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Ioffe v. Skokie Motor Sales, Inc.

Close Date: 02/27/2006
Topic(s): Consumer Justice
Scope of Statutory Rights and Remedies
Status: closed
Date Of Involvement: 12/01/2005
Docket: 05-735

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Description:

This case raised important questions about the extent to which federal law protects consumers from auto fraud. The federal Odometer Act (also known as the Motor Vehicle Information and Cost Savings) allows an injured consumer to bring a civil action for damages against a person who violates the Act or its implementing regulations “with intent to defraud.” When petitioner Gary Ioffe bought a used Toyota, the dealership — in clear violation of Odometer Act regulations — didn’t show him the vehicles title. Instead, the dealership signed Mr. Ioffe's name to the title without his knowledge or permission. As a result, at the time that he made his purchase, Mr. Ioffe did not know what the title would have revealed — that the vehicle was a worthless rebuilt wreck.

The Seventh Circuit held that Mr. Ioffe could not state a claim under the Odometer Act, inventing a requirement that is not in the text of the statute: that the plaintiff prove intent to defraud with respect to the vehicle's mileage. The Eleventh Circuit, in a decision issued just two months later, rejected that approach, concluding that “the Seventh Circuit failed to apply the statute’s plain language.” In a petition by Public Citizen, we asked the Supreme Court to review the case because the Seventh Circuit’s erroneous interpretation had sown confusion among the lower courts and created incentives for increased fraud. The Supreme Court denied the petition.