Chicago Business Litigation Lawyer Blog
The above video is a news story about our client David Bates’s crusade to publish negative information on the internet about a used car dealer including information about consumer fraud judgments entered against the dealer. The video tells about the consequences of David Bates’s fight — an expensive lawsuit for which he fortunately had home owner’s insurance to help fund his battle.
The story recounts how Bates won a federal court lawsuit brought against him by a used car dealer, Chicago Motor Cars. Chicago Motor Cars tried to silence Bates’s First Amendment right to publish information about it, including its documented history of fraud judgments where other consumers had proven that they had been cheated.
While informative and entertaining, the video doesn’t tell the full story. It omits to state that Chicago Motor Cars sued Bates for posting on the internet the fact that consumer fraud judgments had entered against Chicago Motor Cars in lawsuits and arbitrations brought by consumers who claim they had been deceived into buying expensive used cars from Chicago Motor Cars. The story fails to explain that Chicago Motor Cars sought to prevent Bates from telling other consumers about Chicago Motor Cars’s history of consumers fraud judgments involving customers who had brought suit claiming to have been defrauded into purchasing expensive used cars. These customers’ stories are nowhere mentioned in Chicago Motor Cars many advertisements on the internet where it focuses on selling cars. The customers had prevailed in court or arbitration in their consumer fraud claims against Chicago Motor Cars. The customers had won large money judgments against Chicago Motor Cars. Chicago Motor Cars had continued to fight with these consumers and failed to pay them the damages even after the judgments entered against it.
In order to expose this negative information about Chicago Motor Cars on the internet Bates had the courage to risk a lawsuit against him. Bates refused offers to settle with Chicago Motor Cars so he could preserve his right to publish negative but truthful information. Chicago Motor Cars offered to drop the lawsuit if Bates simply took his websites down and stopped posting. Before suing Bates, Chicago Motor Cars had offered Bates money to stop posting. Bates refused to be silenced.
The law professor in the story believes that Bate’s use of harsh language on occasion and his tenacity are not virtues. He claims that an obsession with publishing negative facts is potentially unethical. We are fortunate that this law professor doesn’t sit on the Supreme Court. The professors focus on ethics misses the real issue and is beside the point. The First Amendment has nothing to do with remaining polite or law professors engaging in armchair psychiatry about obsessive behavior or discussing the boundaries of good taste or ethics. It is about exposing the truth, including negative information if necessary, through strong worded and loud expression. If used a car dealer wants to flood the internet with a large advertising budget touting its honesty and integrity in order to sell expensive high-end luxury cars then it serves the public good to hear about the under side of that car dealer. An angry disgruntled customer who bothers to investigate the truth of that under belly and to provide a negative viewpoint that counters the used car dealer’s polished image helps buyers to make informed decisions.
Our country’s founders rejected the professors’s ivory tower view of the world and Marquess of Queensberry rules. They understood that street fighters might bring just as much to the market place of ideas as polite law professors stuck with writing treatises on subjects that often interest only other professors. The founders emphasized the importance of vigorous free speech where getting the truth out, even in a loud, rude or obsessive manner, is far more important then remaining polite and restrained. The Federal Court of appeals in Chicago explained the founders’ philosophy this way: “[f]ree speech is not restricted to compliments. . .[M]embers of a free society must be able to express candid opinions and make personal judgments. And those opinions and judgments may be harsh or critical—even abusive—yet still not subject the speaker or writer to civil liability.”
All consumers are entitled to have access to and consider all viewpoints—positive and negative—when deciding whether to do business with a used car dealer that sells extraordinarily high priced luxury cars. Chicago Motor Cars conceded this point when we took its owners’ testimony at their depositions and then again at the arbitration hearing. The owners admitted that Bates had a free speech right to publish the truth — that consumer fraud judgments had entered in the past against Chicago Motor Cars when consumer claiming to have been cheated brought their claims to court or secret arbitration hearings.
Absent Bates’s research and internet publications, the consumer fraud judgments that had entered against Chicago Motor Cars would have remained buried in court records or arbitration organizations’ secret confidential files outside the eyes of the consuming public. Websites such as the Better Business Bureau which allow businesses to pay for their listings don’t investigate businesses fully. Carfax doesn’t list unreported accidents hidden from insurance company records or often has outdated information and fails to include on a timely basis information such as that a car was branded a total loss due to hail or flood damage. Arbitration organizations keep their records secret from the public. That is why most car dealers require consumers to sign arbitration agreements and to give up their right to take the car dealers to court. WIth arbitration becoming more prevalent internet cowboys such as Bates perform a real service.
The story also omits to inform the viewers that Chicago Motor Cars filed a false affidavit when it sued Bates in federal court. In the affidavit — which Chicago Motor Cars used as its main weapon to seek to silence Bates — Chicago Motor Cars falsely testified that it had never been the subject of any consumer fraud lawsuits. It did not disclose that consumer fraud judgments had entered against it a number of times in the past. This resulted in the federal court initially ruling that Bates must take off the internet all mention of Chicago Motor Cars committing fraud or consumer fraud. Consumers were thus denied valuable information which Bates was posting on the internet.
This injustice ended when we got involved in the case and provided the Court with the true facts after forcing Chicago Motor Cars’s owners to undergo cross-examination. Chicago Motor Cars’s owners conceded when we cross-examined them at their depositions that David Bates had a First Amendment right to publish the truth which was that other consumers had proven in court or arbitration proceedings that Chicago Motor Cars had committed consumer fraud against them.
When we informed the federal judge that the affidavit Chicago Motor Cars had filed with the Court was not true, the Court entered a rule to show cause against Chicago Motor Cars. It required Chicago Motor Cars to demonstrate why it hadn’t lied in its affidavit and why it shouldn’t be sanctioned with the dismissal of its case with the award of other harsh penalties.
Facing these potential sanctions, Chicago Motor Cars threw in the towel. It gave Bates a full release for all money damages claims, dismissed all of its other claims against both him and his girlfriend, and agreed that Bates’s websites and facebook page could remain on the internet.
We then headed to arbitration to decide if certain of Bates’s videos should be taken off the internet should the Arbitrator conclude that these videos contained materially false statements and therefore defamed Chicago Motor Cars. After hearing extensive evidence and reviewing detailed written submissions, the Arbitrator rejected Chicago Motor Cars’s claims that the videos contained any materially false statements. The Arbitrator ruled that videos did not defame, libel or slander Chicago Motor Cars. The Arbitrator also concluded that Chicago Motor Cars had failed to prove that were any materially false statements in the videos which damaged Chicago Motor Cars. Statements in Bates’s videos that Chicago Motor Cars had been found guilty of consumer fraud in other court and arbitration judgments, the Arbitrator ruled, were damaging to Chicago Motor Cars only because they were true.
Below is a full transcript of the news story which omits many of the facts discussed above:
The Chicago Motor Cars showroom in West Chicago, Illinois would make any car lover’s mouth water. Porsche. Ferrari. Range Rover. The owners say they have sold thousands of luxury models.
“Customer satisfaction is our number one goal,” a dealership employee said in dealership YouTube video.
David Bates is not one of those satisfied customers. His battle is so legally charged that David wanted his lawyer at his side during an interview with TODAY’S TMJ4.
“I think they definitely mislead people,” David told TODAY’S TMJ4 reporter Tom Murray. “That was a jaw dropping day when I got served of two stacks of legal documents at home.”
It started when David saw an ad for a Mercedes Benz SL 600.
“It was to buy a car for the summer with a girlfriend and use it for that fun part of the summer,” David said.
The used car needed some work and David says Chicago Motor Cars agreed to make repairs. Still, David agreed to buy the car.
David put down a down payment. The dealership made repairs and delivered the car to his Oak Creek home. But David says the repairs fell short of his expectations.
“Issues with the body that the car had been in an accident,” David explained. “Issues that some of the functions on the car didn’t work.”
When the two sides deadlocked on how to resolve the dispute, David took his story to Facebook, then YouTube.
This car has more body work than Michael Jackson’s face,” David said in a YouTube testimonial.
David took his campaign beyond his own experience and posted dozens of additional YouTube videos. In the videos, he talks about what he considers over-pricing and reads what he claims to be other customers’ complaints.
David also has a website. When TODAY’S TMJ4 did a Google search for the dealership, their site came up first in the search result and David’s appeared second.
David became such a pest for Chicago Motor Cars, the dealership attempted to force him to take the videos down by taking him to federal court. The dealership lost and David is allowed to keep almost all of his videos up.
“Freedom of speech wasn’t free,” Bates said. “It cost a lot of money to stand my ground.”
Chicago Motor Cars now spends a lot of time and money online countering David’s attacks.
“We look to build a relationship to sell you multiple vehicles in the future and to keep you happy,” an employee said in a YouTube video posted by the dealership.
The owners did not want to record an interview with TODAY’S TMJ4, but they did talk extensively with the microphone off.
Chicago Motor Cars’ owners say they have hundreds of repeat customers. They point to an ‘A’ Better Business Bureau rating and a near perfect 4.9 out of 5 score on dealerrater.com.
The owners say they spend hours each day countering David’s claims to potential customers.
“Legally, he has not crossed the line. You could argue that he has ethically crossed a line,” said Marquette University law and media expert Erik Ugland. “There’s a fine line between a public service crusade and an unhealthy obsession.”
As for the Benz that started this all, the car was returned to the dealer and David says he has his money back. But, he is still slamming the dealership online.
“I think it’s time well spent if one person doesn’t have to walk the walk that we did,” Bates said.
Bates had posted more than 100 YouTube videos on his channel as of Friday, including one the day of this report.
Our Chicago defamation, slander, libel, cyberbullying and First Amendment attorneys concentrate in this area of the law. We have defended or prosecuted a number of defamation and libel cases, including cases representing a consumer sued by a large luxury used car dealer in federal court for hundreds of negative internet reviews and videos which resulted in substantial media coverage of the suit; one of Loyola University’s largest contributors when the head basketball coach sued him for libel after he was fired; and a lawyer who was falsely accused of committing fraud with the false allegation published to the Dean of the University of Illinois School of Law, where the lawyer attended law school and the President of the University of Illinois. One of our partners also participated in representing a high profile athlete against a well-known radio shock jock.
Our Chicago defamation lawyers defend individuals’ First Amendment and free speech rights to post on Facebook, Yelp and other websites information that criticizes businesses and addresses matters of public concern. Our Chicago Cybersquatting attorneys also represent and prosecute claims on behalf of businesses throughout the Chicago area including in Lake Forest and Vernon Hills, who have been unfairly and falsely criticized by consumers and competitors in defamatory publications in the online and offline media. We have successfully represented businesses who have been the victim of competitors setting up false rating sites and pretend consumer rating sites that are simply forums to falsely bash or business clients. We have also represented and defended consumers First Amendment and free speech rights to criticize businesses who are guilty of consumer fraud and false advertising.
Super Lawyers named Chicago and Oak Brook business trial attorneys Peter Lubin a Super Lawyer in the Categories of Class Action, Business Litigation, and Consumer Rights Litigation. Lubin Austermuehle’s Oak Brook and Chicago business trial lawyers have over a quarter of a century of experience in litigating complex class action, consumer rights, and business and commercial litigation disputes. We handle emergency business lawsuits involving injunctions, and TROS, defamation, libel, and covenant not to compete, franchise, distributor and dealer wrongful termination and trade secret lawsuits and many different kinds of business disputes involving shareholders, partnerships, closely-held businesses and employee breaches of fiduciary duty. We also assist businesses and business owners who are victims of fraud or defamatory attacks on their business and reputations.
Lubin Austermuehle’s Waukegan, and Schaumburg litigation attorneys have more than two and half decades of experience helping business clients unravel the complexities of Illinois and out-of-state business laws. Our Chicago business, commercial, class-action, and consumer litigation lawyers represent individuals, family businesses and enterprises of all sizes in a variety of legal disputes, including disputes among partners and shareholders as well as lawsuits between businesses and consumer rights, auto fraud, and wage claim individual and class action cases. In every case, our goal is to resolve disputes as quickly and successfully as possible, helping business clients protect their investments and get back to business as usual. From offices in Oak Brook, near Aurora and Rock Island, we serve clients throughout Illinois and the Midwest.
If you are the victim of a defamatory attack on your business or a consumer who has been sued to stop you from posting criticism of a business online at Yelp or anywhere else, contact one of our Oak Brook and Chicago defamation lawyers for a free consultation at 630-333-0333 or online by filling out our contact us form.