, directors, and managers, and to all current and future employees, agents, and representatives having responsibilities with respect to the subject matter of this order, and shall secure from each such person a signed and dated statement acknowledging receipt of the order, with any electronic signatures complying with the requirements of the E-Sign Act, 15 U.S.C. § 7001 et seq. Respondent shall deliver this order to current personnel within thirty (30) days after the date of service of this order, and to future personnel within thirty (30) days after the person assumes such position or responsibilities.

IV.

IT IS FURTHER ORDERED that respondent shall notify the Commission at least thirty (30) days prior to any change in the corporation(s) that may affect compliance obligations arising under this order, including but not limited to a dissolution, assignment, sale, merger, or other action that would result in the emergence of a successor corporation; the creation or dissolution of a subsidiary, parent, or affiliate that engages in any acts or practices subject to this order; the proposed filing of a bankruptcy petition; or a change in the corporate name or address. Provided, however, that, with respect to any proposed change in the corporation about which respondent learns less than thirty (30) days prior to the date such action is to take place, respondent shall notify the Commission as soon as is practicable after obtaining such knowledge. Unless otherwise directed by a representative of the Commission in writing, all notices required by this Part shall be emailed to [email protected] or sent by overnight courier (not U.S. Postal Service) to: Associate Director for Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue, NW, Washington, DC 20580. The subject VOLUME 157 Decision and Order line must begin: In re Timonium Chrysler, Inc., FTC File No. 132 3014, Docket No. C-4429.

V.

IT IS FURTHER ORDERED that respondent, within sixty (60) days after the date of service of this order, shall file with the Commission a true and accurate report, in writing, setting forth in detail the manner and form of its own compliance with this order. Within ten (10) days of receipt of written notice from a representative of the Commission, it shall submit additional true and accurate written reports.

VI.

This order will terminate on January 28, 2034, or twenty (20) years from the most recent date that the United States or the Federal Trade Commission files a complaint (with or without an accompanying consent decree) in federal court alleging any violation of the order, whichever comes later; provided, however, that the filing of such a complaint will not affect the duration of: A. Any Part in this order that terminates in less than twenty (20) years;

B. This order's application to any respondent that is not named as a defendant in such complaint; and C. This order if such complaint is filed after the order has terminated pursuant to this Part.

Provided, further, that if such complaint is dismissed or a federal court rules that a respondent did not violate any provision of the order, and the dismissal or ruling is either not appealed or upheld on appeal, then the order will terminate according to this Part as though the complaint had never been filed, except that the order will not terminate between the date such complaint is filed and the later of the deadline for appealing such dismissal or ruling and the date such dismissal or ruling is upheld on appeal. By the Commission.

TIMONIUM CHRYSLER, INC. 105 Analysis to Aid Public Comment ANALYSIS OF CONSENT ORDER TO AID PUBLIC COMMENT The Federal Trade Commission (“FTC”) has accepted, subject to final approval, an agreement containing a consent order from Timonium Chrysler, Inc. d/b/a Don White’s Timonium Chrysler Jeep Dodge. The proposed consent order has been placed on the public record for thirty (30) days for receipt of comments by interested persons. Comments received during this period will become part of the public record. After thirty (30) days, the FTC will again review the agreement and the comments received, and will decide whether it should withdraw from the agreement and take appropriate action or make final the agreement’s proposed order.

The respondent is a motor vehicle dealer. According to the FTC complaint, respondent has advertised that specific dealer discounts and prices are generally available to consumers. The complaint alleges that, in fact, once consumers reach the dealership, they find out that there are significant restrictions on obtaining the advertised discounts or that the advertised discounts are not available in full. The complaint alleges therefore that the respondent’s representations are false or misleading in violation of Section 5 of the FTC Act.

The proposed order is designed to prevent the respondent from engaging in similar deceptive practices in the future. Section I.A of the proposed consent order prohibits respondent from representing that a discount, rebate, bonus, incentive or price is available to consumers unless the representation clearly and conspicuously discloses all material qualifications or restrictions, if any, including but not limited to qualifications or restrictions on: (a) a consumer’s ability to obtain the discount, rebate, bonus, incentive or price and (b) the vehicles available at the discount, rebate, bonus, incentive or price.

Section I.B. prohibits respondent from misrepresenting: 1) the existence or amount of any discount, rebate, bonus, incentive or price; 2) the existence, price, value, coverage, or features of any product or service associated with the motor vehicle purchase; 3) the number of vehicles available at particular prices; or 4) any VOLUME 157 Analysis to Aid Public Comment other material fact about the price, sale, financing, or leasing of motor vehicles.

Part II of the proposed order requires respondent to keep copies of relevant advertisements and materials substantiating claims made in the advertisements. Part III requires that respondent provide copies of the order to certain of its personnel. Part IV requires notification to the Commission regarding changes in corporate structure that might affect compliance obligations under the order. Part V requires the respondent to file compliance reports with the Commission. Finally, Part VI is a provision Asunsetting@ the order after twenty (20) years, with certain exceptions.

The purpose of this analysis is to aid public comment on the proposed order. It is not intended to constitute an official interpretation of the complaint or proposed order, or to modify in any way the proposed order’s terms.

MCWANE, INC. 107 Opinion of the Commission