11/30/2010Lawsuit Challenges Rental Car, Photo Ticket Collaboration
Potential class action lawsuit filed against Hertz and American Traffic Solutions for defrauding customers.
A federal lawsuit seeks damages against a rental car company for allowing the photo enforcement firm American Traffic Solutions (ATS) to place charges on the credit cards of customers without their consent. North Carolina resident Dwight Simonson filed the case in the US District Court for the District of New Jersey earlier this year and hopes it will be certified as a class action. Simonson had rented a Hertz automobile in Orlando, Florida on June 23, 2009 and was outraged to find himself being billed $10.75 by ATS for a 75 cent toll. Since 2005, the New Jersey-based Hertz Corporation has worked with ATS through a program known as PlatePass through which renters can use toll roads with a built-in payment system. Frequent travelers have expressed outrage over the automatic billing for various forms of traffic fines they consider excessive. Simonson argues that the program is intended to defraud renters.
"PlatePass is neither the boon, nor convenience defendants tout it to be," Simonson's lawyers argued. "The Hertz rental contract only makes an oblique reference to transmitting billing information for tolls and traffic violations to ATS. In the context of what really occurs, this reference is misleading."
Simonson complains that all Hertz renters are automatically enrolled in the PlatePass program without notice and can automatically incur service fees of $2.50 to $3 per day, even on days for which they do not use any toll roads or otherwise take advantage of PlatePass. Customers only see the credit card charges after they return their rental car. Simonson maintains that ATS has no right to collect these fees.
"Thousands of individuals have been victims of defendants' misconduct involving PlatePass administrative fees since its inception and implementation at Hertz car rental locations," Simonson argued. "Accordingly, plaintiff brings this suit for breach of contract, violation of the New Jersey Consumer Fraud Act and for unjust enrichment to stop defendants from continuing on their unlawful course of conduct and to recover for ascertainable monetary losses defendants have caused to him and class members."
According to the standard agreement that Hertz renters sign, PlatePass is never specifically identified, nor are the specific terms and conditions of the program spelled out. No mention is made, for example, that the fees are automatically imposed even when the service is not used. The agreement specifies fees and taxes including a $7.49 per gallon charge for gasoline if the vehicle is not returned with a full tank. No such amounts are given for the ATS administrative fees.
"You authorize us to release your rental and charge card information to our designated vendor, American Traffic Solutions, for the exclusive purpose of processing and billing tolls, parking or traffic violation fines and penalties and related administrative fees incurred during the term of your rental," the contract states.
Had he known of the charges, Simonson said he would not have rented from Hertz. For its part, ATS insists the contract is clear and that renters are legally bound to pay the all administrative fees imposed because they are voluntarily incurred.
"Frequent travelers have not expressed outrage -- quite the opposite is true," ATS spokesman Charles Territo said in an email. "Frequent travelers have elected to use the program time and time again. More than a million renters a year choose to use this service -- clearly it is beneficial to a large number of people."
Territo insisted that the customer's actions determine whether any charges are imposed.
"All vehicles are PlatePass eligible and the customer makes a decision when on the road whether they wish to enroll or not," Territo wrote. "It is only if the renter chooses to not to pay cash or use their own transponder that PlatePass will pay the tolls on the renters behalf and charge for the tolls later. A modest rental day based service fee is paid when the customer chooses to participate in PlatePass."
Territo added that signs at the Hertz counter and window stickers in the vehicle further clarify the terms and conditions that apply to the program.