TRENTON, N.J.-A lawsuit for unspecified damages has been filed against Goodyear, charging the firm for allegedly defrauding auto service consumers by selling unnecessary parts and repairs. Echoing a similar suit pending against Kmart Corp., the legal action against Goodyear claims the firm conducted a ``fraudulent scheme'' through ``false and misleading advertising, false and misleading oral and written statements and material omissions to its customers.''
Filed Oct. 14 in Trenton in the Superior Court of New Jersey, Mercer County, on behalf of Eric Charles, a Parsippany, N.J., resident, the suit seeks class action status for all consumers who are alleged to have been defrauded by Goodyear auto service centers nationwide since 1988.
One of the attorneys handling the case against Goodyear, James Clinton Garland Sr., with the Tulsa, Okla., firm Frasier andFrasier, also happens to be the chief litigator in the lawsuit against Kmart, in which the retailer is charged with ``massive'' automotive service fraud. That case, which has attained class action status, has yet to go to trial. Potential damages in that case could run into the billions of dollars.
Mr. Garland told TIRE BUSINESS he and researchers have scrutinized Goodyear's auto service practices for at least two years-from about the same time they began working on the case against Kmart.
The Goodyear suit seeks injunctive relief as well as compensatory and punitive damages, alleging the tire maker billed consumers for ``unnecessary and/or over-priced automotive repair services, for installation of parts that were not necessary, for automotive repair services that were not, in fact, performed....''
Goodyear issued a response Nov. 11, saying: ``While we currently are reviewing the claims made in the suit, we stand behind our retail stores organization with complete confidence.
``Once we've had an opportunity to review the claims, we anticipate a vigorous defense of our retail stores' service policies and practices, which we believe are on the leading edge of the industry in assuring honest and fair service to our customers.''
The lawsuit states Goodyear ``used a production volume incentive/quota compensation system'' for employees which ``encouraged and resulted in the violations,'' and that the firm ``failed to disclose the existence'' of the system to consumers.
That system, the suit said, was reinforced by ``intense corporate pressure and threats to Goodyear employees imposed by regional Goodyear managers to satisfy strict quotas on replacement of high-margin automotive parts.
Goodyear's vehicle preventive maintenance schedule also came under fire.
The suit alleges that schedule is ``contrary to carmakers' scheduled maintenance and, in some instances, several times shorter than that which is recommended by manufacturers, including shorter intervals for fuel filter changes, wheel bearings repack/seals, cooling system service, fan-accessory belts, and transmission maintenance.
``Frequently, the maintenance is nothing more than a recommendation for more repair shop profits,'' the lawsuit charges.