AG'S OFFICE REACHES AGREEMENT WITH MERCHANT'S TIRE AND AUTO OVER ALLEGATIONS THAT CONSUMERS DIDN'T GET PURCHASED PARTS OR SERVICES

Attorney General J. Joseph Curran, Jr. announced today that his Consumer Protection Division has reached a settlement agreement with the company that owns Merchant's Tire & Auto Centers over allegations that some consumers paid for automotive parts or services that the centers did not actually provide. Thousands of Maryland consumers will be eligible for restitution under the settlement. Merchant's, Inc., of 9073 Euclid Avenue, Manassas, VA, operates auto repair facilities throughout the Mid-Atlantic region, including 26 locations in Maryland.

The Consumer Protection Division alleged that Merchant's sold automobile parts and services without actually installing all of the parts. Specifically, the Division alleged that Merchant's sold brake services with hardware without actually replacing the existing brake hardware. The Division also alleged that Merchant's sold transmission services that required it to replace the transmission filters in consumers' vehicles, but it did not actually replace the filters. Merchant's denied the allegations, but cooperated in the Division's investigation and agreed to address the Division's concerns. The company further stated that the failure to install brake hardware does not raise a safety issue.

The settlement agreement reached between Merchant's and the Division provides that all Maryland consumers who purchased brake services with hardware after January 1, 1998, but did not receive an invoice from Merchant's reflecting installation of the hardware, are eligible to receive $60. Merchant's has also agreed to provide those consumers with an extended warranty on their brakes. All Maryland consumers with cars that had replaceable automatic transmission filters who purchased transmission service after January 1, 1998, but did not receive an invoice reflecting the installation of the transmission filter, are eligible to receive a restitution payment of $64.26. The settlement also requires Merchant's to pay the Division a $150,000 civil penalty, an additional $100,000 payment to be used for consumer education, and $65,000 for its costs and attorney's fees.

The settlement agreement also requires Merchant's to return all used parts it removes from consumers' vehicles to consumers so that they will be assured that the parts they purchase are actually installed in their vehicles. In the settlement agreement, Merchant's further agreed to install a new point of sale computer system in
each of its Maryland stores that will require its employees to document in consumers' invoices all parts they install in consumers' vehicles.

"An auto repair company must provide all the parts and services a customer pays for," said Attorney General Curran. "This settlement will help to ensure that happens in the future and that relief is provided to consumers."

Consumers who are eligible to receive restitution under the settlement will be contacted by the Attorney General's Office.

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