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Asolica > Blog > Finance > Ford loses $300 million fraud case in California
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Ford loses $300 million fraud case in California

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Last updated: November 27, 2025 2:48 pm
Admin
2 weeks ago
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Because of the California poll proposition system, the state has a number of the strictest shopper safety legal guidelines within the nation.

Contents
  • California’s lemon legal guidelines shield customers, producers foot the invoice
    • Ford’s complete U.S. gross sales by yr:
  • Ford loses RICO lawsuit introduced in opposition to lemon-law corporations
  • Ford says it had proof of wrongdoing

The poll initiative course of permits Californians to suggest legal guidelines and constitutional amendments with out the help of the governor or legislature.

All somebody has to do to get a legislation handed in California is:

  • Write out the textual content of the legislation
  • Submit the initiative draft to the Legal professional Common
  • Pay $2,000 submitting charge (which is refunded if the measure qualifies for an election poll)
  • Gather signatures from registered voters

If the poll proposition receives signatures equal to not less than 8% of the votes solid for governor within the earlier election and it passes the Secretary of State’s scrutiny of the purple tape, it’s eligible to be positioned on the poll for a statewide vote.

California handed the Music-Beverly Client Guarantee Act in 1970.


Lemon legal guidelines shield California drivers.

Picture by Juliana Yamada on Getty Photos

California’s lemon legal guidelines shield customers, producers foot the invoice

Music-Beverly is likely one of the strongest shopper safety legal guidelines within the nation. It protects California automotive patrons and different customers from shopping for defective merchandise.

The legislation ensures that each retail sale of shopper items within the state comes with sure implied warranties and limits retailers from voiding these warranties.

Ford’s complete U.S. gross sales by yr:

  • 2024: 2.08 million automobiles bought, +4.2%
  • 2023: 1.99 million automobiles bought, +7.1%
  • 2022: 1.77 million automobiles bought, -2.2%
  • 2021: 1.9 million automobiles bought, -6.8%
    Supply: Finest-Promoting Automobiles

Associated: Protection accuses Ford of retaliation in messy RICO lawsuit

So for those who purchase a automotive from Ford that may be a lemon, the automotive producer could possibly be required to purchase again or change your car if, after a “reasonable” variety of restore makes an attempt, no resolution is discovered. 

Retailers sued beneath the legislation should reimburse litigation prices and attorneys’ charges.

Whereas auto producers are normally the defendants in these lemon-law instances, Ford went on the offensive earlier this yr.

Ford loses RICO lawsuit introduced in opposition to lemon-law corporations

In Could, Ford filed a civil racketeering lawsuit in opposition to lemon-law corporations and legal professionals in California.

Within the lawsuit, filed in U.S. District Court docket for the Central District of California, Ford alleges that three legislation corporations, led by the Knight Regulation Group LLP and 6 affiliated attorneys and workers members, violated the Racketeer Influenced and Corrupt Organizations Act, overbilling for authorized charges by submitting courtroom timesheets recording greater than 24 hours labored in a single day. 

This week, the choose dismissed Ford’s case, ruling that Knight Regulation Group and its codefendants had been protected by a authorized doctrine often known as Noerr-Pennington immunity, which shields petitioners from antitrust claims after they foyer the federal government, even when their advocacy promotes authorities motion that would cut back competitors.

Associated: Ford recordsdata surprising $300 million RICO lawsuit

U.S. District Decide Michelle Williams Court docket additionally dismissed Ford’s RICO declare within the case Ford Motor Co v. Knight Regulation Group LLP, U.S. District Court docket for the Central District of California, No. 25-04550.

“Knight Law will never be deterred by attempts to chill its advocacy, and it will now go back to doing what it does best: protecting the American people,” mentioned Neal Katyal, the defendant’s lawyer, in response to Reuters.

In the meantime, in response to the information service, Douglass Lampe, Ford’s counsel, mentioned the corporate was upset within the ruling however famous that the courtroom “did not find that Ford was wrong on the facts or that the lemon law lawyers did not commit fraud.”

Ford says it had proof of wrongdoing

The defendants filed a movement to dismiss the case on the grounds that Ford was utilizing this case as a “thermonuclear device” to relax lawsuits introduced in opposition to the businesses, interfering with their First Modification rights.

“This action by Ford is nothing more than a thinly veiled attempt to silence firms who would dare to hold them responsible and seek justice for consumers,” Knight Regulation Group spokesperson Terry Fahn informed TheStreet in August.

However Ford claimed it had clear proof of malfeasance.

The motor firm mentioned it recognized tons of of instances by which not less than $100 million of authorized payments had been fraudulently charged to producers by lemon-law legal professionals.

In a single occasion, one legal professional billed as many as 57.5 hours on November 30 throughout a number of instances. That very same lawyer billed greater than 20 hours on not less than 66 events.

Ford says these legislation corporations are benefiting from a legislation meant to guard customers to fraudulently enrich themselves.

“Defendants abused their positions of trust as members of the Bar to deceive the courts,” mentioned Daniel Saunders, the Ford legal professional who filed the lawsuit.

Ford says that not less than half of the authorized charge purposes on behalf of car patrons during the last decade had been inflated. 

Associated: Ford suffers one other main F-150 setback

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