916 F. Supp. 2d 1294
S.D. Fla.2013Background
- Williams sought a loan using her 2009 Jaguar XF as collateral at Delray Auto Mall; Delray allegedly offered a buy-back scheme.
- On May 26, 2012, Williams executed a Purchase and Finance Agreement, financing $19,880.24 at 22.34% APR with a disclosed $10,359.76 finance charge.
- Williams alleges Delray concealed thousands in equity by inflating the resale price and failed to disclose buy-back charges as finance charges.
- Despite the $19,880.24 financed, Williams claims she only received a $4,300 loan, with down payment representations of $7,000 and about $10,000 in interest hidden by the scheme.
- On October 22, 2012 Williams filed an Amended Complaint naming Delray, FGAP Investment, and Menardy, asserting six counts: TILA, FMVRSFA, FLPA, UCC Article IX, FDUTPA, and equitable relief under the UCC.
- Defendants moved to dismiss the Amended Complaint for failure to comply with Rule 8(a)(2).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| TILA disclosure violations at closing | Williams alleges multiple TILA violations including incomplete disclosures | Delray/FGAP argue disclosures were complete in the attached documents | TILA claim survives |
| FMVRSFA compliance and finance charge | Williams contends FMVRSFA disclosures were improper and charges inflated | Defendants claim contract complies with TILA and FMVRSFA requirements | FMVRSFA claim survives |
| FLPA usury and concealment | Williams asserts the transaction is usurious and the true terms were concealed | Defendants contend rate is within Florida limits and not usury | FLPA claim survives |
| UCC Article IX notice and commercially reasonable sale | Williams alleges improper notice and unreasonable conduct under UCC | FGAP argues no disposition or adequate allegations of sale conduct | UCC claim dismissed |
| FDUTPA deceptive/unfair practices | Williams asserts deceptive buy-back and per se FTC Used Car Rule violations | Defendants deny deceptive practices | FDUTPA claim survives |
Key Cases Cited
- Cannon v. Metro Ford, Inc., 242 F. Supp. 2d 1322 (S.D. Fla. 2002) (TILA disclosures and pre-consummation requirements on closed-end credit)
- In re Omni Capital Group, Ltd., 157 B.R. 712 (Bankr.S.D. Fla. 1993) (usury analysis; substance over form)
- Dixon v. Sharp, 276 So.2d 817 (Fla. 1973) (usury framework under Florida law)
- Beausejour Corp., N.V. v. Offshore Dev. Co. Inc., 802 F.2d 1319 (11th Cir. 1986) (substance-focused approach to usury)
- Tuckish v. Pompano Motor Co., 337 F. Supp. 2d 1313 (S.D. Fla. 2004) (per se FDUTPA violation via FTC Used Car Rule)