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California Lawsuit Against ATS, Hertz Goes To Trial
Photo radar vendor ATS and car rental firm Hertz go to trial to defend against fraud charges brought by the city of San Francisco, California.

ATS Hertz
San Francisco, California is not backing down in its lawsuit against American Traffic Solutions (ATS). City officials insist the Arizona-based company has been ripping off the public, overcharging visitors who use Hertz rental cars and pass over the Golden Gate Bridge. On Tuesday, San Francisco County Superior Court Judge Curtis E.A. Karnow set the matter to go to trial in November 2018.

City attorney Dennis J. Herrera says the ATS PlatePass program and Hertz are ripping off renters by charging a $4.95 daily "convenience" fee for using a toll road. Even if a renter uses a toll road just once, the fees accumulate for the duration of the rental until they hit the $24.75 maximum, plus the cost of the tolls themselves. This, Herrera argues, violates the Restore Online Shopper's Confidence Act (ROSCA) prohibition on "data pass" online transactions that allow third parties to charge a credit card at a later date without the consumer's knowldedge and explicit consent.

Hertz insisted that the law does not apply because ATS was not a party to the online transaction with customers, but Judge Karnow expressed doubt.

"Other alleged facts suggest otherwise: The contract language stating that Hertz customers will pay for PlatePass and the fact that Hertz customers ultimately do pay ATS for PlatePass," Judge Karnow wrote in denying a motion to dismiss the case. "Obfuscation as to the true parties from whom a consumer is purchasing services does not defeat a ROSCA claim; preventing this obfuscation is among ROSCA's purposes."

Judge Karnow only found the city's assertion was strong enough to merit being further tested in a full trial. He sided with ATS in rejecting the argument that the PlatePass payment was unavoidable.

"While it is not possible to rent a car that lacks PlatePass, it is possible to avoid incurring any PlatePass charges by, e.g., avoiding the Golden Gate Bridge or otherwise paying the toll to use the Golden Gate Bridge," Judge Karnow explained. "In a literal sense, any customer could avoid the PlatePass charge and no customer is required to pay the PlatePass charge, assuming the customer has knowledge of the options."

Lawyers in the case will meet with the judge in March to further develop the schedule for the trial.

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