National Automobile Ass’n v. FTC

For millions of Americans, a vehicle is essential for travel to and from work and school, for picking up groceries, and for medical appointments.  Yet the marketplace for purchasing vehicles is fundamentally broken: Car dealerships routinely engage in deceptive or unfair practices which cost consumers time and money.  These practices include hiding information about pricing, imposing surprise price increases, deceiving consumers into believing that expensive products or services are mandatory, tacking on fees without the knowledge or consent of the consumer, and selling valueless products like supposedly nitrogen-filled tires that contain no more nitrogen than exists naturally in the air or engine oil charge services for an electric car.

In January 2024, the Federal Trade Commission (FTC), invoking its express statutory authority under the Dodd-Frank Act, issued a regulation called the Combating Auto Retail Scams (CARS) Rule. The Rule aims to create fairness in the marketplace by targeting those types of deceptive and unfair practices. The next day, the National Automobile Dealers Association and the Texas Automobile Dealers Association filed a lawsuit challenging the rule.

Public Citizen, on behalf of itself and four other consumer interest groups, filed an amicus brief supporting the Rule. The brief emphasizes that existing regulations are insufficient to protect consumers from widespread industry abuses, and that the CARS Rule provides meaningful protections for consumers from some of the industry’s worst practices.